The economy is growing and irrespective of the results of the General Election (is anyone else bored by it?) there is a feeling of optimism abroad, certainly among SME leaders I meet.
A strange by-product of this however is an odd nervousness about the competition and constant complaints of some idiots driving prices down in a strong market.
T'was ever thus I'm sorry to say simply because some people think that buyers look only for the lowest price which, as we all know, is not the case.
I recall a session I was delivering at a Business School to senior business people. I was waxing lyrical on the subject of 'raise your prices, don't cut them' when I noticed one of the group sitting on the front row, arms folded and shaking his head.
I asked him to comment and he said, in effect, that unless they charged the lowest price in the market they wouldn't get any business. We agreed to disagree and some time later to my surprise he asked me to do a marketing study.
We checked 72 competitors and, lo and behold, he was smack in the middle of the price range. Incidentally the largest company which was a generic term for the industry, had far and away the highest prices.
It is not unusual of course to be concerned about competition but it becomes unhealthy when it starts to be obsessive.
Like the poor, the competition will always be with us and it behoves us to develop an approach that benefits us rather than cause us worry and concern.
They say that knowledge is power and in this case nothing could be more true. It all starts with some research to establish a baseline of information.
We live in an age where what used to be called 'desk research' as opposed to 'field research' has never been easier.
The first thing is to find out is the size of the relevant market/s so as to calculate the market penetration for the business and also for competitors.
Turnover is relatively easy to discover. A very good piece of software is DueDil.com which shows financials for UK companies. Small businesses show restricted accounts but a little judicious assuming an estimating will result in an acceptable result.
Now it is possible to see where the business lies in the market relative to the competition and is a great starting point for strategic planning.
We all know about the USP (Unique Selling Proposition). Ask the question, what is your USP? Remember the word is 'Unique' which means exclusive to your business. What makes you stand out from the crowd?
In other words what genuinely differentiates your business from the competitors and what are you doing to exploit that advantage?
Don't let yourself be sidetracked by marketing platitudes like 'exceptional service, 'superb and consistently high quality' and so on because everyone would say the same about their businesses. They are not Unique.
Knowledge is power so start a portfolio of information about each significant competitor not to follow their lead but to see what they are up to.
The more that you know about them and the market the quicker you will be able to react. Better still you will be able to lead the charge rather than following the others.
The mantra should be:
We don't look over our shoulders at the competition. We do things that make them worry about what we are doing.
Be proactive instead of reactive. Think about what you are doing or giving to your customers that they appreciate and then publicise it.
Your competitors are probably doing it too but they can't publicise it because you now have possession rights.
Make sure that the world knows about what you are doing. Let your competitors copy you. It will take them ages to do it and by then you will be ahead again.
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