Knowing Your Competition in Your Marketplace

One of the necessary evils of running a business is fighting with competitors who want a share of the market that you have. It's a reality that is understood in all phases of business from beginners to those who look to set up a monopoly. Understanding you competition will help you come up with efficient strategies for your business model and could determine the direction of your company.

Another way of looking at this is that most of the products that will be available in the markets that you're in will have either compliments, substitutes or both. Let's stay for instance, a customer may be looking for a particular car in dark blue with 4 wheel drive and leather interior. If he can't find that at one manufacture, he may look at another manufacturer's car who does have those features. If those features are important enough to him, he will purchase his car from the second manufacturer.

This is true in all industries. You will always be able to find a substitute or a product that will compliment another product to add value to it. Since this is the case, try to position yourself to be unique in adding value to another product or by offering a product that has what your competitor's product is missing.

Although there is a ton of information you can scope out on your competition, here are a few general ones to keep in mind:

1 - Their product's features

2 - Price range

3 - The quality of their product

This information should give you a base as to what the strengths and weaknesses are for your competitor's product. You can then formulate your own strategy as to how you will attack your competitors and wrestle away as much market share as possible from them.

If you find that you have an area that is weak compared to a competitor who is pretty strong in that area, let them have it. Concentrate on your strengths and market those to the market that you are targeting. Most businesses that try and focus on bringing up their weak points not only don't catch up with their competition, they also weakened the areas that they considered strong points also.

Finally, anticipate that you will have future competitors who will try and take market share away from your weak points. This is why it is good to have an established customer base and good relationship with them. Build a relationship on trustworthiness and delivering quality so they will come back time and time again, no matter what you competition tries to invent.