One important step before you start a business is doing business analysis / competition analysis. You should review the literature from competitors, to see how they represent their business and what kind of public image is built. The business literatures often include mission statement and also identify their specific products and services. James W. Hart, a marketing expert, offers tips competition analysis that includes the following steps:
1. Be as customers with enough money. Call competitors in your area and speak with a representative from the company as you are the potential prospects who are looking for information. You can inquire with the formula 5WH (Who, What, When, Where, Why and How) to provide intelligent questions and get answers about the strengths and weaknesses of your competitors.
One of the most important things that must be successful you have to do is make them send their sales & information package to you, where the package will be explained about their products and services.
Your competitors’ business literature will tell you in detail about their public image, and besides that you can learn the strengths and weaknesses of products and services they offer in detail. Make sure you also learn how they handle calls from customers, processing information requests, and how long the inquiry would eventually get to your hand.
Can you offer better communication systems? How does the appearance of their business cards? Small things like this can give an idea about your own strengths and weaknesses, so it can be determined whether you can compete with them or not. Are you going to compete on price or service better?
2. Call your competitors outside your area. Then, you can call the company that is similar to your business (or who are your plans) outside your area, where you will not be considered as their rivals.
Thus, they do not feel threatened when you give a question. It is useful if you can speak with key personnel from similar companies, for example in other provinces. When you talk to competitors that far away, your approach should be more “straight-forward.”
You can tell the owner or manager who you’re thinking of opening a similar business and expect to enter / input from them. Often times they will be happy to provide input about their industry, business as whole and more free information on you.
However, you need to be careful not to spend too much time in question, limit your telephone conversations 10 to 15 minutes maximum. The best way is to think about these questions beforehand, and write it down on paper, so you can ask smoothly.
Thus you will look like a professional, and if one day you need to call again, they will accept it. If you sound like a fool when talking on the telephone, they may not receive your call again. The key is not wasting time.
3. Finally you can do “in-field competition analysis” by doing telemarketing on the prospect and ask if they know your competitors, never do business with them, and others. By doing this, you also do the prequalification of potential prospects who never do business with your competitors, and open opportunities for sales.
Additionally, when you are doing sales calls in outdoor, you can perform the same way when talking with prospects and you can find out what they liked and what they do not like from your competitors. Once again, you can open opportunities for sales by identifying points of differentiation you against competitors.
By doing the steps about Competition Analysis of Business and hone your phone-skills, you will certainly get a lot of useful information about the business you’re considering.