Advantage Matrix consists of four areas divided by Number of Approaches
and Size of Advantages. In this framework, each area is shown by ROA and
There are many numbers of approaches and it is difficult to build up competitive superiority. This type of businesses can be profitable when it is not large size but once size become larger, it is difficult for it be profitable for example apparel firms.
It is possible to build up competitive superiority by specialized position for example measurement hardware firms, pharmaceutical firms or car manufacturers especially in Europe.
It is often seen when scale economics reach a limit. This type of businesses needs to seek new competitive superiority such as metal firms.
In this type of businesses, scale economics can work like car manufacturers, computer companies or law materials firms.
It can be seen that small or big scale bring high profitability but middle brings low profitability in some industries such as catering firms or travel agency.