Many business owners fear that a strong competitor will put them out of business, or at least take some of their customers. As long as your market is large enough, however, there are usually plenty of customers to go around. Healthy competition is by no means reason for panic, and in fact, it’s a good thing.
If you’re not convinced, check out this article: “Why Competition is Good News for Your Business”
Find a Differentiator
Your business must have that special something that sets you apart from competitors. Think about large-scale competing companies: Apple & Microsoft; GM & Chrysler; Nike & Adidas. Each of these companies make the same thing that its counterpart makes, and yet they are all hugely successful—how do they do it? Differentiators. The market is already established for each industry, so they don’t even have to worry about that. These companies have created key differences that distinguish them from competitors, and in doing so, they split the market so that consumers either prefer one, or the other.
There are 2 ways to learn from your competitors:
Solve a Problem
Another healthy way to make the best of a competitive situation is to find out what a competitor is doing wrong and improve upon it. The majority of small businesses are successful because they discovered a problem that a large group of people are experiencing, and they figured out a way to solve the problem. The same is true of inventors. If you have a competitor that provides the same service that you do, but you can see that they have missed one or more key elements or features—then you’ve just found a perfect opportunity to increase the value of your own company, by doing what your competitors may have missed.
Let Your Competitors Teach You
The inverse of that strategy is just as important. Do a little reconnaissance. One of the objectives during the Cold War was no doubt to find out if the other side had found any advantage, and use this knowledge for the advancement of one’s own nation. Even though you’re not manufacturing nuclear weapons (I hope), you can improve your own business by learning from your competitors—but try to avoid corporate espionage.
Be optimistic, and don’t let your business become stagnant
Use Your Shortcomings as Fuel
Chances are, you have a competitor that is really on to something. If, for example, you have a competitor that does exactly what your business does, but seems to be having a great deal more success than you are, there’s probably a good reason for that.
That can be very disheartening, but the key is to use it as motivation instead of letting it discourage you. Strong competition is the thing that can make you ask yourself, “Ok, where am I missing the mark?”
It’s possible that you have become too comfortable. When business is steady and mediocre, you can quickly stagnate; that’s a signal that you need to try something new, and “Think Different,” as Apple Computer so aptly put it.
If you run a small business, then every day, you are contending with adding features to please your customers, staying on top of your team, and planning for the future. Ironically, your competitors are one thing that you should not be battling. The fact that you’re still in business proves that you must be doing something right. As a rule of thumb, if you spend your time improving your product or service and taking care of your customers, you shouldn’t have to worry about the competition, except to learn from them.
Stephanie is the Marketing Director at Talkroute and has been featured in Forbes, Inc, and Entrepreneur as a leading authority on business and telecommunications.
Stephanie is also the chief editor and contributing author for the Talkroute blog helping more than 100k entrepreneurs to start, run, and grow their businesses.