Performing a Business Competitor Analysis
As a small business owner, you’ve got competition. There is extreme value in conducting what’s called a business competitor analysis, which is essentially an assessment of your competition’s strengths and weaknesses. It allows you to nail down areas of opportunity in your small business and reinforce the parts you’re exceptional in. While a competitor analysis is an essential strategy for many businesses, it’s not something that is conducted routinely enough. Here, we’ll dive into how to perform a competitor analysis and what you can expect from the results.
Ideal for both offensive and defensive strategies, a competitor analysis can be a great way to figure out how to out-perform the other guy. It can also help you to improve your current products and services. The analysis should be performed regularly to ensure you’re keeping up with ever-evolving trends in your industry. If you know your competition inside and out, you can work to really make your business stand apart from the crowd. What makes you different, and in turn, better?
It might seem simple to identify your competition. You’re probably very familiar with your direct competitors, but what about your indirect competition? According to Market Business News, “Indirect competition is competition between companies that make slightly different products but target the same customers.” There are also tertiary competitors, which provide a product similar to yours but don’t necessarily compete with your business. Should their strategy shift however, they may become a more direct competitor. It’s important to identify all types of your competition when conducting an analysis like this—you never know who is going to come up from behind.
What should your analysis include? We grabbed this helpful list of elements from Traqline:
- Figure out who your competitors are
- Determine who your competitors are targeting
- Define your competitive advantage (via a competitive feature matrix)
- Learn where your competitors are thriving
- Nail down where your business can come in a shine
Data points such as number of employees, annual revenue, websites and social media channels, and number of locations are important to include in your analysis. Grab hold of their messaging (via their website, social platforms, and emails) and pricing as well. Once you have all the data you need, there are plenty of no-cost competitor analysis templates out there to utilize to put it all together.
You’ll see through a competitive analysis that there are bound to be gaps in other business’s strategies, gaps you can fill with the right knowledge and tools at hand. When you have the data to back up your business strategy and get a leg up on the competition, half the battle is won. Couple that knowledge with a small business loan from ARF Financial to invest in new equipment or marketing collateral and you’ve got a recipe for success. At ARF Financial, our small business lines of credit or Flex Pay loans are a great way to increase ROI in no time. We’re able to get you approved and funded ASAP, with no credit checks and minimal paperwork. And your personal loan consultant is with you every step of the way to make sure you’ve got everything you need to grow… and then grow some more. Apply today!