1. KNOW YOUR COMPETITION

2. Impact of Competition Economic system is based on this principle
Defined: companies offering similar or identical products to the same target market
Why is it important to understand the competition your business faces?

3. Types of Competition Direct Competition: Indirect Competition:
Comes from a business that makes most of its money selling the same or similar products
Obtain information from secondary data
Phone book, internet, Chamber of Commerce
Indirect Competition:
Comes from a business that makes only a small amount of money selling the same or similar products

4. Direct Vs. Indirect Competition
Who is their Direct Competition?
Who is their Indirect Competition?

5. Large Retailers
Can be a source of direct and indirect for many small businesses (ie: Walmart)
Usually are able to keep larger quantities of product in stock
Do not rely on a single product line
Usually have more resources to devote to advertising/promotion

6. Competitive Analysis
Analyzing the strengths and weaknesses of your competition; identifying and examining a competing firm
Make a list of your competitors
Summarize products offered by competitors
List competitor’s strengths and weaknesses
Find out strategies and objectives of your competitors
Determine the strength of the market

7. Competitive Intelligence
Visit competitor’s outlets
Buy your competitor’s products
Search the internet and your competitor’s website

8. Competitive Advantage
Defined:
A feature that makes a product/business more desirable than it’s competitors’ product/business
Partner Activity:
What are some ways that businesses gain competitive advantage?
Choose two competing businesses and explain their competitive advantages?

9. Maintaining Customer Loyalty
How do we ensure customer’s keep coming back?
What are some strategies you could use to develop customer loyalty?

10. Customer Loyalty Listen and respond to feedback Superior service
More convenient hours
Easy return policies
Store specific credit cards
Personal notes, thank you cards
Frequent buyer programs