Here’s a list of questions that every business manager should be able to answer with an unqualified ‘yes’. They relate largely to the fundamental need of identifying and understanding your competition, and if you find yourself giving a ‘no’ answer to any of them it means you could be short of valuable information that would provide you with a competitive advantage.
Do you know who your competitors are? Do you know where they are and how big they are? Would you be aware if any new competitors entered your market?
Do you regularly monitor your competitors’ advertising and promotions by looking for their advertisements, visiting their premises and looking at their websites?
Do you talk to your suppliers about your competitors and gather information about what they’re buying and what quantities they purchase?
Do you encourage your team members to keep an eye on marketing activity by your competitors and pass any good ideas on to you?
Do you keep up to date with technological developments in your field and will you know if your competitors adopt new technology into their business?
Do you know the statistics of your marketplace - what your share of market is and what market share is held by each of your major competitors?
Have you conducted an objective SWOT (Strengths, Weaknesses, Opportunities and Threats) analysis on your business? Are you prepared to deal with any competitive threats that might be identified?
Do you know what opportunities exist for you to grow your business – either by taking business away from your competitors or by expanding into new market areas?
Do you know what is happening in the legislative environment that might affect your operations such as new laws relating to workplace safety, environmental or product standards that could pose a threat to you or mean that you will have to change the way you conduct your business?
Do you regularly research your products against those of your competitors? Are you able to respond quickly if you find your product offers fewer features and benefits or needs improvement?
There may be a lot of work involved in finding the answers to these questions and using them to improve your product but, thankfully, yours aren’t the only eyes and ears available to monitor your marketplace. If you work together with your team you’ll be in a much better position to answer the questions and to make gains against your competitors. A business that knows and understands its rivals has a much better chance of being able to withstand competitive onslaughts and to formulate strategies that will take business away from others in its industry.
Or, you could use us. We have a specific methodology that has been effectively used for some years now. We call it a business diagnostic, and you can call us for more information on 1300 791 600. Or have a look at this process.
Mike Reddy is a Chartered Accountant, business coach and advisor helping businesses in Sydney, Melbourne, Brisbane and Gold Coast to easily increase their profits and cash flow. He is currently President of the North Sydney Chamber of Commerce, a Regional Councillor for Sydney North East and a member of the Institute of Chartered Accountants Sydney leadership team. As well as advising businesses, Mike presents business development seminars and webinars and is regularly contacted by the media to comment on small business matters. You can connect with him on Facebook, Twitter and Google+.