Complacency is the killer, while competition is the driver. This statement is precise yet powerful, because it reiterates how essential competition is to a business today. Competition forces businesses to be productively and dynamically efficient, furthermore develops in them a need to constantly adapt, evolve and change according to what the market wants and needs. An inability to be lean and flexible directly leads to a rival swooping in and capturing the market. An inability to be innovative and up to date eventually renders the business obsolete. It is therefore imperative to keep up with and more importantly surpass competition. How does a business manage this, successfully
Business planning is vital to keeping your company pointed in the right direction. Take the time to create a thorough plan–giving thought to product development, operations, marketing, financing, business models and staffing issues–before you begin to build your business. Planning is not only important in the early stages; revisit your strategic plans regularly to keep the direction of your business in line with current competition and future trends in the marketplace.
Continuous value creation (CVC) is the disciplined process of continually examining your current product or service offerings to ensure that they are above the industry standard. Your product may be a star in the marketplace today, but it might not take long for a competitor to create a slightly better product, a new method of delivery or a new customer experience. Keep your operations as flexible as possible to quickly take advantage of new industry trends. Make research and development a consistent priority to ensure that you are ahead of the competition and the first to market with new innovations.
Effective customer service is the largest determining factor of customer loyalty and repeat purchases. According to MarketingSphere, this single factor often can give small businesses an edge over their larger competitors. Focus your sales and service efforts on delivering the most satisfying customer experience in your industry, and you will see a dramatic increase in word-of-mouth referrals and repeat sales.
Managing your finances wisely can go a long way in helping you achieve long-term business success and beating the market competition. Your small company may not have vast credit reserves available, so taking the time to build up a credit reputation through frugal purchasing and disciplined debt repayment is important to the growth of your operations. Pay attention to your debt-to-assets ratio and your times-interest-earned ratio, and compare them to other players in your industry. These ratios will give you an idea of how much of your success relies on borrowing money from banks and other lenders. Small businesses can gain an advantage by being much less dependent on debt than their larger competitors.
Marketing can be a weak point in many small businesses because the sheer costs of traditional media outlets can be daunting to companies with small budgets. Nevertheless, a steady marketing presence is vital to competitive success in business. If you do not have the funds to implement a full-scale television, magazine or radio campaign, get creative and stretch your marketing dollar as far as possible. Social media outlets, such as Facebook and Twitter, have become widely popular means of communicating with customers at virtually no cost. Consider sponsoring local events in your target markets or maintaining a presence at local trade shows. Place ads in local newspapers and smaller magazines. Post promotional flyers around town, and offer promotions. Host a charity event, and match all event sponsorships with citywide news releases. The possibilities for bootstrap marketing opportunities are virtually endless.
Competition gives us an opportunity to look beyond and come up with reformed and exclusive solutions. It is always better to take the competition in our stride and not let it hamper with your progress because eventually it leads you to success.