Define your competition in your business plan

Dear readers

In my last blog post on writing your marketing plan with the help of Business Plan Pro (business plan software), we discussed your strategy behind your market segmentation. Now, after you have defined your market segment strategy, you need to pay attention to your competition you are facing in your specific industry.

In short, you need to analyze your specific industry and the competition. Discuss the following:

1. Type of industry you are operating in. For example: Business Around The Globe.Com operates in the e-commerce field, but more specifically in e-publishing (e.g. quality e-books, cartoons and software). Even more specifically, we deliver business e-publications.
2. You also need to discuss the size of your industry, size of your competitors and the “density” of the industry – or rather the concentration of your competitors. Furthermore, how do you (or rather your business) fit into the picture? Is there room for you to do business or is it a cut-throat environment?
3. How do businesses in this industry operate on a day-to-day basis – i.e. discuss specifics like product and service delivery (from buying to selling).
4. One important aspect is the behavior of customers – especially how they choose between the different competitors’ products or services. What is the most important aspect in the eyes of the customers? There are a few factors that can “persuade” customers to buy:

• The brand name of the business
• Word of mouth
• Price of product or service
• The features of the product or service
• Quality of product or service
• Reputation and image of the business delivering the products or services
• Visibility of the business in the market via different channels of advertising and marketing mediums
• Etc. etc.

In the end you should be able to tell potential investors exactly how your business stands a chance to compete with the current competitors and how you will earn the trust and loyalty of customers and, most importantly, persuade them to buy from you!

Every industry is different and it does happen that you get bright spark entrepreneurs that can even make their businesses stand out in their relevant industries – different from the other in the specific industry.

If you have any questions, you are welcome to contact us.

Warm regards

Michiel Jonker, CISA

Tags: Business Plan, Business Plan Software, competition, marketing, marketing plan