Most small business owners have a documented business plan, whether it is written on a napkin or formally edited into a fifty page document. One section of any effective business plan should involve a review of competitors in the marketplace. Unfortunately, many entrepreneurs make the mistake of not considering the competition after developing a baseline business strategy. Though some entrepreneurs are naturally more innovative than competitive, competition is an undeniable facet of business. In order to maintain a solid footing in the marketplace and help ensure the longevity of your business, it is best to thoroughly get to know competitors.
Know Your Competitors
If possible, one of the best ways to get to know a competitor is to become a client. While this may seem counterproductive or even underhanded at first, it can give you insight into exactly what you’re up against. To really identify and understand the competitor, become a customer and use your experience to help build your business even stronger. The comprehensive knowledge gained can boost confidence and help lead to more effective business planning.
20 Minutes a Day to Keep Track of Competitors
Remember that you may need to engage in more thorough research on your competitors on a consistent basis. Things change in business, make sure you don’t miss something that could have an effect on your business plan.
SWOT Analysis for Your Business
According to the U.S. Chamber of Commerce, SWOT is a method of evaluating the Strengths, Weaknesses, Opportunities and Threats to a business. Once analytical tools for regularly analyzing competitors are put into place, a business is ready for SWOT. Since most entrepreneurs are passionate about their businesses, these basic ideas are likely to be daily, routine thoughts. SWOT should be tracked in writing and on a regular basis.
For those who write monthly paychecks to employees or contractors, this is a great time to spend at least an hour doing a SWOT analysis. Write the results clearly and save them in a folder so that the monthly SWOT reports can be further analyzed annually or on a more frequent basis.
Keeping the Competitive Edge
There is nothing easy about launching a business in today's competitive marketplace, yet entrepreneurs are drawn to it, nonetheless, through their creative initiative. Whether the market lies in a small town, an urban neighborhood or in a niche of the online global world, a wise business owner should spend some time every day analyzing the competition. Find ways to make this easy, automated if possible, and use competitive analysis to discover developing ideas and hone classic strategies for business success.
By Pete Kontakos--a contributor that discusses Business Analyst Training and online education.