In the previous article, we talked about how competitive analysis entails finding who your top competitors are. Knowing the enemy is part of basic military strategy and in business, the best information comes from the best competition.
Your top competitors are one of the most valuable sources of information, since their business methods and strategies have already been proven to work. By learning about the top competitors, you now have a general idea of what you are up against.
For the next step in competitive analysis, we go to your business. It begins with the question – where do you stand?
You already know the enemy, how he works, how he operates. Now go to yourself, to your business. In the process of doing a competitive analysis, a self-assessment of the business can be a big help. Try to answer questions like these:
- How well do you really know your business?
- How does it operate?
- In what areas are you strong and in what areas are you weak?
- What areas can you improve?
In trying to find out where your business currently stands, one important thing to consider is the market share. In finding out about your top competitors, you will have probably discovered how much of the market does each of them cover. From there, you will be able to measure and compare how much of the market can you cover, and whether there is room for you to improve and expand.
Knowing the status of your business is another step in doing a good competitive analysis. In the process, you will now start putting to use the information you gathered about your competitors. For instance, your opponent’s weaknesses might be your strong points.
By understanding more your business, you will be able to identify which areas need fixing and which areas can be enhanced. This is not an easy process and you may need outside assistance. It’s always good to get another perspective.