This Is How Competition Will Save Your Small Business
When a business succeeds in an industry many have failed in (or still haven’t figured out how to scale), many more businesses jump onboard in an attempt to take a slice of the cake. This unavoidable behaviour that springs up with every new success, creates competition amongst every business in a sector, thereby causing ripple effects that eventually create many other factors.
Is business competition then good for any industry? If so, how does competition in business help active players grow?
While many entrepreneurs dread competition, and would rather try a business (with lesser direct competitors) that doesn’t really generate as much income as what they initially would have wanted to do, competition is still crucial to their growth and success.
Here Are 7 Reasons Competition Is Good For Your Business:
1). It Helps Lazy Entrepreneurs Stay Alert:
Every internet company’s worst nightmare is waking up to read that Google has decided to build a competing business in their country or on a global scale. Although using a Google example could be a far cry, having several other small business owners starting up a direct competing business can send a little (or a lot of) tension up your spines.
When entrepreneurs realise they have some form of business competition, they begin to do things more efficiently, by addressing issues and making many other crucial decisions on time.
Whether an entrepreneur is lazy or not, knowing there’s a new player that could knock them out of the market, subtly if not largely, increases their zeal to work harder.
2). Forces An Improvement In Customer Service:
When your direct competitors start to care about your customers better than you do, you begin to lose your hold on them. Business competition creates an avenue for better customer service. Since everyone is trying to claim some market share for themselves, they’d do anything to make the customers believe they should trust them better than anyone else. They’d offer unbelievable incentives, deliver better customer service, and offer more gratifying experiences.
This sole reason is a core importance of business competition.
Without direct competitors, customers suffer, and sometimes, may not even know they’re been cheated by the only business they patronise for whatever product or service.
3). Promotes Innovation:
Business competition drives a need for innovation. As a lone player in an industry, you’d majorly not care about improving your products or services. But as new players come in and begin to either silently or aggressively disrupt your market, innovation becomes critical.
Innovation is crucial in the work-cycle of every great business. It ensures differentiation, and sets you apart from your direct competitors.
See Also: 6 Startup Tips for Women Entrepreneurs
4). Turns Your Employees Into Rockstars:
When there’s heavy or mild competition in an industry, employees continue to learn newer and better ways to carry out their activities for optimal results. Business competition basically ensures employees get a lot better, due to the newer trainings they’d go through, and the experiences they’d gain from the challenges.
The events that employees experience, especially in a highly competitive industry, would make them the best they can be in that field within a short time.
5). Helps You Identify Your Strengths And Weaknesses:
Competition literally brings out the best in your business. It helps you understand your strengths and weaknesses, which subsequently helps make you stay focused on your core niche.
Without competition, you’d never realise some aspects of your business that could have given you a stronger hold over your customers.
6). Makes You Produce Faster And Smarter Work:
With the existence of direct competitors in your industry, your work-rate would naturally get faster, smarter, and generally more effective.
Any business that doesn’t change it’s attitude to the market with newer players constantly entering, is setting itself up for a surprise hostile takeover.
More competitors must always mean more efforts on your side. As long as other businesses keep entering your sphere, you must not just improve your services, but also work faster and smarter!
7). Lowers Business Costs:
Although a lazy approach, business competition reduces your market research costs. As more businesses venture into your sector, they’d carry out market research, and try out new things. As they do this, some of their experiments would work, and some wouldn’t.
As these new businesses conduct market research, it’s important you pay attention to their activities, while running your operations. As they discover newer things that work, you could apply some to your overall strategy. This move would give you a little more experience that you could have spent a lot of money to acquire.
What are your thoughts on these 7 reasons competition is good for your business? Let me know by leaving a comment below.
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