Economic crisis due to Covid-19 Pandemic has made most of the firms focus on price to compete with rival firms, non-price competitive methods have become insignificant
This Study is based on the South Asian County Economic Situation
Modern businesses use a variety of tactics to compete with their competitors. In the past, businesses used prices to compete with their competitors and increase market share and sales. As the 21st-century approaches, businesses are adopting price and various other strategies to compete with their competitors. In the 21st century, consumers do not care much about the price of the product or service they buy. That is, customers care about the quality of the product or service they purchase, the nature of the product or service provider, the future plan of the organization, the brand of the organization, and the work the organization does for society.
In addition to facing competition through price control for the above reasons, the company also implements corporate social responsibility projects, engages in a variety of activities to promote the brand, use expensive equipment to improve the quality of the product or service, Better quality of customer service, and advertising is done. These factors are also known as priceless competitive strategies.
However, the COVID-19 epidemic, a global catastrophe today, has led to different changes in every sector. As a result of this epidemic, every business is facing a severe economic crisis. As a countermeasure to this economic crisis, businesses have been unable to focus on other non-competitive strategies. For example, corporate social responsibility projects incur additional costs, and companies have stopped implementing such corporate social responsibility projects with this economic crisis. Also, various events held to promote the brand of the companies have been suspended. All of this has happened with this recession. To deal with this situation, every company is tempted to face competition only by controlling prices. The main reason for this is that price control does not cost the company extra when faced with competition.
The other thing is that consumers are also feeling the effects of this economic crisis in addition to business. The World Bank warns that the majority of the world's working population will lose their livelihoods due to the virus. Many people around the world today are losing income. For example Airlines around the world have lost about 400,000 jobs. Consumers are always concerned about the price of the product or service they are buying when revenue is lost and revenue is low. This is because they have to meet their needs and the amount of money they have. In this economic climate, consumers
In such a situation companies need to focus on price to grow their sales and compete with their competitors in the business environment. When there are different branded products for one product in the market and there are substitutes for a particular product in the market, consumers are more inclined to buy products at lower prices due to this economic crisis. For example, due to the size of the soap market, consumers are tempted to buy the lowest priced soap product to meet their needs. As another example, businesses A and B were selling the same two products in the market. Before the Covid-19 virus, the two businesses used different non-price competitive tactics to compete in the market. After the arrival of the virus, the "A" business lowered the price of its products as consumers paid more attention to prices. Temporarily excluded from non-competitive methods. For this reason, the "b" business had to lower the price of its product.
Due to the economic downturn caused by this epidemic, some companies had to increase the prices of goods or services in such cases. In such a case, the company that uses the price competition to increase the price of the product or service looks at the price of the product or service of its supplier and increases the price of its product or service accordingly.
For example, if "Maliban" had to raise the price of a cream biscuit, "Maliban" would look at its competitor, "Munchee's" Cream Biscuit use price waves and increase the price of its product accordingly.
In some cases, Non-price competition is important, even after this virus. But in the economy, there is a greater tendency to focus only on price competition. With this economic downturn, some service sectors are focusing on Non-price competitive methods. For example, with the advent of the virus, media outlets have become increasingly vocal about their CSR project. Examples are the "Manusath Derana" run by "Derana" and the "Hiru Sahana Yathra" run by "Hiru". They do these things to compete for side by side with their competitors. Overall, the economic crisis with the Covid-19 virus has led the majority of companies to focus on price competition and move away from temporary non-price competitive methods.