Why Competition Is Good For Your Business

 

Why Competitition Is Good For Your Business image

 

A competitive world has two possibilities for you. You can lose. Or, if you want to win, you can change.”Lester C. Thurow, Dean, Sloan School of Management, MIT

Many business owners are afraid of competition.

But, competition is essential for both your business and your customers. Why?

It wakes you up!

Competition challenges you by threatening your livelihood and reputation. It makes you decide whether to stand and fight or surrender and be eaten alive. Today, many businesses are fat, and lazy and stupid. They underperform in almost every area and rationalize their behaviour with lame excuses. Not convinced?

  • Why is customer service the number one customer complaint?
  • Why do businesses spend more on attracting new customers than on building customer loyalty?
  • Why do employees lack the skills and knowledge that customers demand?
  • Why do businesses consistently frustrate when customers want to be wowed?
  • Why don’t businesses deliver personal attention?
  • Why are employees demotivated and unreliable?
  • Why do businesses believe it’s acceptable to break their promise?

In business, you have to be better than your competition. You have to be faster, smarter and stronger and always be alert to what your competitors are doing, while keeping them second guessing. To survive and thrive you have to focus on being number one. That takes education, enthusiasm and hard work.

Advantages of Competition

Competition forces you to focus on your customers. It motivates you to shut up, listen to them and understand their needs. It pushes you out of your office and forces you to really connect with them. Only when you know more about your customers and their individual preferences can you make informed decisions to win their hearts and wallets.

Competition forces you to critically look at your products and services with an eye to innovation. It makes you leave the comfort of your business and go and look at your competitors to see what they are doing right that’s costing you a customer. This gives you an opportunity to borrow, reverse engineer and improve. The best ideas are a compilation of others ideas. You need to go out looking to find them. This also gives you the opportunity to look for gaps in the market so that you can differentiate yourself. Businesses offering the powerful combination of low prices, high quality, better service, merchandising and convenience are winning.

Successful businesses have effective systems. Look and learn from your competitors’ systems so that you can eliminate waste and inefficiency and give your customers what they want every single time.

Michael Gerber said, “Organize around business functions, not people. Build systems within each business function. Let systems run the business and people run the systems. People come and go but the systems remain constant” E-Myth Revisited.

Competition motivates you to look more critically at your business costs. Efficiencies and even small cost reductions can make a big difference to your bottom line. Ask your staff for ideas. This often untapped reservoir can be a goldmine. Reward them for every idea you implement and they will become your in-house auditing department.

Are your employees unmotivated or lack skills? The stronger your competition, the better they need to be. You want your people to be the very best, don’t you? They are your most valuable asset because they run your business. If you don’t believe me, why don’t you send them home for a day and try doing everything yourself? Competition forces you to clear out the deadwood, and to invest time, energy and money into educating and training your team. How can you possibly hope to beat your competition otherwise?

In his groundbreaking book “Outliers”, author Malcolm Gladwell explained that the key to success in any field is a matter of effectively practicing a specific task for a total of around 10,000 hours.

10,000 hours = 3 hours a day, 20 hours a week for 10 years

So, how many hours have they completed?

Competition requires you to stand up and be a true leader. It requires that you examine yourself and identify the areas where you need to improve. If it’s your health, give up bad habits, eat well, and exercise. If you feel you need to handle stress better, learn to meditate. If you are unsure how to do something in your business, educate yourself further and get help.

The success or failure of your business is up to you. In a competitive environment only those who change quickly, who change effectively and who change frequently will succeed.

 

Leon Skaliotis

Leon Skaliotis is Founder and Principal Advisor of Retail Fundamentals. With over 30 years experience in specialty retail, hospitality, financial, franchising and advertising industries services, Leon has gathered, learned and distilled the best ideas, practice, systems, techniques, strategies and success principles that have made average businesses great, and struggling business owners realize good health, wealth and prosperity.
Together with his own knowledge and experience, Leon can draw on the expertise of many partners, (each an expert in their own field), to consult business owners and advise on ways to grow revenue through building, analysing, and improving customer experience programs, supplier relationships, financial advice, exit strategies, staff acquisition and retention, and internal and external marketing strategies.

Leon Skaliotis
M: 0425 833 344
E: leon@retailfundamentals.com.au

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