Writing a Business Plan: Competitor Analysis Section

 

competitive analysis business plan example

Aug 13,  · Business plans should incorporate a section addressing the competitive analysis. Business Plan Pro by Palo Alto Software is one example of how the competitive analysis is integrated into the plan. This information and perspective is then used to build a more comprehensive competitive business strategy. Originally published on boittierssa.tk(4). The Medical Group medical services management business plan competitive analysis. The Medical Group is a start-up company providing a physician network of . Dec 13,  · A good competitive analysis varies according to what industry you’re in and your specific Web plan and situation. A competitive analysis does have some common themes. Begin by explaining the general nature of competition in your type of business, and how customers seem to choose one provider over another.2/5(2).


Competitive Analysis Examples and How-To Guide | Mplans - Mplans


The Competitive Analysis section of your business competitive analysis business plan example is devoted to analyzing your competition--both your current competition and potential competitors who might enter your market.

Every business has competition, competitive analysis business plan example. Understanding the strengths and weaknesses of your competition--or potential competition--is critical to making competitive analysis business plan example your business survives and grows. While you don't need to hire a private detective, you do need to thoroughly assess your competition on a regular basis even if you only plan to run a small business.

In fact, small businesses can be especially vulnerable to competition, especially when new companies enter a marketplace. Competitive analysis can be incredibly complicated and time-consuming Here is a simple process you can follow to identify, analyze, and determine the strengths and weaknesses of your competition.

First develop a basic profile of each of your current competitors. For example, if you plan to open an office supply store you may have three competing stores in your market, competitive analysis business plan example.

Online retailers will also provide competition, competitive analysis business plan example, but thoroughly analyzing those companies will be less valuable unless you also decide you want to sell office supplies online. Although it's also possible that they--or, say, competitive analysis business plan example, Amazon--are your real competition.

Only you can determine that. To make competitive analysis business plan example process easier, stick to analyzing companies you will directly compete with.

If you plan to set up an accounting firm, you will compete with other accounting firms in your area. If you plan to open a clothing store, you will compete with other clothing retailers in your area, competitive analysis business plan example. Again, if you run a clothing store you also compete with online retailers, but there is relatively little you can do about that type of competition other than to work hard to compete in other ways: great service, friendly salespeople, convenient hours, truly understanding your customers, etc.

Once you identify your main competitors, answer these questions about each one. And be objective. It's easy to identify weaknesses in your competition, but less easy and a lot less fun to recognize where they may be able to outperform you:. While these questions may seem like a lot of work to answer, in reality the process should be fairly easy.

You should already have a feel for the competition's strengths and weaknesses Keep in mind competitive analysis does more than help you understand your competition. Competitive analysis can also help you identify changes you should make to your business strategies.

Learn from competitor strengths, take advantage of competitor's weaknesses, and apply the same analysis to your own business plan. It can be tough to predict when and where new competitors may pop up. For starters, regularly search for news on your industry, your products, your services, and your target market.

But there are other ways to predict when competition may follow you into a market. Other people may see the same opportunity you see. Think about your business and your industry, competitive analysis business plan example, competitive analysis business plan example if the following conditions exist, you may face competition does the road:. In general terms, if serving your market seems easy you can safely assume competitors will enter your market. A good business plan anticipates and accounts for new competitors.

The Competitive Analysis section for our cycling rental business could start something like this:. Our nearest and only competition is the bike shops in Harrisonburg, VA. Our next closest competitor is located over miles away. The in-town bike shops will be strong competitors.

They are established businesses with excellent reputations. On the other hand, competitive analysis business plan example, they offer inferior-quality equipment and their location is significantly less convenient. We do not plan to sell bicycles for at least the first two years of operation. However, sellers of new equipment do indirectly compete with our business since a customer who buys equipment no longer needs to rent equipment.

Later, when we add new equipment sales to our operation, we will face competition from online retailers. We will compete with new equipment retailers through personalized service and targeted marketing to our existing customer base, especially through online initiatives. While your business plan is primarily intended to convince you that your business makes sense, keep in mind most investors look closely at your competitive analysis.

A common mistake made by entrepreneurs is assuming they will simply "do it better" than any competition. Experienced businesspeople know you will face stiff competition: showing you understand your competition, understand your strengths and weaknesses relative to that competition, and that you understand you will have to adapt and change based on that competition, is critical.

