422 Trakia Journal of Sciences, Vol. 18, Suppl. 1, 2020 Trakia Journal of Sciences, Vol. 18, Suppl. 1, pp 422-429, 2020 Copyright © 2020 Trakia University Available online at: http://www.uni-sz.bg ISSN 1313-3551 (online) doi:10.15547/tjs.2020.s.01.070 FIRM COMPETITIVENESS OF MANUFACTURING INDUSTRY D. Doncheva* Department of Economics, Faculty of Economics, Trakia University, Stara Zagora, Bulgaria, ABSTRACT The study of firm competitiveness allows to make an objective assessment of the economic results and the possibilities for increasing the level of competitiveness by highlighting the sources of competitive advantage of the respective company in the conditions of expanding competition in the domestic and international markets. This will allow for effective strategies to be developed and will reveal new opportunities for good long-term results. The aim of the paper is to apply a firm-level competitiveness approach and model for the Manufacturing sector identifying the main sources of competitive advantage that determine it. Biserial Correlation and Optimal Binning are used as a related method in this study for assessing firm competitiveness. Key words: modeling of competitiveness, Biserial Correlation, Optimal Binning, financial statement analysis INTRODUCTION The economy today is characterized by processes of increased globalization, dynamics and hyper-competition between market entities in pursuit of high financial results, favorable image, and growth. In the struggle for scarce resources, hundreds of companies go bankrupt each year and new market entities emerge whose existence sometimes depends on the level of competitiveness achieved. Competitiveness predetermines corporate power and the ability to achieve higher economic and social effects. The study of firm competitiveness allows us to make an objective assessment of the economic results and opportunities for increasing the level of competitiveness by highlighting the sources of competitive advantage of the respective company in the conditions of expanding competition in domestic and international markets. This will allow effective strategies to be developed and will reveal new opportunities for good long-term results. As an economic category competitiveness manifests itself on a product, firm, industry and national level in a cause-and-effect ___________________________ *Correspondence to: Dora Doncheva, Ph.D., Department of Economics, Faculty of Economics, Trakia University, Stara Zagora, Bulgaria, 042/ 699 428, e-mail: dora.doncheva@trakia-uni.bg relationship interacting one with another. A competitive economy enables the development, prosperity and economic growth of industries, while competitive firms have the opportunity to invest and grow their businesses. So that, they could change the competitive structure of an industry and increase the standard of living of the population. Thus, firm-level competitiveness is a driving force for the progress of a national economy. Competitiveness is a complex and multidimensional category and there are many definitions about its concept because of the scope, complexity and differences in the objectives of market entities and sources of competitive advantage at each level studied. Nevertheless, in general, many researchers (1- 7) see a firm's competitiveness as a competition for achieving a better result than other competitors, by offering a better product, reaching a high market share, having more and better resources, attracting more customers, etc. Thus, it can be summarized that firm competitiveness cannot be measured by a single criterion. The various criteria are selected based on highlighting the strongest competitive advantages. The sources of competitive advantages are looking for individual key characteristics of the business or