With the online market, as well as physical markets, getting more competitive, businesses, especially small businesses are finding it harder to maintain a competitive advantage and stay afloat. Many of these small businesses sell generic items which are commonly found in hundreds of other stores. This makes it impossible for them to attract clients based on a unique product. This is because they have nothing to offer that customers can’t buy online or buy from a store that is closer to them.
So, these businesses need to look elsewhere to find things that they can use to differentiate themselves from the crowd. They need solutions that will allow them to streamline their processes. But, in such a way that they can make their businesses profitable enough to compete.
Here are a few things that businesses can do to bring back that competitive advantage to help them stay in the fight.
1. Understand Clientele for More Competitive Advantage
Just as markets and economies are changing, so are clients. Just as businesses are growing with the implementation of technology, consumer trends and behaviors are also changing. There is an entire process that you can follow to understand where your sales are coming from. Simply, categorizing clients by the willingness to spend and most preferred products is not enough. You need to have an understanding so precise that you can mold your business to meet those requirements.
2. Optimize IT Infrastructure
It’s great that you are using technology and you are investing in digital solutions to make your business perform better. But, are you making the most of these resources? Moreover, there are ways in which you could further reduce your operational costs and improve functionality. For instance, rather than relying on in-house software, you might want to consider cloud hosting service providers who can help you do everything from data management to accounting to HR processing. Technology is very different from what it was just 5 years ago. You need to make sure you are using the best solutions. Investing in IT infrastructure can become your biggest competitive advantage.
3. Don’t Create Price Wars
Not only are these bad for your individual business, but they also ruin the market for the product on which you are having the price war. This makes business bad for everyone selling that product. There are few upsides to price wars and in the long run. But, they usually cost businesses more than they benefit them. At the end of the day, everyone is in business for profit and even though it’s harder to generate value, that’s the only way you can build a long-lasting profitable enterprise.
4. Invest In People to Achieve High Level of Competitive Advantage
Small businesses often make the mistake of keeping the same people with the same skill set and then wondering why they aren’t making any progress. The company is the sum total of the abilities of the individuals that constitute it. If the individuals aren’t improving, the company isn’t growing. As a business owner, it’s your responsibility to up-skill your team so they can help the business grow. Sometimes, the right people can become your biggest competitive advantage.
5. Rethink Marketing
If you are relying on a few marketing principles that aren’t bringing in a ton of clients, maybe it’s time you reconsidered your marketing approach. Even if it’s working well for someone else but you aren’t getting results, the wise thing to do would be to switch to something else and try out something new. This is one of the reasons why it’s really important to know who your clients are. You can devise a marketing strategy that will target specifically those people. In such a way, your message will go to those that are most willing to buy. You can save a lot of money if your marketing is focused and gets you results. In such a way you will achieve a competitive advantage. You will need to market in any case, might as well get the most out of it.
If a business is slow and everything in terms of internal processing is up to the mark, maybe you need to evaluate the broader market. Just because a product sold great for the past ten years doesn’t mean it will continue to do so for the next decade. There is a strong possibility that it’s time to do something new with the inventory, something that will not only make you stand out but something that’s more in line with what customers are looking for. Business is a game that requires constant change in strategy if you want to achieve great competitive advantages.
Creating a unique selling point is not as much about investing more money into the enterprise as it is about making better use of the money you are spending. While the resource is a big power, knowledge is a greater power. The more you know the better you can modify your business to meet market trends. To really develop a competitive advantage you need to spend the time to reflect and evaluate what you are doing and how you are doing it.