Your Competitive Advantage – Is it Strong Enough?
Your competitive advantage must be something sustainable, something that would allow you to survive for a more extended time. You must recognize this as the act, not only on the paper in your marketing plan.
Maybe you think your competitive advantage is because you sell your products and services at a lower price. However, this is not an advantage if it is a temporary solution to attract new customers because your business can’t continue to sell at that price.
However, suppose you have an innovation in the manufacturing process and appropriate cost management. In that case, you can have a lower cost than the competition, and therefore, you can sell your products at a lower price. That is a competitive advantage for your business.
Strategy, Tactics, and Actions for Competitive Advantage
As an entrepreneur, you must have a strategy that will enable you to beat your competition and, at the same time to have tactics that will ensure the execution of this strategy.
In the post titled as The Quickest Way to Transform Your Small Business Results, we conclude that:
Strategy is a plan of actions for achieving the set of goals that our business have. To implement a strategy it is necessary to have more tactics. For example, if our strategy is to build long-term business relationships with our customers, the tactics that we can use for implementing them can be to provide additional services to regular customers, training, long-term contracts with lower prices, etc. Each tactic has specific activities that must be completed in a specific period of time, and responsible persons for the completion of those activities.
So, you must prepare a strategy for achieving that competitive advantage. This strategy will have tactics that you will use for the execution of the strategy. Each tactic will contain all necessary actions that you must take.
Define Tactics to Achieve Competitive Advantage
For example, each business sells some value for its customers. You will have to find out how that value will be better than the competition and how to distribute that value in a better way than your competition. It will be your competitive advantage. For example, your tactics can be:
- Offer value at a lower price,
- Provide a faster delivery,
- Provide better quality,
- Or, provide better service.
Define Activities for Each Tactic to Gain Competitive Advantage
For each tactic, you must define and delegate activities that you must implement for those tactics, and through them, you will enable the execution of the strategy. For example, if we take faster delivery tactic activities could be:
- Analysis of the production process,
- Analysis of the supply chain,
- Also, analysis of distribution channels,
- Detection of all time that doesn’t add value,
- Elimination of all time that doesn’t add value…
This is just an example. In reality, the list will be much longer and more comprehensive.
Know Your Competition to Gain Competitive Advantage
When it comes to building a competitive advantage, the competition would be your milestone in building such an advantage.
Entrepreneurs must always look at the competition. It would help if you answered the following questions:
- What are the key competitors?
- What is the value that they offer?
- Or, what is their behavior?
- What do they do?
- How do they do, what they do?
- How their customers accept their offers?
- Is there something that lacks in their offer?
- Can you add in your offer everything that missing in their offers?
- What is the comparison between you and them?
This will help you discover whether your competitive advantages are strong enough to overcome the competition and benefit your business.
When it comes to competition, you must prepare yourself that the competition will respond with their strategy, tactics, and actions for your strategy. Their purpose will be to begin reducing your competitive advantage. Because of that, the competition will require constant modification of your strategies, tactics, and activities that you use to ensure your competitive advantage.
Is your competitive advantage strong enough? You will know when you make the analysis. Do you have a strategy for achieving a competitive advantage?
