Small Business Strategy: 21 Ways to be a competitor, not an imitator

Small business planning - be a competitor, not an imitator

The academics who roam the halls of the Harvard Business School will tell you that there are really only two basic ways to compete in business:

  • Price
  • Product/service differentiation

That’s probably true, but within each of those categories – and especially within the differentiation category – there are many variations or strategies you can use as a small business owner. You need to fully understand these to be successful when you sit down to do your long and medium-range small business planning.

The reason many small businesses fail is because customers see them as imitators, not as competitors, so that is the first question you need to honestly ask yourself: Am I really competing in this industry or are most of my efforts going toward imitating what others are doing, or have done?

To help you answer this, and point you in the right direction for your small business strategic planning, here is a list of 21 ways you can set yourself apart from the others in your industry and establish your small business as a competitor to be reckoned with. Many are strategies to help you differentiate your product or service. Others will help you get a price/value advantage. Some do both and those can be the best ideas for small business growth and long-term success.

  1. Go boutique. Take your product out of the commodity market. If what you provide is a commodity, the only arenas where you can compete are price and service – and adding a higher level of service usually comes with a higher price tag, so it is difficult to achieve.
  2. Know your customer better. If you work hard to understand your customers, you’ll be able to better anticipate their needs than your competitors. Your customers will sense this.
  3. Nurture relationships with your customers. This is similar to the previous point, but I want you to look at it from the customer’s point of view for a moment. As you’re learning more and more about your customers, are they seeing it as your attempts to make sales or as your desire to serve and help them? Build relationships with your customers that go much deeper than selling them the next item you put on sale.
  4. Target your marketing better. The above items lead to this thought. If you can take your product out of the commodity market and you know your customers, you can better target your market. Do A/B testing. Always be refining your marketing. Don’t get lazy.
  5. Have a better loyalty program. Strong loyalty programs keep customers coming back for more. Is yours superior to what your competitors offer?
  6. Give something unexpected – extras. There may be nothing more memorable or loyalty-creating than to get something unexpected in a business transaction. For example, if you sell bicycles, offer a six-month tune up.
  7. Tweak your product or service to open a new market. A new market may be consumers or businesses in your local area who would use your product or service with just a few small changes, or it could be overseas and you just need to translate some materials.
  8. Have superior employees. I’m willing to bet that you patronize some local businesses just because the people who work there are so nice or helpful. Hiring, training and rewarding your team to make them the best in the business is probably the smartest investment you can make.
  9. Be the most efficient. The most damaging phrase in business is, “We’ve always done it like that!” Replace that with, “We’re always looking for ways to improve.” Greater efficiency is the oil that lubricates small business strategic planning success. With greater efficiency you can keep your prices low and make it easier to meet customer needs.
  10. Do things faster. Speed is a major differentiator today. Why do you think innovators like Amazon are offering same-day service and trying to find ways to make deliveries by drones? Here’s a simple question: Are you faster or slower than your competitors?
  11. Be easier or simpler. Along with speed, “user friendliness” is a major quality buyers are looking for. Have you ever delayed going down to the department of motor vehicles because you knew what a hassle it was going to be? Don’t let your customers experience that vibe with your small business. Simplify.
  12. Have better packaging. It’s a fact that we judge books by their covers. Sometimes packaging catches our attention, other times it can be superior because it is more useful or easier to work with.
  13. Be more ethical, environmental or charity supporting. Today, and even more so tomorrow, an important part of small business strategic planning will be deciding on how to promote the business’ devotion to ethical causes. If your small business supports local charities or is eco-friendly, it can be the differentiation factor that prompts many consumers to do business with you.
  14. Be local. This relates to the last point often in strategic planning for small businesses. If you have a big corporate competitor, communicate your local connections and commitment. Be real and authentic. You can’t fake sincerity…at least for very long.
  15. Be more convenient, offer better hours. Have you noticed all the boutique healthcare services that are springing up as a counter to the more regimented healthcare services that have resulted from increased federal regulations? I think more doctors are making house calls today than since the 1950s. Maybe your business could have a “mobile” feature added to it.
  16. Offer better payment options. This could be better terms, more ways to pay (Paypal for example), lower down payments, layaways, or other strategies to make payments easier for your customers or clients.
  17. Offer a better guarantee. Virtually everyone I talk to who offers a “100 percent money back guarantee” discovers that it’s good for business. Consumers don’t abuse it. I know that I always closely review the warranties offered by car manufacturers.
  18. Find a better location. Are you in the best location? Is your location better than that of your competitors? Don’t settle for second best; it could make or break your business in the long term.
  19. Be higher quality. We all have built in meters that are constantly checking and comparing the quality of everything around us. If you go to a new burger place in your town, you immediately judge whether the burger is better or worse than the restaurant where you usually grab a burger. If your product is better, people will catch on.
  20. Give better service. The same quality principle applies to service industries, although sometimes the judgment takes longer. Giving better service can also mean giving “more” service.
  21. Give the greatest value. At the beginning of this article I said that price and differentiation were the basic categories where businesses compete. The lowest price isn’t always perceived as the greatest value. Value is an attribute that will ultimately depend on a combination of price, quality, features, guarantee, convenience, and probably everything I’ve mentioned in the previous 20 points.

As you do your small business planning, you can probably think of ways many of these ideas can be applied to your operation. Pick the ones that you believe are the best small business ideas and run with them.

Don’t expect to see huge results overnight. Remember, you’re in this for the long haul. Small business success is a marathon, not a sprint. However, if you’re diligent in your small business strategic planning, at the end of the day you’ll find that you’ve built a true competitor, not a mere imitator.