What Small Business Can Learn from Their Competition

Posted 29 Oct '21

What Small Business Can Learn from Their Competition

Choosing to start a business in what seems like a crowded market can be daunting. How could your startup possibly stand out against the businesses who've been around for several years?

While the presence of well-established competitors is daunting, it’s entirely possible to use this to your advantage when starting up a small business. Market research is invaluable in the early days, and established competitors are a great way to gather a ton of information.

Before you invest your hard-earned cash into your dream business, make sure you have a firm idea of what your market looks like and where you’re going to be positioned. Success can come from studying your competition. Figure out what they do well (and what they do poorly) and apply this knowledge to your own business.

Here’s where to start:

• Understand your market – Start by compiling a list of who is bigger than you, who might be your peer and who would be smaller than you. Then gather some information about these other businesses.

• Check out the basics - Find out how long different operations have been around, what kind of advertising they do, how they are priced, how many employees they have, how many locations do they service and so on. Getting a clear picture of different-size competitors will show you where you can slot in and the long-term potential of your business.

• Analyse your competitors offering - Pick a subsection of the businesses you’ve got some initial information on and dig a little deeper. Develop a better understanding of the services or products they offer and figure out their core competency. What do they charge for their main offering, how quickly can they offer service, do they have any upsells to drive additional revenue, are they booked up for weeks or slow to return a phone call?

• Play the role of a customer – To understand your competitors customer experience you may be able to become a customer. If they have a physical location, visit it, see how it feels, what you like and dislike about it, and whether the staff are helpful or not.

• Read their reviews - Online reviews are a fantastic source of honest customer feedback, giving you plenty of insight into what competitors are doing well or not so well. It’s these strengths that you need to replicate and weaknesses that provide an opportunity for you to do things better.

• Google them – See who ranks well and check out their websites. Are their sites easy to navigate for the information a customer needs? How professional do they look? Is online booking/purchasing easy?

Looking at what others have done and using this to synthesis your own thinking is a great way to apply your learning to your own business and help give you an edge.

Contact your WDF Professional team member if you would like to discuss further how we can help you with your business. Phone 02 6921 5444 or email accountants@wdf.com.au