Owning and operating a small business comes with unexpected events. Your company might be one of the few ones to sell a specific product or service in your area. When new competition opens up near you, what should you do?
You might think this can be a disadvantage. Maybe you think that your company will lose money. Competition brings quite the opposite effect on a business, and will most likely create success if your business is already operating well.
Evaluate Your Business
If the new business is opening up soon, take it as a wake-up call. Make sure you are satisfying your customers and their needs. If your business is doing a good job, your competition will not matter as much.
Once the other business is open, find a new advantage that your business has over them. Take notes on their pricing, promotions, and other benchmarks. See if your business can make any changes to increase sales.
Stay cordial and friendly with the owners of the new business. When speaking to your customers, keep a positive tone about your competition even if you do not feel that way. Bashing others will never lift your business up. Customers want to purchase from a business that stays professional when the unexpected happens.
Grow Your Customer Base
Besides looking after your current customer base, you should be looking for new customers. Consider how you are marketing your business. Is it time to try something new? Place an advertisement in a different place or have a promotion on a product or service that has not been done before. Remember to use any forms of free advertising that you can like social media and encouraging word-of-mouth.
Appearance is important for businesses, including the brick and mortar location and online presence. This affects customer’s perceptions of your business. Your competitor will most likely be freshly decorated or revamped from an old building. Take the time to do a deep clean of the premises, update some old decor, or touch up with a fresh coat of paint. Update your social media bios and add up-to-date information to your website. Maybe it is time to re-do your branding and logo design as well.
If your business does not already utilize a loyalty program, you should consider doing so. Reward programs create an incentive for customers to return back to your business. Your loyalty program can be a simple stamp card if the business has a small budget, or you can find a digital program to keep track of the customer’s loyalty points. Once the customer’s point goals are met, you can offer them a discount or a free product/service to show your appreciation to them.
Although it can be difficult when another business first opens up, there are many actions you can take to keep your business going strong. It is also important to stay realistic in your expectations. It is uncertain what may happen, especially if the competitor is a large corporation with a massive marketing budget. Take action as soon as possible.
PL Consulting can help you with business planning, budgeting, and other bookkeeping services. We are here as your business’s go-to resource when you have questions. We customize our services to each of our clients and their business plans.