Thursday, March 22, 2012

Factor #6 of 10: Market


Competitive position and sustainability

In the Self-Assessment, we asked you this question:

  1. Our business has:
    1. very little or no competitors, we are the industry leader.
    1. a few competitors, however we have a measurable competitive advantage and customer loyalty.
    2. many general competitors, however we maintain a measurable competitive advantage due to offering a product/service our competitors are unwilling to match.
    3. been struggling to keep up with our competitors.
    4. many large national competitors, we are a small local business that focuses on lowest price to get customers.

Typically the free enterprise marketplace will not allow a single supplier to “own” a particular market sector for an extended period of time. Customers will eventually demand to have a choice of suppliers.

Customers gain from the competitive marketplace. I.e.: Competitors can force other competitive business owners to become more efficient in their operations or to continually develop new “offerings” that contribute to creating or sustaining their competitive advantage. This drives improvements in solutions and products which continually drives competition.

At some point every business owner considers “How do I develop my business to the next level?” Strengthening your competitive advantage is a strategic decision that can spring board you forward. Taking the time to clearly understand why customers choose your products and services will help you focus on the “right things” not just “good things”.

The business whose clientele continues to utilize their services tends to have certain business practices which the client’s value. This can range from price to quality of service, to availability or convenience, to genuine desire to meet and exceed customer requirements, etc. A business that consistently maintains a solid position in a competitive market has a higher value and is easier to sell.

TO DO:
  1. Clarify who truly is your competitor and why they succeed in the marketplace.
  2. Take time to clearly identify in writing your competitive advantage.
  1. Pick two of your competitive advantages and build a strategy to remind existing and potential customers of those advantages.
  2. Measure your results.