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2. One of the first tasks for anyone trying to grow a business is to map out the competitive
landscape. With a good understanding of the competition you face, you’ll be able to
spot and exploit opportunities as they develop.
These 12 tips should help you draw and refine your map, beginning with your earliest
efforts to plan your new venture and continuing for as long as you stay in business.
3. One of the best ways to gauge your competition is by taking a little time to investigate
the people who run the company. If there’s an appropriate setting in which to meet your
competition face to face, do it. Where did they go to school? Where have they worked?
How long have they been in the business? What are their strengths and weaknesses?
What’s their reputation?
This information can help you anticipate your competition’s moves. For example, a local
farmer will run an agricultural business very differently than a young MBA just out of
school will.
4. If you’re competing against a publicly traded firm, consider buying a few shares of its
stock. As a stockholder you’ll receive regular updates on the firm’s financial results and
business strategies, as well as information about the future plans of the company.
There’s nothing unethical about learning about a company this way, and you may get
invaluable information: where you’re most likely to face direct competition, differences
between your firms, and new ideas and markets for growing your own business.
5.
6. >Take an informal (or formal) poll of your competitors’ customers or clients. How did
they originally choose where to spend their dollars? Why do they buy from your
competitors? Is it because of the quality of the product or service, the price, the
location, the customer support, or just habit? What do they dislike about a certain
company? What do they wish that company would provide? Would they consider
buying from you? If not, why not? If they would, what incentive might win them
over?>The nature of many businesses requires that companies disclose information to
government agencies. Such disclosures are required to undertake public offerings,
receive building permits, register for patents or trademarks, and more.
Many of those filings are public record and contain information about the company’s
goals, strategies, and technologies. If you’re in such a business, you had to do this; so
did your competition. Much of this information is public, and you’re entitled to see it.
This can be a treasure trove of information about your competitors and about your
market in general.
7. Many librarians are virtuoso researchers and can save you a great deal of time and
effort. Your library will also have local publications that may have information on
competitors in your area. Some larger libraries have specially trained business librarians
who can help you with your research by providing assistance with market research and
lists, competitive intelligence, and industry trends for established businesses. They can
also help entrepreneurs with a new idea to find sample business plans and other helpful
startup information.
The tactics that your competitors employ can be a good sign of their goals. A competitor
trying to increase its market share might lower prices; a firm attempting to increase
profits may cut costs; and a business that wants to accelerate sales growth might kick off
a major marketing campaign. If you know your competitors’ goals, you’ll be better able
to anticipate and respond to their strategies.
8. There’s a good chance that a lot of other people are trying to meet the need your
business is trying to meet at the same time. This is especially true if you start a business
in an emerging market.
A national chain may not have entered your region yet — but what if it does? Likewise,
companies that don’t currently compete with yours might shift their focus and pit
themselves against your firm. You need to be ever vigilant and alert to other companies
stealing your business and preventing your company from thriving.
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