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Small Business: Get to Know Your Competition

Small Business: What do you need to know about your competition?

small businessDo you have any idea who your small-business competitors are? In order to bring any business idea to fruition, you need to continue the research to include knowing as much about your competition as you possibly can. They can be a valuable source of information to you. Specifically, you’ll want to know what small businesses are already in operation and how well they are doing. The two main questions that you need to ask yourself are:

  • How big is the opportunity?- You will want to know if there is room for your small-business also, as well as whether there is an opportunity to grow and expand.
  • What is the competition doing that you can do better? If there is unlimited opportunity, this may not be a problem, but this is not usually the case. There usually is competition, and you will need to know how you can provide service better or in a unique, innovative way.
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    As you continue your research for your small-business idea, spend some time observing your competition. Sometimes this may be more difficult than other times, but, depending upon the type of business you are in, there are various things that you can do. You’re not spying or trying to learn trade secrets, you are just trying to have some sense of whether small businesses in this industry are successful, and whether there is truly an opportunity for you. You will usually want to get information related to quality, pricing and customer interest. If you call on a competitor’s customers, be sure to let them know why you are asking for information. You may also want to develop a questionnaire, provided in a business like manner. You should probably focus on some of the following tactics:

  • If your competitors advertise, study their ads carefully for the messages they are sending, what they think is important, and their pricing policies.
  • If you’re going to sell at a craft show, visit as many shows as you can and observe consumer interest in the types of products you intend to offer. Check for prices and quality.
  • If you want to do home repairs, visit homes that have had repairs. Ask if you can see some of the work, and whether the owners feel the work was of the quality that they expected.
  • If you’re planning that your small-business will offer services to other businesses, visit some of them with a questionnaire, and ask whether there are some additional services they would like to see offered.
  • If you plan to sell to retail stores, visit some, and examine competitor’s merchandise, and observe the customer’s reaction to the products being sold.
  • You can visit similar small businesses in other locations or other towns, and talk to some of the businesses who would be your competitors if they were in your area. Since you will not be competing with them, some may be willing to talk to you and explain various aspects of their business.
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    The more you know about your competition the better your opportunity to succeed. Knowing about your small business competitor’s, will tell you about the business as well as what you have to do to compete. Some of the key factors to know about your competitors are:

    Customers:

  • The type of customers they attract.
  • The number of customers they attract
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    Products or services:

  • The quality of their products or services
  • How they price products or services.
  • What special services they provide. How they advertise.
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    From this list of products and services, you should ask yourself how your small business can provide better services, or in a unique way. You should then advertise these qualities to the public, focusing on the benefits to your customer.

    Information from Start Your Own Business for $1000 or Less

    By Paul Susic MA Licensed Psychologist Ph.D. Candidate CEO/President Susic Psychological Consulting P.C.

     

    		  
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