The industry is adding new, more efficient capacity in the effort to reduce costs
The industry is reducing costs aggressively
The industry is consolidating through mergers and acquisitions
The number of industry competitors is on the decline
Part of the industry is automating to offset wage advantages of some competitors
Some competitors automate to become the lowest cost players
Outsourcing is a growing phenomenon in the industry
Some competitors are using growth to reduce their costs
Some industry leaders have lower returns than the smaller competitors
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Over the years, we have written a number of Perspectives that cover a broad range of subjects in deteriorating and hostile marketplaces. We recommend that you review some or all of these articles before undertaking extensive analyses or delving deeper into the other Perspectives. These broad discussion Perspectives add important context to the Analyses, Symptoms and Implications and to the other Perspectives. These general articles include:
 Use Subtle Strategy in Tough Markets A hostile market operates differently than a market with “normal” competitive conditions. But as difficult as a tough market can be, it can also present an astute management team with an unusual opportunity.
 Rare Mettle: Gold and Silver Strategies to Succeed in Hostile MarketsManagements of winning companies have common themes for success in hostile markets. They each follow five basic themes. While virtually all successful companies are aware of these themes, their implementation differs according to their market position at the onset of hostility.
 Staying Alive in a Hostile MarketplaceA few companies survive and even prosper during periods of hostility. How do these companies avoid being the victims of tough market conditions?
 Success Under Fire: Policies to Prosper in Hostile TimesA hostile market evolves through six predictable phases. Most companies fail, withdraw or become acquisitions before this evolution is complete. They fail because their management policies were not effective. The few who survive and prosper do so by making decisions that follow two rules: attract customers and discourage competition. Losers lose by not following the second rule.
 The Wisdom of SalomonIn the late 80s’, the investment banking firm of Salomon Inc. decided to leave the municipal bond market – a market the firm had lead. This withdrawal showed just how limited management’s options are when a market goes into overcapacity and how the best choice under such conditions may be the painful decision to leave the industry.