The purpose of a competitive assessment is to help managers account for the presence of competitors when making business decisions. Identifying the strengths and weaknesses of competitors can allow managers to exploit weaknesses, emulate strengths, or avoid competing in areas where other companies are especially strong. Failure to account for the presence of competitors can result in bad business decisions.
A competitive analysis is an assessment of the competition in a certain market aimed at informing business decisions. An assessment typically involves creating a list of competitors and creating a profile for each competitor that includes information such as the types of products and services they sell, their market share, marketing strategies, and notable strengths and weaknesses. The assessment may also include comparisons between a business's specific products and services and the offerings of competitors.