Competitive Advantage

Abstract

Abstract Using the example of six British supermarket chains, competitive advantage is explained and quantified. When there is no explicit comparator, competitive advantage can be measured in relation to the marginal firm in the industry. In other words, the weakest firm that still finds it worthwhile to serve the market provides the baseline against which the competitive advantage of all other firms can be set. Architecture, innovation, and reputation are reviewed as the main sources of competitive advantage.

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