Competition plays a key role in business; it creates a healthy flow of supply and demand, creates a fair market for consumers, and fosters innovation for more effective solutions to the world’s problems. That being said, building a business in a competitive environment can be difficult. Here are four tips on how to do just that:
Look For a Need
Every good business idea comes from a clear identification of a consumer need not being met. Look for that “need” within the market you are looking to penetrate, whether it’s food or tech. For example, if you notice a particular ethnic cuisine is heavily poultry-based, you could step in and create vegan or vegetarian alternatives for customers who want to enjoy the same ethnic dishes but are unable to eat meat for dietary restrictions or personal beliefs.
Be At Your Industry’s Center
Just as many tech startups set up their base in San Francisco and a lot of food trucks or eccentric restaurants make their way to Los Angeles, you’ll want to live in your industry’s main hub, wherever that may be. It’s an easy way to get initial brand recognition for your business and gives you a better idea of who you are dealing with, what customers you should be targeting, etcetera.
Know Who the Key Players Are
Knowing that your industry is competitive isn’t enough; you need to know who the players are. This includes competing businesses, suppliers, distributors, technologies, and substitute products that your customers may choose as an alternative. Knowing who your competitors are, how they operate in the market, which consumers they are targeting, and what particular needs they are addressing can help you position yourself competitively, whether it’s with a diverse offering or a better price point.
Cover the Basics
Study the culture that envelops your market, including the varied lifestyles and values that make up your target audience. Knowing the present culture of your market helps you determine where it’s headed in the future and thus allows you to position your brand message, product/service offerings, and marketing campaigns accordingly.
A competitive environment should not be avoided, but rather entrepreneurs should learn how to navigate around it. Use the four tips aforementioned in this article to lay the foundation from which you can slowly build your business in its respective niche.