Competition Comes in Many Forms
Your competitive universe includes more than just your direct competitors. Customers, suppliers, and potential new competitors (outside your industry) also affect your strategic position and competitive stance. Don’t restrict your thinking and planning to only dodging and countering new moves by your direct competitors.
Staying and succeeding in business these days not only means dealing with change but keeping a watch on every aspect of your business. Plan for situations like:
- What would happen if your best customer went out of business?
- What if a major supplier raised prices by 50%?
- What could you do (or exploit) if new approaches emerged to solve your customer’s problems?
Customers may also decide they have better things to do with their money than buy your products. For example, Nestle complains that the rivals for its candy, ice cream and beverages are no longer only Mars or Pepsi, but telecom and gaming companies. According to their chairman, five years ago, seventy percent of kids’ pocket money went to buy chocolates and ice cream; now eighty percent goes for cool smart phones and music downloads.
So, remember to expect and deal with inevitable change, but also broaden your perspective and keep watch on every aspect of your competitive environment. With the low barrier to entry that the Internet brings, watching for and aggressively addressing your business’ not so obvious competitive threats is more important than ever.