It is important for you to analyse your competitors to identify who and where they are and what they do is essential for your business survival.
RECIPE FOR SUCCESS INGREDIENT CARDS
Ingredient 2: Discover Your Market
Question:
Why is it important for you to analyse your competitors?
Answer:
There are two main types of competitors for your product/service direct and indirect.
If you are in the restaurant business another restaurant business would be a ‘direct’ competitor. On the other hand, a food business offering takeaway meals would be an ‘indirect’ competitor. In other words, ‘indirect’ competition comes from businesses that are not identical to your own, but which compete alongside it for customer dollars.
Unless you are selling a product or service which is completely new someone is probably offering something similar in your area. And the more specialised your business, the larger will be your competition area. For example, if you run a suburban milk bar, you would not normally need to look beyond your suburb to assess your competition, but if you run a catering business, you would need to look city-wide.
Have a look at your competitors. Group your competitors into types and analyse a few in-depth. If you’re having difficulty deciding how much to charge for a product or service, check out what your competitors charge. You can get information from various sources, such as newspapers, ringing your competitors directly, and the internet.
I think that while you need to know who your competitors are, it doesn’t pay to get too concerned about what they are doing. There’s always going to be a lot of competition, but there’s always room for a food business offering a quality product and good service.
The ‘competition’ is anyone who is competing with you for a share of the market.
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