How Businesses Lose Market Share

Warren Buffett: it's better to make mistakes quickly than stand idle and suffer from unforseen opportunities.

Take Bubba:

• Year 1: Bubba has one greeeeeat product.
• Year 2: Dang! Competitors are undercutting my prices.
• Year 3: Dang! I can barely make payroll.
• Year 4: DANG! WE DIE!

Idleness destroys your grand ideas, as your competitors start defeating your offerings by exploiting the latest advances in technology/information/etc.

How Your Economy Disrupts Your Ideas

You live in an economy that grows. And grows. And grows.

• 2010 poor live richer than 2000 rich.
• 2020 poor will live richer than 2010 rich.

O DANG U GOT HI SPEED INTERNET AT HOME, 5GB FREE EMAIL SPACE, AND A $&""%*^+ BROWSER ON YOUR CELLULAR PHONE THAT CAN SHOOT PICTURES AND SHOW SEVERAL MILLION VIDEO CLIPS?? NO WAY OMG OMG NO WAI OMG OMGZ

AND YOU'RE ON WELFARE TOO? AHHHHHHHHHHHHHHHH. OMG OMG OMG XOXO

Persistent Economic Growth?

For instance, let's say that economists predict the economy will grow at a 3% rate.

That means, for example, peeps will know how to produce:

• bananas 3% quicker
• work 3% faster
• apps 3% quicker
• innovation 3% more

Standing idle, while you're stuck on your 2008 idea doesn't let you exploit the best advances that the present economy gives you.

Who benefits instead?

Your constantly adapting competitors, who become more equipped, more advanced, and stronger than anything you've developed/learned/exploited in years past, demolish your 2008 butt by giving your departed customers 2X more product for 2X less price.

Economic growth happens constantly because technology/innovation/knowledge/information keep improving, as people learn to provide more value to others.

To stay in the game?

Keep improving.

If you enjoyed How Businesses Lose Market Share, get a complimentary subscription to our freshest articles through email or through your feed reader.