Most businesses operate in competitive markets: they have to 'take on' and 'see off' rivals. Each organisation must decide for itself how best to try to do this. Not all firms come up with the same answer and for good reason. Firstly, there are several different ways of gaining competitive advantage. Secondly, businesses need to play to their strengths and not all businesses have the same strengths. Thirdly, many markets are segmented and what is important to one set of customers may be less important to another set. So businesses need to decide which segments of the market they are targeting. Ways of seeking to gain competitive advantage include:
- offering lower prices
- offering clearly superior products at above average prices
- delivering products more quickly
- offering superior customer service, including after sales service.
This Case Study focuses on how Portakabin has set about gaining a competitive advantage in the hire and sale of interim (temporary) or permanent accommodation by concentrating on quality.
The Portakabin Group is a private company, owned by the Shepherd family. Clients want modular buildings for a variety of reasons. For example:
Portakabin operates in a highly competitive market and competes with tough competitors. Despite this, Portakabin has 17% of the overall UK market (its nearest competitor has 14%). In competing for business, the company decided early on to establish a reputation for quality.
It has attracted key customers who recognise that their own reputations depend, at least in part, on the quality of accommodation and facilities they offer their own customers. The chart shows the broad nature of Portakabin's high profile customer base.
Portakabin has positioned its products at the top end of the market: it looks to provide high levels of quality at premium prices.
Quality is associated with consistency. A customer who is happy with the first buying experience needs and wants to be equally happy on each further occasion.
Portakabin's motto is: Quality - this time - next time - every time.
The company believes that clients who really care about quality are willing to pay that bit more to obtain it and see 'the extras' as worth the additional expense. Today the company operates in a range of European countries as well as the UK. Portakabin's brand vision is:
'To provide peace of mind for our customers across Europe through quality buildings and services.'