Afirm’srelates to its ability to create value for customers (V) while containing the cost to do so…

➤ What does the V − C relationship mean for a firm’s competitive advantage?
The V−C relationship compares the value a firm creates for customers (V) with the cost of producing that value (C). Managers aim to widen the V−C gap to earn higher margins. Firms do this through differentiation, tighter cost control, superior customer experience, and activities that rivals cannot easily imitate.