Are you proactive or reactive? Are you inclined to see potential opportunities or notice another failure? Are you actively aware of what your competitors are doing or are you only concentrating on your own business?
Many businesses make the mistake of either assuming that they have no competitors or ignoring them outright. They usually learn this is a bad idea after it’s too late.
No business operates in a vacuum with guaranteed sales and concrete profit margins. And, even if they do, they won’t for long before someone else decides they want some of that as well. The point is – you need to be conscious of what your competitors are doing and understand how you will respond. Chances are, unless they’re insane or incompetent, your competitors are doing everything they can to make their business more successful. That potentially means at the detriment of your own business.
So, let’s assume your business has an active strategy and you know what you’re doing tactically, day-to-day, to win more business or secure what you already have. Does your business planning account for what your competitors are doing? Because no matter how active you are, your success will be limited by what your competitors or substitutes are doing to make their own businesses more successful. Remember that no business exists in a vacuum – your competitors aren’t in business to help your business.
How will you respond if they
- launch a new product or service
- cut their prices or initiate a sales promotion
- improve their product or service quality
- raise their profile in the media or industry publications
- partner with a non-competitive supplier to offer additional services
- find a more robust and responsive distribution channel
Any of these actions could potentially have a significant impact on the success of your business. If you’ve not thought about your contingency planning and how you will respond to these actions your business will likely suffer. The faster you respond with a well constructed plan the more you will likely be able to mitigate the damage to your own business. You should assume that most of your competitors are looking to do one or several of these things all the time.
Stay vigilant, keep well informed and plan. If you aren’t in the middle of one of these actions yourself, you need to be sure how your business will respond to them quickly and decisively. Maybe you can even use your competition as a form of feasibility testing – if they do something and it works, look to improve on it and do it yourself! That could save you the development time and potential costs of failure if it doesn’t work.
Just be ready to act.
We can help you in all areas of your planning, contact us to find out more.