Competitors of your business are entities that offer similar products or services to customers in the same market that you are busy in. In other words, if you own a bakery on the corner, the supermarket in the nearby shopping mall that sells bread, is your main competitor.
How do competitors influence the success or failure of your business?
Competitors in a market may drive prices down in order to gain market share. Even more, they may even attempt to “steal” your best workers, and, once you are on your knees, they may offer you a ridiculous price to take over your business – only to close it the next day. In today’s business environment, even to be second-best is not good enough. The winner takes it all.
Since competitors have such a great influence on your business, you should analyse them regularly. You can start the analysis by asking the following questions:
- Who are your present and potential competitors?
- What are their positions that they have established in the market?
- What are their strategic objectives and thrusts?
- What are their present and future strategies?
- What are their strengths and weaknesses?
- What are their response patterns?
Once you have all the answers about your competitors, you should compare your business with their strengths and strategies to see where you can compete the best.
The online retail market is quickly becoming mature and saturated, especially when you are selling commodity type products. So, if you’re haven’t paid attention to your online competitors yet, now is the time, or else…
A well researched and written Business Plan helps to get your business started the right way.