The first step toward gaining an advantage on your competition is to take an objective look at your business. Conduct a brainstorming session with your key staff to perform a formal SWOT (Strengths, Weaknesses, Opportunities and Threats) analysis. This analysis will give you insight on how your strengths stack up against your competitors' weaknesses and suggest ways to take advantage of marketplace opportunities.
When conducting a SWOT analysis, the following outline should be used:
Consider your company's strengths. What do you think they are? What would your customers say they are? Don’t be too boastful or too modest. Be realistic.
- What advantages does your business provide customers?
- Why do customers do business with you?
- What is unique about your products or services?
Evaluate your weaknesses. It’s time to take off the gloves and be brutally honest. When reviewing your business for weaknesses, also think about what your competitors think you are.
- What product or service can be improved?
- What do your competitors do better than you?
- Do competitors have a particular market or segment locked up?
Invite participants to suggest growth opportunities freely. There are no wrong ideas at this stage. It’s not only about taking advantage of changes in regulations and trends, but also stumbling upon the next big thing before anyone else.
- Are there changes in technology that can benefit you or your customers?
- Are there changes in industry policies that can benefit you or your customers?
- Is a competitor closing?
How can you protect yourself if you don’t know what could harm your business? Even the most successful businesses face threats. However, the businesses that stay on top are those that keep an eye on the competition and guard against potential danger.
- How can you prepare for potential problems such as a depressed economy, shift in market demographics, or new competitors?
- In what ways is your business vulnerable to the competition?
- Are there new industry regulations or policies that could negatively impact your business?