When formulating your business strategy, you can never neglect to understand what your competition is doing. It’s an important piece of the equation that many small business owners often neglect to explore indepth. True, it is sometimes difficult to find out what the competition is up to short of diving through their dumpster or staking out their location, but there are ways that you can find the information you need to make an accurate comparison of services and/or products.
- Asking the right questions. Start out by identifying the information you want to gather about the competition. Are you wanting to know what products and services they offer in comparison to yours? Do they offer products/services similiar to yours? What are their benefits? What’s their target audience? What’s their sales mix? Asking the right questions will make all the difference in not just what information you gather, but how you will go about obtaining it.
- Look inward. If you want to do an apples to apples comparison between your own company and the competition, you will need to get a solid handle on your own company first. Review (if applicable) your financial data, marketing plans, product plans, distribution processes, supplier relationships, productivity figures, etc. so that you will be able to see the differences and similiarities between your competitors and yourself.
- Leave no stone unturned. Did you know that probably three-quarters of the information you’ll need in order to research a U.S.-based company is available publicly, in the form of regulatory filings or legal documents? It may involve a lot of leg work, but the answers you are seeking are most likely lurking out there. Public companies have SEC filings and other legal filing requirements. Private companies are a little more difficult to research, but try Hoover’s and Dun & Bradstreet for starters.
Another great avenue to pursue is legal public records. If the company has been involved in a lawsuit, they may have revealed company information in the pleadings that are now public record. Also, check out the appropriate local government offices. They often contain a jackpot of public documents, such as building blueprints from the planning department or staffing details from the tax assessor.