Staying on top in the marketplace
Keep in mind these dos and don’ts when your small business faces new competition.
When a new competitor enters the market, you have to respond to stay in the game. But this doesn't have to send your business into a tailspin. If you look at this new development as an opportunity – rather than as a threat – you can actually make your business stronger in the long run.
Here are tips for staying ahead of new competitors.
Research the business
Sher Graham, chief energy officer for Synergy Solutions, a business consulting firm in Alabama, tells her clients to do their homework when a new company comes to town. Start online, but also consider visiting the competition. Gather as much information as you can about how their business differs from yours. Then determine if there are gaps your business can fill to help with your profits.
Reiterate your value, not your price
Lewis Carlyn, a retired food service and retail food executive turned consultant, says the focus should be on reiterating existing buyer benefits. Focus on what's unique about your business. Maybe it's your personal touch, your passion, or your business values. Communicate it through sales, operations, and marketing to emphasize why your customers should come to you.
Avoid getting involved in a price war because it could potentially lower the perceived value of your business and attract customers who care only about prices.
Revamp the customer experience and your offerings
Always remember to provide a great customer experience to your loyal customers. Give them special offers and treatment. By demonstrating your commitment to serving them well, you can make it harder for them to consider your new competitor.
A small tweak to your business could also help keep customers coming back. Consider extending business hours or opening an additional day.
Don't forget about your team
In the face of new competition, business owners must protect their external customers but also their employees, or internal customers, according to Graham.
"If your internal customer is unhappy, does not like where they work, or who they work with, they can rebrand your company by walking out the door and talking negatively," Graham says. "Talk to your employees, listen to them, and see what they're saying."
Carlyn suggests sharing successes with your employees. He advocates offering good wages, but also building an internal reward program or offering a portion of the discretionary earnings to everyone contributing to the business. This helps workers at all levels feel valued and appreciated – not just managers at the top.
A new competitor in the market doesn't have to derail your business. With a few added measures, you can hold on to your success and continue to flourish.
Learn more about sizing up the competition with the Competitive Intelligence Tool.