My Framework for Evaluating Competitive Advantage

A competitive advantage is only sustainable if it is difficult to replicate. This framework helps structure thinking about moats and barriers to entry.

The Core Question

What prevents competitors from copying what you do? If the answer is "nothing," then there is no moat—only temporary advantage.

Dimensions to Evaluate

1. Switching costs — How much friction do customers face when moving to a competitor?
2. Network effects — Does the product get better as more people use it?
3. Cost advantage — Can you deliver at a lower cost due to scale, technology, or unique assets?
4. Intangible assets — Brand, reputation, IP, or proprietary knowledge.
5. Efficient scale — Is the market too small for a second player to enter profitably?

Application

Use this as a checklist when analyzing a business or strategy. Weakness on multiple dimensions suggests vulnerability. Strength on 2–3 dimensions often indicates a defensible position.

This framework is a starting point—not a replacement for deep analysis. But it forces clarity on what actually drives advantage.