It’s been said that a little competition is good for the soul. In business, this is especially true. Where would Coke and Pepsi be without each other? Or McDonald’s versus every other fast-food restaurant?
A little competition is healthy. You probably already know this if you’re an athlete or participate in young entrepreneurship competitions. It pushes you to do better, think more creatively, work harder, and persevere.
Let’s take a closer look.
HEALTHY COMPETITION FORCES YOU TO CHALLENGE YOURSELF
If you’re the only babysitter in the neighborhood, how will you know whether you’re succeeding at it? There are zero other babysitters around, giving parents no choice but to hire you. So how do you know you’re running a successful business if you’re, quite literally, the only game in town? Lack of competition can make you complacent. And complacency is not how young entrepreneurs become strong leaders.
When another babysitter enters the game, you’re now forced to make some decisions:
- Will you change your rates?
- Will you adjust your marketing plan, or have to create one from scratch?
- What new or better services will you offer that keeps you ahead of the competition?
- How will you improve the quality of your services?
- How will you keep existing customers and gain new ones?
HEALTHY COMPETITION KEEPS YOUR COMPANY RELEVANT
When you have businesses in the same field as yours, that means there’s demand for this product or service. Which is great news!
Look again at the existing competition. What are they missing? What can you offer that’s different, better, or cheaper?
Competition will help you maintain relevancy in what may be a saturated market.
At the same time, looking at the existing market may show you that there’s not a lot of demand for what you’re selling. Why go through the trouble of creating a widget if no one wants one? This is where you take a step back and check your business plan. Ask yourself:
- Are you solving a problem?
- Are you making life better?
- Are you making people happier?
If the answer to any of these questions is “no,” then your company may not be relevant enough to compete. What will you do about it?
HEALTHY COMPETITION PAVES THE WAY
When others have done what you’re doing, that gives you a major advantage. You can look at what they’ve done wrong, what they’ve done right, and adjust your business plan accordingly.
Look at these famous marketing mistakes. While they were unfortunate for the major brands that made them, they’re good news for competitors. As a startup, you can learn from this list and avoid repeating these costly errors.
HEALTHY COMPETITION KEEPS YOU SHARP
This is something athletes know and businesses pay good money to keep track of. What’s your competition doing?
Without resorting to corporate espionage (which shouldn’t be in a young entrepreneur’s playbook anyway), staying on top of your competitors will keep you sharp. Going back to the world of fast-food competition, we know that Burger King started selling a meatless burger option first, back in August of 2019. But once other chains started offering their own versions, the Impossible Whopper no longer dominated the market. Keep track of what your competition is doing. Then go a step further.
HEALTHY COMPETITION CAN GIVE THE LITTLE GUY (LIKE YOU) A MARKETING ADVANTAGE
Amazon is great and all, but not everyone feels comfortable contributing to a behemoth like that. Many customers want to support their small, local businesses. Hint: that’s you.
Take advantage of the fact that you are independent, young, and starting out. Let people know that by going with you instead of a big brand name, they are doing good in their community. People love to feel like they’re making a real difference in the world. They want to go beyond online donations, yard signs, or “slacktivism.” Most people want to see their support work in real-time. Let your customers know that when they buy your product or hire your service, they’re not putting more money into the pockets of billionaires who don’t need it. Instead, they’re helping a young entrepreneur – their neighbor – go to college.
TIPS FOR STAYING COMPETITIVE
1. Find your niche. Remember the beginning of this article when we talked about a new babysitter entering the market in your neighborhood? Maybe this is a sign that you should narrow your focus to a more specific type of client. Can you offer tutoring? Are you trained in CPR and first aid? Do you have a way with infants and toddlers?
2. Offer the very best customer service. Be quicker to address complaints. Be nicer. Be more accommodating. Offer more incentives. Give customers more of what they want than your competition can do.
3. Be prepared for emergencies.
4. Stay flexible. When the pandemic hit, businesses that survived were those that could easily pivot to the “new normal.”
5. Make friends with your competition. Yes, really. Let’s say you run a lawn mowing business in town. Now, let’s say some of your clients live far away. Why not partner up with another lawn mower who can handle those clients while you handle their clients closer to you? Everybody wins!
WHEN COMPETITION IS NOT HEALTHY
Of course, there are times when competition can become unhealthy. Some signs of unhealthy competition include:
- Loss of friendships or other close relationships
- You can’t stand the thought of “losing” to the point where it affects your health
- You feel like a failure and want to give up
- Your desperation overrides your better judgment
- It’s not fun anymore
- Your only goal is to see others lose
If you start to notice any of these happening to you, stop, breathe, and take a break. Ask friends and family if they’ve noticed anything different about you. Take an honest inventory of yourself and check how you feel. Are you losing sleep? Not eating? Giving up other activities that normally bring you joy?
When this happens, it’s time to reconsider whether competition is helping or hurting. The former is good for you. The latter means it might be time to move on to something else.
Florida’s young entrepreneurs are encouraged to apply for a Kantner Foundation college scholarship. Learn more by clicking here!