BUILDING AND MAINTENANCE OF COMPETITIVE ADVANTAGE BY SMALL AND MEDIUM-SIZED ENTERPRISES: THE BALDO CASE

Abstract

This paper discusses how small and medium size firms may build a competitive advantage position. Generally these firms are located in fragmented industries, where there are many competitors as a consequence of low entry barriers. As research method it was used the case method, analyzed in a longitudinal basis. We chose Baldo as the firm to be analyzed because it has an outstanding performance.  Besides being the Brazilian larger firm in its industry, it dominates the export market with a share of 75% and has had for long years a high return on asset. As theory framework it was used simultaneously the concepts of the Resource Based View and those developed by Porter. The results point to the conclusion that the sustainable competitive advantage of Baldo was a result of its decision about scope, competitive advantage and resources. Specifically, Baldo has focused the uruguaian market, used a differentiated strategy based on a higher cost product and developed resources and capacities associated with brand image and specific assets. Conceptually, the results of this research may be included in the research chain that emphasize the simultaneously use of the concepts related to Porter and to the RBV.