Dear M & M: I am wondering why I should take the time to find out what my competitors are doing. — Betty
Dear Betty: I cannot stress the importance of knowing everything about the market(s) you are in or are about to enter.
The first step is to identify who your competitors are, then take a good look at what they’re doing. What specific things are they doing better than you? Are their prices lower? Do they have a better location? Is their service after the sale better than yours?
Everyone needs to conduct a SWOT analysis (Strengths, Weaknesses, Opportunities and Trends).
All four areas need to be examined.
First, take a look at your competition in terms of what they do better. Maybe they are open 7 days a week, or 24 hours a day.
If there isn’t enough business from 10 p.m. to 7 a.m. and you can’t afford payroll to compete with an open store, or a person answering the phone 24 hours a day, don’t do it.
When you are open, though, make sure you are at your best and that you return phone calls or messages immediately.
What if your competitor pays for advertising and you can’t afford it? Consider launching a social media campaign, which takes time but is free or cheap.
Another way a little knowledge can go a long way: If your competitor can buy widgets for far less than you can, don’t feel you need to sell widgets. Or you could include installation or sell an upgraded version of the widgets your competition is selling, or offer better services when the widget breaks.
Now let’s talk about your competitors’ weaknesses. This can be anything from being undercapitalized to having poor customer service. Always think, what can I do better?
Next up is looking for opportunities. This is all about doing something your competition isn’t. Explore options, see if the opportunity is right for you to take advantage of.
Finally, look at trends. What does the future hold? What do people want now? If green is the color of the month, you’d better have some green products to sell.
The bottom line: Having no competition is a bad thing. Competition motivates you to improve all the time. And that’s a very good thing. — Shu Qi