Fight back against new competition
Published in The Tennessean October 20, 2014
By Ed Rappuhn – SCORE Nashville
“We’ve been the ‘only game in town’ and things have been going great but now we have competition. I’m worried that our customers will begin leaving.”
Wouldn’t it be great if once we had a good thing going we could just ride the wave of success? Unfortunately, when business is good, others will see opportunity. If you keep doing things the same way you always have, the competition will find cracks in your armor and infiltrate your customer base.
You can sulk, stubbornly remain the same, and watch your customers disappear or you can change what you are doing and retain, maybe even grow, your business. Go with the second option; change. Look throughout your business model to see where you can improve.
The first place to focus is customer relationships and service. When you have no competition, you might be lax in this area; where else will customers go? Make their experience with you so good that going somewhere else is too painful or dangerous to consider. If you do lose customers, ask them why they left and what you can do to bring them back.
Next, look at your value proposition (products and services). Can you add to the value perceived by your customers? Can you add a new or repackaged offering? Are discounts available for loyal customers? Can you unbundle services to provide only what the customer really needs?
Now study your customer segments. Are you missing a segment or should you discontinue one?
Then look at how you create your value proposition. What can you do with your current resources to create new or improved offerings? What about your activities? Solidify great partnerships and consider changing others.
Too often we rest on our laurels when things are going great. It’s possible that competition coming into your market is a good thing. It means others have recognized a good market opportunity. Also, it makes you reevaluate your business model to look for growth opportunities, efficiencies, and other changes that will make you a stronger business. The trick is to act promptly and decisively. And in the future, act proactively. If you consistently improve what you are doing, customers will appreciate your commitment to making their lives or businesses better making the threat of competition less of a concern.
Think of a restaurant that has had a virtual monopoly in an area of town that is reinventing itself. All of a sudden others are moving in right and left, but it’s now a destination point rather than only a neighborhood spot. It’s time to do some things differently, but it’s also a great opportunity for new growth.
Embrace change and make it work for you.
Ed Rappuhn is a mentor, workshop facilitator, and the past-chair of SCORE Nashville. SCORE mentors guide entrepreneurs in starting and growing their businesses. Sign up for a free SCORE mentor, find out about our reasonably priced workshops and other services, or volunteer to become a SCORE member at www.scorenashville.org.