First-Mover Advantage and Disadvantages


You must have had always heard that take always take the first-mover advantage. Well, all this overly motivating one-liners are usually quoted by your friends when you want to get into any new relationship as far as I know.

If I am not wrong then everyone is also in a deep commitment and relationship with their business as well. So it is logical and way practical if we compare the pros and cons of it in the business.

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first-mover advantage

Getting the first-mover advantage is difficult at times but someone has to do it for their company. However, it true that first-mover may be uncertain, but there are good sides as well. Let’s discuss the advantages of being a first-mover:

Establishing a Brand


Consider for example that there is some kind of situation going on in the country. Now to improve that condition you have an idea which you want to turn into a business.


In this way, you can also serve society at large and can also make money out of your idea. This is the same case that happened in the past which transformed some of the business ideas into the worlds’ greatest industry.

Their first move gave them much of a success which also became an example for many others. The brand Goodwill that they created is still performing tremendously well, all thanks to the first move that they made.

Control over prices

Technology in business

If a brand has established a stronghold in the market and its products have gained the trust of the buyers. Such that every other household buys their products.

With such a good brand penetration any changes in the marketing strategy and pricing of certain goodwill definitely affect the prices of other competitive goods in the market.


The main advantage of having such a condition is that you and your brand as a whole are the bosses who can dominate the market easily.

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Technological benefit

Technology in business

Latest inventions and technology is something that every brand that is existing wants to take hold of and patent it. This idea never runs out of fashion. Having the first-mover advantage in this field is one of the best things that you can wish for.

Resource control

Using the existing scare resource and preventing others from using the same is one of the tactics that big businesses apply.

This enables them to capture the market all to themselves. This is also a way to reduce competition. Walmart is one such brand that that very meticulously used this technique to maintain a good hold.

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Disadvantages of first-mover

The other side of the coin is equally important, so here are the disadvantages of the first-mover advantage:

The risk factor


There is always a sword hanging upon you ready to be released any time. There is a persistent level of risk involved in any business that you try to build on your own but the risk gets multiplied a thousand times when you decide to choose a very different industry to work in.

This is one of the main reason that people stick to the mainstream and refrain from exploring other options.

Loss Involved

With the increase in risk factor the losses that are associated with the business also increase multiple times.


If your business idea does not work then you might suffer heavy losses in the future.

Difficult to raise investment

Raising capital

When opting a totally different theme for your business venture then it becomes quite difficult to raise investment.

Investors hesitate in making any large investment in your idea on the basis of some believe and determination that you have.

Investments are not made on the basis of some mere abstract feelings, it requires an accurate vision which is more or less lacking in any first move. It is not the case when you are investing your own savings and fund your idea alone.


Neglecting improvements

It is often seen that the first-mover tend to be in some kind of delusion of being the best and severely neglect any scope of improvement.

This is a great opportunity for your rivals to examine your product and by just making some modifications in the original product they can present a much better version of it.

A little attention on the product by the rivals can pull your company down in no time.

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Mistakes Made by First-mover

Making mistakes

Everyone who tries to do something new makes mistakes in the beginning. So does the first-mover. People entering them tend to learn from them and avoid those mistakes to a great extent.



So these were the first-mover advantage and disadvantages in plain and simple terms. These are some of the very basic things that if kept in mind can turn out to be a turning point for your business.

sanskriti gupta | GENUINE MATTERS
Sanskriti Gupta
Like researching, reading and dwelling deep in the topic to bring out the best of any subject matter, because Being opinionated is important and appreciated only if you have the appropriate and right amount of knowledge and facts to back up your material with.

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