And, even if you do not ever plan to seek financing or bring in investors, competitive analysis business plan example, you absolutely must know your competition. Next time we'll look at another major component in a business plan: how you will set up your Operations.

What are their strengths? Price, competitive analysis business plan example, service, convenience, extensive inventory are all areas where you may be vulnerable. What are their weaknesses?

Competitive analysis business plan example are opportunities you should competitive analysis business plan example to take advantage of. What are their basic objectives?

Do they seek to gain market share? Competitive analysis business plan example they attempt to capture premium clients? See your industry through their eyes. What are they trying to achieve? What marketing strategies do they use? Look at their advertising, public relations, etc.

How can you take market share away from their business? How will they respond when you enter the market? Check out their websites and marketing materials. Most of the information you need about products, services, prices, and company objectives should be readily available.

If that information is not available, you may have identified a weakness. Visit their locations. Take a look around. Check out sales materials and promotional literature. Have friends stop in or call to ask for information. Evaluate their marketing and advertising campaigns. How a company advertises creates a great opportunity to uncover the objectives competitive analysis business plan example strategies of that business.

Advertising should help you quickly determine how a company positions itself, who it markets to, and what strategies it employs to reach potential customers.

Search the Internet for news, public relations, and other mentions of your competition. Search blogs and Twitter feeds as well as review and recommendation sites.

While most of the information you find will be anecdotal and based on the opinion of just a few people, you may at least get a sense of how some consumers perceive your competition.

Plus you may also get advance warning about expansion plans, new markets they intend to enter, or changes in management. You might be surprised by what you can learn about your business by evaluating other businesses. The industry enjoys relatively high profit margins Entering the market is relatively easy and inexpensive The market competitive analysis business plan example growing--the more rapidly it is growing the greater the risk of competition Supply and demand is off--supply is low and demand is high Very little competition exists, so there is plenty of "room" for others to enter the market.

Now distill what you've learned by answering these questions in your business plan:. Who are my current competitors? What is their market share? How successful are they? What market do current competitors target? Do they focus on a specific customer type, on serving the mass market, or on a particular niche? Are competing businesses growing or scaling back their operations? What does that mean for your business? How will your company be different from the competition?

What competitor weaknesses can you exploit? What competitor strengths will you need to overcome to be successful? What will you do if competitors drop out of the marketplace? What will you do to take advantage of the opportunity? What will you do if new competitors enter the marketplace?

How will you react to and overcome new challenges? By offering mid- to high-end quality equipment, we provide customers the opportunity to "try out" bikes they may wish to purchase at a later date, providing additional incentive besides cost savings to use our service.

Offering drive-up, express rental return services will be seen as a much more attractive option compared to the hassle of renting bikes in Harrisonburg and transporting them to intended take-off points for rides. Online initiatives like online renewals and online reservations enhances customer convenience and positions us as a cutting-edge supplier in a market largely populated, especially in the cycling segment, by customers who tend to be early technology adapters.

Renting bikes and cycling equipment may be perceived by some of our target market as a commodity transaction. If we do not differentiate ourselves in terms of quality, convenience, and service, we could face additional competition from other entrants to the market. One of the bike shops in Harrisonburg is a subsidiary of a larger corporation with significant financial assets. If we, as hoped, carve out a significant market share, the corporation may use those assets to increase service, improve equipment quality, or cut prices.

The Competitive Analysis section helps you answer the "Against who? Like this column?

 

A Competitive Analysis Example to Give You a Running Start

 

competitive analysis business plan example

 

The Medical Group medical services management business plan competitive analysis. The Medical Group is a start-up company providing a physician network of . Aug 13,  · Business plans should incorporate a section addressing the competitive analysis. Business Plan Pro by Palo Alto Software is one example of how the competitive analysis is integrated into the plan. This information and perspective is then used to build a more comprehensive competitive business strategy. Originally published on boittierssa.tk(4). Jun 28,  · For the competition section of your business plan, first settle on which of these two business uses applies to your situation: Internal management plan: In the management plan for business owners, a competition section serves as a vehicle for understanding competition and developing strategic positioning. You and your team look at comparative /5(3).