WHEN ENTREPRENEURS talk about their competitors, the talk is usually disparaging rather than admiring. The competitor gives bad service, they cheat, they only get business because of bribes or political connections, they deliver inferior products and do not pay taxes to reduce their prices. We seldom hear that their technology is great, their service levels enviable and their legendary efficiency allows them to sell at great prices. Yet many competitors must be as good or better than you; they are making sales while competing with you.
We want to see ourselves as better than our competitors, so we focus on their faults. Instead, rather develop your own value proposition, one that really does offer something special and preferably unique to the market. Then see how your value proposition stacks up against theirs. Doing this can be a sobering experience, you may find that you are not the greatest after all. You then have the opportunity of improving your products, customer service, pricing, communications and customer relations to become competitive.
So far, I have talked about traditional competitors selling similar products and solutions to yours. Prof. Michael Porter produced a neat model, the Five Forces of Competitive Position, showing that aside from traditional competitors there were competitive forces in the power of buyers, the power of suppliers, the threat of new entrants and the threat of substitute