Underground Tools Thrives on Competition

Since being founded in 2003, Underground Tools has, and continues to, drive the trenchless and trenching industries forward through competition, innovation in product line extensions and value-added manufactured product improvements in both of the underground construction industries they serve.

Basic economic theory about competition demonstrates that when firms have to compete for customers, it leads to lower consumer prices, higher quality and greater variety of goods and services, which drives increased research, development and innovation on the manufacturing side. Underground Tools plays a significant role in the underground construction markets in this exact manner. They began doing so primarily with competitive match products, which led to improved value-added product offerings at considerably reduced prices from what OEM’s were offering. This, in turn, forced manufacturers to adjust pricing to become more competitive at the dealer and retail level, while also continually improving their product offerings.

Opportunities stemming from competition may also present themselves. In several instances competition has led to partnerships between Underground Tools and OEM’s, wherein Underground Tools supplies products directly to OEM’s. They, in turn, use those products on their equipment and take them to market through their dealer networks. Hence, through competition, Underground Tools has actually become an OEM themselves. These partnerships also free up equipment manufacturer’s time and resources which allows them to focus on other priorities such as development of new equipment, which is what they do best. There are several other benefits for both parties in these relationships as well, so as you can see, structured correctly, these partnerships will be advantageous for both companies. They are also beneficial to all other parties involved in the supply chain.

When it comes to competition, consumers or end users are considered the big winners. Without competition the market would be controlled, or more appropriately stated “held hostage” by monopolies or oligopolies, which has, and always will lead to higher priced, lesser quality goods and services because without competition there are no alternatives.

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