Business Plan Part VI

Competition

A complete analysis of your competition is vital to the success of your business.  It is nearly impossible to be competitive in a market if you don’t know who your competition is as well as what they having going for them and what they don’t.  First, you will want to learn exactly who the competition is.  Be sure to include any business that is some type of competition, meaning anyone who offers a similar service as yours or sells a similar product.  For example, if you are going to sell pizza and subs, be sure to include all places you can get pizza or a sub including grocery stores, convenience stores, etc.  Once you know who all the competition is, take an honest look at each one’s strengths and weaknesses.  Compare your business with the competition looking at how you are similar and how you are different.  List what your strengths and weaknesses are, again being honest.  It may be hard to think about the negatives when it comes to your business, but it is important to do so.  Knowing the good and the bad helps you be prepared.  It also shows potential lenders or investors you have thought through everything and that you do not see your business through rose colored glasses. 

Think about why your business is better than the competition.  What is your unique selling position (USP) that will get your customers to choose you over them?  Compare and contrast typical buying considerations such as price, service, location, quality, value, dependability, etc.  Look at the competition and how they handle issues.  Think about their approach.  Was it a successful?  Is it how you would handle the situation?  Compare your pricing structure with your competition.  Are you competitive and will you be able to make a profit?  Think about if you had to lower your prices, could you still make a profit?  If your prices are higher, explain why you can justify them and show why you believe your customers will be willing to pay more.  Be sure to back up your data as much as possible. 

A review of your competition on a regular basis is suggested.  Staying on top of what others are doing is critical to the continued success of your business.  It is the best way to identify underserved or unsatisfied markets.  It can also help you stay out of oversaturated markets.  The old saying “Keeps your friends close and your enemies closer” comes to mind.

Next time, we will talk about Market Strategy.  Until then…….

Schedule an Appointment

Need help with a business? Contact us to schedule an appointment.

Add Your Business

Want to see your Business on this list? It's FREE for your Cattaraugus County business! Get Started Here

BizBuzz Newsletter

Signup for the Enchanted Mountains BizBuzz Newsletter, Cattaraugus County's FREE monthly business newsletter, sent by email.