Compete or Retreat

When a better-resourced competitor enters your market, the instinct is to match them move for move. That instinct is usually wrong. Price wars are won by whoever can sustain losses longest — and if your rival has an asymmetric cost structure or a deeper balance sheet, that race ends badly for you. The real question is whether you have assets the attacker can't replicate: local relationships, institutional knowledge, a brand that means something specific to customers who aren't purely price-sensitive. If you do, the correct response is to widen that gap, not abandon it by chasing a fight you can't win on their terms.