The gift of competition
By Shirley Sommer
May 7, 2017 at 9:43 p.m.
Updated May 8, 2017 at 1 a.m.
I don't know any business person who would initially say, "Oh, good, competition is coming," but maybe it wouldn't be a bad response.
Don't get me wrong - being a small business owner is tough. Even statistics show that only 1 in 5 small businesses will be in business after five years, so having someone else "take a piece of the pie" is very nerve racking.
Here are some facts about competition:
1) Businesses can't avoid competition
2) Businesses that try get into legal trouble because of anti-trust and price fixing laws that date back to the Sherman Act of 1890.
So, what is a small business to do when a competitor shows up down the street?
• Stay true to what has worked for you. Don't be a copycat. Like a driver in a car, when you start taking your eyes off the road, the car starts going off course. The same is true with small business. Stay with your business plan and if you don't have a business plan, now would be a good time to develop one and know where you (and your customers) want your business to go.
Don't underestimate the competition. You may lose sleep over bigger competitors with their impressive cash flow, customer base and power, but smaller competitors can pose a bigger threat. Know your market and by knowing your market know the competitors - large and small.
Focus on the customer. Business is often more about relationships than price. A satisfied customer is the essential point. Evaluate your relationship with your customer and not just the product. Is purchasing your product easy and enjoyable? Customers are often more loyal to businesses they have a relationship with, no matter what the competition is doing.
Focus on your employees. Because customers value relationships, customers may follow employees who move over to the competition. Now is a time to get some honest feedback from your employees. Good employees are your most valuable asset so protect them from going to the competition.
Think about cooperating. Often choice actually draws more attention and therefore more customers. Co-marketing with other businesses, including the competition, often draws more attention for the money and helps develop a market niche. Think about the "Texas Barbeque Trail" or "Canton Trade Days." These are all small businesses getting lots of attention as a group, therefore more customers individually.
So why is competition a gift? Well, unfortunately, not until competition shows up do most small business owners raise their heads from the day-to-day grind to take a good look at their own business and where it is heading. Sometime this can be too late, but often it is the kick that gives a stale business the same enthusiasm as when the doors were first opened.
The choice is yours. Nothing keeps competition away like a strong business with satisfied customers and happy employees.
Shirley Sommer is a business advisor with the UHV Small Business Development Center. The UHV SBDC is part of a nationwide small business assistance program serving the small business community and federal, state and local governments. The center offers counseling, training, and technical assistance to existing and start-up businesses in an 11-county area. To make an appointment for business services or register for a UHV SBDC workshop, call the center at 361-485-4485 or email at firstname.lastname@example.org.