As somebody who is a bit of a sports fanatic, I am always interested with how business owners view their competition. In sport clearly competition is good, partly because otherwise it wouldn’t be entertaining, but also because it actually improves the players. Men’s tennis over the last 20 years or so has been a fine example with Federer, Nadal, Djokovic and a fit Andy Murray having to push to extremes to beat each other.
Governments also see competition as a good thing with statutory authorities having been set up to “ensure healthy competition between companies in the UK for the ultimate benefit of consumers and the economy.” (Wikipedia description.) So should small and medium enterprises see competition as good too?
When we should embrace our competitors
The very fact that there is competition is a good sign – it shows that there is a market for whatever you are offering. As a small business owner I always ensure that at networking meetings I go and talk to any people who appear to be competitors and see whether we can work together. Here’s why:
- I like to take holidays and occasionally I may even be ill – by working closely with a competitor I have an expert in my field who can cover for me and of course I reciprocate.
- Sometimes I am at capacity and can’t take on a job for whatever reason, being able to recommend another person is good PR and they will probably do the same for me at some point.
- Although we may appear to be competitors our skills may in fact be complementary – for example I don’t want to get into booking a clients’ train travel and holidays, but another VA enjoys that side of the work, so sometimes we share clients for specific pieces of work.
- There is plenty of work to go around, so collaborating with other people in a similar industry means that you can learn from each other and share information.
Will Competitors Steal my clients?
I know a few people who get obsessed by the competition, but in my experience if you do a good job and value your clients they will stay with you and value you. I have found that there are generally three reasons people go to your competitors:
- You don’t do a very good job for them – this could be correct as we all make mistakes or stretch ourselves or they might perceive you don’t do a good job for them. If the latter is the case then you need to ask yourself whether you want them as a client. If the former is the case, look at what went wrong and learn from it.
- Price – there will always competitors who will do what you do at a crazy low price. I have wasted a lot of time trying to put together products that compete at the lower end of the market. But, as I was told many years ago, people who go to you because you are the cheapest will soon move on if they find it even cheaper. By going for the cheapest end of the market you are not valuing yourself and guess what? Your clients don’t value you you either.
- Not committed – I have gone to many networking events in the past and many of these are driven by referrals. When this happens you tend to get people who use you because you are the person in that category at the time. If you leave the group and a competitor joins they are likely to do an “easy referral” and use that competitor instead.
Should I Worry About my Competitors?
It is certainly useful to know about your competition, whether it be local or global so that you can decide what your selling point is. Personally, however I would rather take my cue from the sports world and a rather splendid book called Two Lengths of the Pool by Simon Hartley which looks at how you can make yourself the best you possibly can.
“The simple truth is that if Chris swam as fast as he could, and someone else swam quicker, they would win. If he swam as fast as he could, and nobody swam quicker, he would win.”
So, we look at ways of being as good as we possibly can. This means we have loyal clients, who value what we do. If we lose clients, which we do, we will look at what we can do better next time to improve how people value us and what we offer them.
So, just as in sport, competition improves what we offer to our clients.