Cindy Rice clearly remembers the first time she realized International Brownie, her mail order gourmet brownie business, had competition. Walking through Boston's Faneuil Hall, a restored historic area and shopping district, she noticed a retail store selling trays of gourmet brownies. "I said, `Oh my Gosh! This is exactly what I'm doing!' " recalls Rice.
Now, two years later, Rice says she realizes that competition is a fact of business life. "Actually, competition is good for me," she says. "It keeps me on my toes and reminds me that I can't slack off. I have to provide really good customer service and a unique product." To make sure she's ahead of her competition, Rice periodically orders from her competitors and compares their packaging, service and quality to her own.
"Business is like any battlefield. If you want to win the war, you have to know who you're up against," explains Tim Fulton, a consultant at Clayton College and State University's Small Business Development Center in Morrow, Georgia. Unfortunately, he adds, competitive analysis is something many entrepreneurs overlook. "They assume that they have such a good product or service that either they won't have competition or they don't have to worry about it."
The truth is, every business faces some form of competition. Like Rice, savvy entrepreneurs recognize that finding a successful niche for their business depends on identifying--and standing out from--their rivals. Here's a step-by-step plan for getting the goods on your competitors.
Carolyn Z. Lawrence, MBA, is a small-business consultant and writer living in Southern California. She can be reached via e-mail at CZLAW@aol.com.