Then why 99% of entrepreneurs choose to launch a business in a highly competitive environment?
You know what, I’ve worked in a big corporation where my job was to sell million dollar’s value of high voltage products in a perfect competition sector. It made me realize one thing, that it’s damn hard to be good at selling a commodity product when the price is the only argument on the table. It’s hard to negotiate a contract when the customer has such a position of strength. They can dump you anytime and choose another supplier since you are all selling the same commodity.
Actually, no matter the size of the business, most executives look good in a monopoly situation and look rather bad and inefficient in a perfectly competitive environment. In a monopoly situation, you have room for mistakes, while any mistake in a competitive sector can be fatal. And this is true for a big company, a medium size company, and a start-up! Do you want to look smart as an entrepreneur, smarter than you really are? Then, fight on an easy ground, in a low competitive sector.
That said, if you start a business and then realize you are heading in the wrong direction, in a highly competitive sector, why don’t you turn around and switch to another project? Anyways, if you stick to your bad idea, sooner or later you will face a major storm and your boat will sink, not because you are a bad captain, but because you are sailing on the wrong boat.
Good luck in finding your next big idea!