When budding entrepreneurs are planning their startups, there are a lot of things that they’re usually at least a little afraid of. And one of those things is competition. They fear the competition that’s coming from the big sharks in their industry and they fear the competition from the startups that will be about the same size and age as them. It’s a pretty daunting prospect, having to face these rival businesses.
But it’s worth remembering that competition is a great thing for business. Not just because competition helps in the fight against the existence of monopolies ( which are, at least most of the time, bad things ), but because they force companies to do a lot of things that end up being pretty good for business - and also very good for the consumers.
We’re going to take a quick look at competition in business; the good it can do and how you should deal with it. If you’re planning on starting a company but are still afraid of the other fish (and sharks!) in the pool, then read on.
Fighting for the champion belt
During the early days of a business, the competition don’t usually end up being that much of a concern. The fact is that a lot of other businesses that are already established don’t tend to pay too much attention to the startups that are on the horizon. (It could be said this is a mistake on their part, though.) What this means is that you should take the increasing problem of competition in your business plans as a good sign: it means you’re growing, and that other businesses are worried.
The existence of other businesses vying for the champion belt also means that the territory you’re in isn’t exactly unmapped. Those who have come before you and those who are still in business will have made a bunch of errors as well as a few wins. This means there’s a lot of data and history you can research that will help you stay ahead. Find out more at SmallBusiness.Chron.com/business-research .
Expansion of creativity
Competition often forces us into somewhat of a box, which a lot of people would argue it pretty stifling. It certainly doesn’t sound very comfortable and free to be inside a box, that’s for sure. But when you’re placed in a box, or a corner, or whatever similar idiom you want to use, that’s when you creative juices really start to flow.
Competition drives us to be more creative; it forces us to expand our toolset. Ever been in a situation where you’ve been more productive under pressure? It’s this sort of phenomenon that helps businesses in tight competition. Just remember not to let those pressures translate into an abundance of stress, which will eventually work against your productivity! See TowersWatson.com/Workplace-stress for more details.
What the competition are up to
Of course, the whole “competition is great!” thing often seems like it can only be taken so far. After all, it’s not as if you know precisely what the competition are up to all the time. And it’s not as if it’s always a fair and productive game when it comes to business competition, either. Some competitors get pretty sneaky about things. Think that corporate espionage is just a thriller-movie myth? Think again . They may also be skewing data slightly to make themselves sound better at your expense. This is something a lot of businesses do, unfortunately. How can businesses deal with this sort of thing?
Perhaps the best way to do this is to simply keep track of your main competitors (not that you should ignore the smaller, newer fish, though - after all, if you’re in a position to worry about bigger competitors, then it’s worth remembering that you were that smaller fish once!). Keep an eye on their stock, their social media accounts, their website, their prices, their news broadcasts, their recent hires, etc. Of course, paying too much attention to this might end up damaging your business if you’re doing it at the expense of other actions. You might want to consider outsourcing these tasks. For more information, see Chatmeter.com/solutions/agencies
The salary problem
The problem with dealing with business competition is that people often forget just how many things it can affect. You may only be thinking about productivity, sales, and reputation. (Well, I say “only”, but that’s a lot to think about!) This may lead you to forget some other factors you need to take into account. Let’s say your business is booming and that the competition are worried. Who helped get you into this great position? Your employees. And your competitors know it. What do you think the competition are going to do about that? (If your answer was ‘assassinate my employees’, then you’ve been watching too many thrillers.)
Competitors are always on the hunt for great talent, and your success means you’ve got great talent. So, as is often seen in the business world, they may attempt to attract your employees to their business. They may email them directly, or place targeted job advertisements within the area or industry. Here’s what you need to be concerned about: the offered salary.
You may not want to hear it, but the vast majority of employees at any business are mostly in it for the money. They may enjoy their job, they may even love the company and want it to do well - but at the end of the day, it will probably be hard for them to resist a bigger paycheck. After all, research has shown that those who stay with a company for two years or more end up getting paid less than those who jump from job to job. Read more at Forbes.com/cameronkeng .
So if you’ve got employees that you know are worth a lot to the company, then make sure they know it. And as much as some would like to say otherwise, remember that money talks much louder than mere “thank you”. Though displays of gratitude are also important , so don’t not say “thank you”.