Identifying Competitors and How to Respond

Competition exists in almost all kind of businesses; it has importance in all fields whether manufacturing, service or trading you always have to work under competitive pressure to draw out the good results. The sole aim of all is to predict the different opportunities and threads in order to enhance the strength of any entity and to remove the weakness prevail in the enterprise, Hence an enterprise always aims to increase the profitability of an organization by utilizing the powers of internal assessments the part of which is the competitor’s analysis.

There are different useful methods to assess the efficient and deficient areas of competitor’s territory.

In order to deal with competitors the company has to perform usually four steps.

1. Identification of the competitors.
2. Ascertain the characteristics of competitors such as:
3. Strategies.
4. Objectives.
5. Strength and weakness.
6. Reaction pattern.

Several points must be taken into consideration while making a wise assessment to beat the competitions.

Identification:

1. The first step should be to recognize the matrices of all relevant competitors in the market so you can make an accurate design and study material for managing the whole process of analysis.
2. You can easily examine competitors by considering various levels such as_ brand, industry, form, generic or by looking at the competition from an industry and a marketing point of view.

Strategies:

1. Identification of the successful products and services, are provided by the competitors to customers.
2. Determine the pricing strategies and terms of different offerings to both industrial and individual customers.
3. The terms and conditions on what the competitors are negotiating with suppliers and distributors.
4. Take a look on current and potential channels of distribution are being utilized by the competitors.
5. Make an assessment on the profitable marketing tools such as_ direct marketing, sales promotions, advertising and personal selling.

Objectives:

1. 1. The company has to take a look on the matter that what is the each competitor seeking in the market place and what drives each competitor behavior.
   2. Different competitors presume some mix of objectives: current profitability, market share growth, cash flow, technological leadership, service leadership, Knowing how a competitor weigh each objective, that will help the company in anticipating its reaction.

Strength and weakness:

1. Analysis of techniques, methods, processes and procedures are employed by the competitors for the satisfaction and attraction of existing and potential customers.
2. Scrutinize the competitor’s advantages that provide the basis for survival in both high growth industry and nitty-gritty world of business.
3. Look at the number of shares that are held and acquired by competitors.
4. Examine the level of loyalty of existing customers towards competitor’s offering_ products and services.
5. Try to make the most of competitors’ weakness while keeping on the track of their strengths.
6. The possible grounds on what the competitors are considered as superior or inferior to other competitors of the industry.
7. Bench marked the competitors against the world class organization to highlight their position in the metrics companies which are expected to procure more profit or loss in the future.

Reaction pattern:

1. Each competitor has a certain philosophy of doing business, a certain internal culture and certain guiding beliefs.
2. Most of the competitors fall into one of four categories.

• The laid-back competitors.
• The selective competitors.
• The tiger competitors.
• The stochastic

c. The company should consider its competitors’ reaction pattern so that right decision can be taken at the right place in the right time.

This entry was posted on Wednesday, June 17th, 2009 at 4:37 pm and is filed under International Trade. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.