Episode #300: Should We Worry About Our Competitors?

When competitors get fiercer overnight, most businesses discover too late that “doing fine” isn’t a strategy. If your rivals suddenly slash prices, poach your people, or win with scale you can’t match, what protects you? The answer is simple, but not easy: build a moat before the invasion starts.

Competitor intensity isn’t random. It depends on structural forces in your market:

• Commodity pressures: If price and supply capacity decide everything, competition becomes a race to the bottom.

• Narrow-band markets: If there are only a few suppliers and market share is hard to grow, rivals fight harder for every inch.

• Currency exposure: If exchange-rate swings can hit your margins, your competitive position can shift suddenly.

• Tech disruption: If a rival’s breakthrough could wound—or destroy—your business, your risk is existential.

• Regulation shocks: If one policy change could flip the playing field, you need protection now.

• Capital warfare: If “deep pockets” win, competitors can buy share through price destruction.

• Talent vulnerability: If losing a few key people could cripple you, your moat must include people strategy.

Mini-summary: Competitor ferocity rises when markets reward scale, price cuts, tech leaps, or regulatory advantages. Your job is to spot which force could hit you first.

What happens in “normal” competitive markets?

Most industries have many competitors and many buyers. The brutal truth is that access decides outcomes.

You may have a sales team of twenty, while a rival deploys hundreds. They simply touch more clients and flood the market faster. New entrants often accept losses to buy share, undercutting the prices you spent years building.

That’s why competitive markets feel zero-sum: clear winners, clear losers, very little grey.

Mini-summary: In crowded markets, your limitation isn’t demand—it’s reach, resources, and the willingness of rivals to destroy price.

Because good times are busy times.

When buyers are demanding more, cash is strong, and operations are full, moat-building feels optional. There’s no “spare capacity” for strategic reinvention. Mentally, everything feels fine.

But that’s exactly why moat-building is hardest and most necessary before crisis hits.

Mini-summary: Businesses skip moat-building because urgency is low during good times—yet that’s when it must start.

What does COVID-19 teach about timing and survival?

This situation perfectly described our business in 2018–2019. We were surging. Revenue was strong. Demand looked endless.

Then January 10th, 2020 arrived: Japan’s first confirmed COVID-19 case triggered cancellation after cancellation of client training. Suddenly the outlook turned grim—and we had no moat.

So we did what crises force you to do: we built one.

Over the last two and a half years, we used excess capacity to rethink value and escape “apple-to-apple” comparisons.

Mini-summary: Crisis exposes missing moats fast—but it also creates the time and urgency to build them.

How do you shift from “apple vs. apple” to “musk melon vs. apple”?

A moat comes from unfair value—value that competitors can’t easily replicate.

Think of your offering like a musk melon: in Japan, musk melons are luxury-priced and considered high value. If you can deliver musk-melon value at apple prices (or just slightly higher), you become incomparable. That is the moat.

The strategic move is to escape direct price comparison by changing what the buyer is comparing.

Mini-summary: A strong moat makes competitors irrelevant by changing the comparison itself.

Value is the core ingredient, but not the obvious kind.

Most companies believe they already provide enough value. Without a life-or-death threat, they don’t brainstorm deeply enough to find new configurations of impact.

Moats often require giving buyers extra value you’re not directly paid for. That feels expensive—because it is. But that cost is what makes the moat hard to copy.

Look for:

• Internal efficiencies that let you pass economic advantage to buyers

• Add-on services tied to products (or products tied to services)

• Ways to save buyers time and money without lowering quality

Mini-summary: Moats are made of value that costs you something—and that’s why competitors can’t clone it.

What’s a real example of moat-building under pressure?

We’d been delivering virtual training globally since 2010. Japan had considered it, but two barriers slowed us down:

1. The money to translate curriculum

2. The time and effort to train instructors and producers

COVID created the urgency. We found the money and time quickly because survival demanded it.

In retrospect, we should have acted earlier—but without pressure, we dawdled.

Mini-summary: Strategic upgrades often happen only when forced—so force yourself early.

Crises are guaranteed. Timing is always cruel: you need moats most when you least have time to build them.

That’s why the best moment to start is now:

• If you have excess capacity, use it.

• If things are good, start anyway.

• Identify your “musk melon” upgrade and build it before you’re desperate.

Mini-summary: Start moat-building before you need it—because you will need it.

• Competitive pressure spikes when markets reward price cuts, scale, regulation, or tech disruption.

• Moats must be built before crisis, not during it.

• The best moats create incomparability: “musk melon vs. apple.”

• Moats are expensive by design—your cost becomes your protection.

Founded in the U.S. in 1912, Dale Carnegie Training has supported individuals and companies worldwide for over a century in leadership, sales, presentation, executive coaching, and DEI. Our Tokyo office, established in 1963, has been empowering both Japanese and multinational corporate clients ever since.