Why you should know who is competing with your small business

Many new small business owners think that just because they have a great product or service they don't have to worry about anything or anyone else. The reality is that this is naïve thinking that can get your small business into trouble quickly. Every small business owner needs to understand that no matter how great their product or service or how unique it is they have competition. There are many different reasons why you should know who is competing with your small business.Knowing who your competition is and what they are doing will be crucial in how you place your product and service and succeed in your market. Here is why you should know who is competing with your small business-

- Know who your competition is and where they are-The first step in dealing with your competition is knowing who they are. Not so long ago, any type of business only had to consider their competition as stores in their area that sold or made the same product or something similar. Today, because of the internet the competition for your small business can be much further afield. Your target market can go online and with only a few clicks be shopping from your competition that is not even located in the same country. This makes it important to consider not only who your competition is but know where they are as well.
- Know what your competition is offering-It is not enough to just know who your competition is you should have a clear understanding of what they are offering your target market. Savvy small business owners will take the time to check out their competition both online and off in order to see what they offering their target market. Some small business owners even take it as far as ordering from the competition so they can see up close and personal how the competition's product differs from theirs. The bottom line is that not all products (even of the same type), will be the same quality. It is important to know what the weak points and the strengths are of what your competition is offering your target market.
- Know how your competition is marketing-Now that you know where your competition is and what they have to offer it is important to know how they are marketing their product or service. The bottom line is that you don't want to give your competition an open marketing avenue without any competition. You should actively seek out how your competition is marketing and determine if that marketing strategy is successful. Keep in mind that just because your competition is marketing a certain way that doesn't necessarily mean that they are being successful.
- Know how to outlast your competition and take a bigger market share-Once you have this information you can begin to use it within your own marketing plan. Many times, small business owners feel that it doesn't make a difference to know their competition. However, once you have the above listed information you can use it as part of your marketing plan to determine how you can position your product or service at the top of the market, outlast your competition, and end up with a bigger market share. It is also important to note that many lenders will want to know if you have done market research about your competition as they feel that small business owners who know their market are a much better risk when it comes to business lending. This makes it important that you know who your competition is from a finance standpoint as well as a marketing one.