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How Does Your Business Stack Up to your Competition?

Guest post by: Gary Silverman

Article Overview: Recently we have been hearing more and more about business failures like Circuit City and Linens and Things. These “Big Box” retailers showed tremendous growth over the past years. The concept rolled into town in earnest over a decade ago and was instantly embraced by consumers. Their creation facilitated the birth of the “Power Center” and wreaked havoc on locally owned small businesses. Wall Street applauded the growth curve of these concepts and rewarded the stock price with each announcement of new store openings. Once they hit maturation, the same store sales “boogey man” kicked in.

How Does Your Business Stack Up to your Competition?

New stores diluted the customers of the existing stores leading to over-saturation. The Big Boxers are currently suffering. Look at Home Depot, and Lowes for example. I still believe the concept is viable and sustainable. Going forward the emphasis will be on store closures and remodels like Wal-Mart’s recent initiatives. Small business owners can learn from these miscues. I recently went into a Circuit City store and I was more than disappointed. The store was disorganized, short of staff, dimly lit, and had a poor selection of merchandise. The sad thing was that this store was only two years old and located outside a very successful mall. I proceeded to visit Best Buy and found the experience to be far better. I had a similar experience when I compared Linens and Things to Bed, Bath, and Beyond. My experience at Linens and Things was inferior compared to BB&B. Did the top management of Linens or Circuit ever visit their stores or those of their competition? If they did wouldn’t it be obvious to them that their stores were inferior to those of their competitors? Obviously not. As top management or owners we should be intimately familiar with our own businesses and how they compare to the marketplace. Do you have blinders on when it comes to this reality? Are you staying current? In a world of continuous improvement and rapidly changing tastes and technology you need to stay on the cutting edge. It’s a double edged sword. If you aren’t adapting fast enough ...that’s one problem. If your competition is, you have a compounded problem. Take the time to research the changing tastes and demands of your customer. It is equally important to be aware of how your competitors are changing. Don’t be left behind as your revenues and profits will decline and it will be difficult to make the financial investment necessary to catch up. You need to have a discipline of regularly shopping your business and those of your competitors. There needs to be a process to survey your good customers to see if they sense any decline in your service or pricing competitiveness. They are the first to see it. You need to personally visit your competition to “take their temperature”. Be aware of any new entries in your market or perhaps businesses outside your market who may decide to branch out into your territory. Look through the windshield as well as the rear view mirror and protect what you have so you don’t disappoint like the Circuit City’s of the world.

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Article Tags: bed bath, best buy, boxers, circuit city, circuit city store, continuous improvement, double edged sword, financial investment, home depot, left behind, linens and things, lowes, miscues, poor selection, sad thing, saturation, small business owners, tastes, top management, wal mart



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