Barriers to entryBanks and investors like businesses that are protected fromcompetition in some way. Such protection usually results inprotected income and higher than normal profits. A casino, forexample, is protected because the law usually limits the numberof casinos in a locality. In contrast, a retail shop on the highstreet has no protection against a competitor opening next door.recall an instance of just such competition, where a retailer ofchildrens clothing suffered someone opening right next door inexactly the same business.

Significant barriers to entry includehigh cost of equipment or building brand recognitionpatents or scarce technological know-how;licensing, eg a pharmacy must be licensedlocation, eg as outlined above, being the last petrolstation before the motorway both confers a benefit andis also hard for anyone else to replicate;access to a scarce resource, eg a salt producer located onsalt deposits;a strong brand.If there is something like this that protects your business fromcompetition, you must include it in your plan.New technologiesThe effect of new technologies seems worth a special mentionin our times. Whilst this is an aspect of trends and maybe ofcompetitive advantage, it is often worth a particular mention.Most businesses are being affected by opportunities andthreats from the internet and other emerging and developingexplain why a development does not constitute a threw.5Etechnologies. It is usually a good idea to discuss this in youbusiness plan. You should explain what you plan to do to takeadvantage of anticipated changes and to head off threatAn example might include explaining your ability to reducecosts through effective use of telecommunications andcomputers. The costs of computer power continue to fall andhave allowed banks, for instance, to replace many staff withsmart systems.At the same time, investors have a fear that new technologieswill be, in turn, superseded. If you develop a business that usesCD ROMs you may have to address how you will deal with thenext generation of technology such as mini-discs or the internet.One approach to this is to show how you will make sufficientprofit in a short time to make the project worthwhile. Another isto show that you will be able to take advantage of the nexttechnologies to appear.Mixed strategiesWe sell books through Amazon Marketplace and we generallyry to be the lowest-priced seller of each item. However, wealso compete on service and so we will aim to price higherthan competitors who supply from the US, who can take twoweeks to deliver, compared to our two days. We also price abovecompetitors who have very poor customer feedback. If yourbusiness uses mixed or complex strategies then describe them