Business Plans For Dummies®, 2nd Edition

Chapter 7. Scoping Out Your Competition

In This Chapter

• Understanding the value of competition

• Identifying your real competitors

• Making use of strategic groups

• Tracking competitors' actions

• Predicting competitors' moves

• Organising competitive data

Spending time with the competition isn't anyone's idea of fun. Think they're out to get you? You bet they are. But the more you learn about the competition, the better off you'll be when it comes to figuring out what they're up to. The competitor that you're familiar with is much less dangerous than an unknown enemy out there.

If you've neglected to think much about the competition so far, you're in good company; many businesses fail to take this part of planning seriously. Here are the typical excuses:

There's no way to know who all of our competitors really are or what they're up to anyway.

or

We already know everything that there is to know about them. We compete with them every day.

Business owners or managers in the first group wring their hands because trying to find out about the competition is tough. Those in the second group cover their eyes, assuming that if they don't look too hard, nothing bad will happen. Both groups are making a big mistake.

Note

When the Japanese decided to become global players in the car industry in the late 1960s, they planned carefully. They knew what they had to do, because they'd been taught by American business experts. First, they had to understand the consumer markets in the United States and Europe; second, ...