If you’re a business owner, competition is inevitable. Even if you are in a very niche industry, there is still a possibility of going head-to-head with another company with similar strategies and goals as yours.
Competition can be good for business because it makes you constantly think about being a better business owner.
However, at times, competition can be overwhelming.
Here are some simple ways to deal with competition as a small business owner:
Research your competition
You’ve probably done this research already when you were planning your business. But it’s always advisable to regularly check out the competition’s website and social media presence.
If possible, check out their physical location and the quality of their products and services. Ask yourself what would make customers choose you over them.
Find ways to differentiate your business from your competitors’ businesses.
You can accomplish this by offering something they don’t — a different product or service, better customer service or convenience, lower prices, more flexibility or better terms, delivery options, etc.
To avoid competing on price alone (which is usually a losing game), find other ways to set yourself apart from the pack to compete with what makes sense for your business model.
Set goals for your business
The first way to deal with competition is to set some goals. What is it that you want to accomplish? Are you looking to expand into new markets?
Do you want to increase sales by 20 percent? Understanding what you want will help you figure out how to deal with competition effectively.
Aim high, but start small.
While setting goals for yourself may seem significant in theory, it’s important not to bite off more than you can chew.
If this is your first time competing against another business, set the bar low for yourself to have room for improvement.
Be unique
One of the biggest mistakes entrepreneurs make when starting a new business is competing solely on price – i.e., being the cheapest option in the market.
That rarely works in the long run unless you’re prepared to deal with razor-thin margins and large inventory volumes.
Competing based on your uniqueness is much more sustainable than competing based on price alone.
Know what makes you different from the other guy and use that to attract customers.
Provide excellent customer service
Good customer service is the best way to attract customers when they have too many options. If you treat your customers like gold and ensure they have a great experience every time they come in, they’ll be loyal to you. Build that reputation, and your business will grow by leaps and bounds.
Here are some key examples of excellent customer service:
- Responding to customer inquiries and concerns on time.
- Taking the time to understand the customer’s issue or question.
- Providing a personalized experience makes the customer feel valued. Addressing them by their name, remembering their preferences, and offering tailored solutions.
- Resolving issues in a timely and efficient manner, even when mistakes are made.
- Going above and beyond to meet a customer needs.
- Being honest about products, pricing, and policies.
- Actively seeking customer feedback and using it to improve services.
- Offering customer support across various channels, such as phone, email, live chat, and social media.
- Unexpected gestures like discounts, freebies, or handwritten thank-you notes.
- Providing after-sales services.
Partner with your competitors
The best way to deal with competition is by partnering with your competitors. To illustrate this, imagine that you are selling delicious, freshly baked cookies. All of your customers love your cookies and wouldn’t buy anyone else’s.
Now, let’s say a new bakery opens up down the street. Your competitor sells delicious cookies, too! Their cookies are so good that they start stealing some of your customers.
So how do you handle this? Do you start making less tasty cookies? Or do you buy more ingredients to start selling them at half price? Nope!
Instead of competing on the same level as this other bakery, it is wiser to become friends with them and offer something different: cakes and cupcakes! In other words, you’ll continue selling delicious cookies and adding cakes and cupcakes to your menu.
Before long, you and the other bakery will be referring customers to each other based on their unique needs.
When you work together, instead of against each other, you have more business and a better reputation.
Focus on your niche
If you’ve ever felt overwhelmed by the sheer number of competitors, you’re not alone. A quick Google search for the products or services you sell will probably reveal hundreds (if not thousands) of other businesses that sell the exact same things that you do.
And many of them seem better-funded and more established than you are.
But here’s the thing: You’re better off being one of several small fish in a big pond than the only small fish in a tiny puddle.
The existence of competition means people already have an interest in what you’re selling — which means you can find unique ways of standing out among the rest.
To stand out in your niche:
- Keep up to date with the latest customer trends.
- Offer discounts and promotions during special holidays.
- Partner with influencers who can drive traffic to your business
- Offer complimentary products or services.
Final Thoughts
The best way to ensure you stay ahead of competitors is to be your own worst critic.
Ensure that you are constantly trying new techniques to see what is most effective for your business.
There is no shortcut to growing a successful business. And competition is just one of the hurdles you have to overcome to be a successful business owner.
How do you handle competition in your business? Let us know in the comment below!