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Small business retail advice: how to take on a local competition


This article is another in our series of small business retail management advice. It comes from a deep well of experience helping small business retailers, local retailers, as well as our own experience running successful retail businesses.

How to take on a local competitor with care and respect.

If you want to grow your retail business it is likely that at some point in time you will need to take on a local competitor. By take on, we mean compete with, head-on, in a category or on a whole of store basis.

While it can sound cold-hearted suggesting you take on a local business colleague, it is survival of the fittest in the world and, especially, in business. Better you than them.

The time you might consider taking on a competitor could be when you are looking at taking on a new product category, something sold in another business nearby. Such a move could likely be seen as an attack on the other business – hence the need for careful planning and management … BEFORE you make the move.

Here is advice on how to approach taking on a local competitor.

  1. Ensure there is a need in your business or the community for you to move against a local competitor. The need could be in your business – the need for more traffic and / or revenue. The need could be in the community for better products because the competitor is doing a bad job or overcharges. Ensure you know what the need is and that it is enough to fuel your commitment for what is ahead.
  2. Make sure that the new product category fits with your business and how you and your customers see your business.
    1. The move must make sense in terms of what you sell and what you are known for.
    2. The move must have a story backing it for you and your customers to believe in the move.
  1. Thoroughly assess risks you and others working with you see.
    1. How the competitor and / or community might react publicly.
    2. How the competitor and / or community might react privately.
    3. What the competitor might invest to fight.
    4. Whether they can take on what you plan to stock and directly compete.
    5. How people might perceive you taking on a local business.
    6. To you and your health – competing takes stamina.
    7. Do you have sufficient resources for a long-term plan?
    8. What if the competitor closes? Are you ready to deal with that?
  2. What will be your Unique Selling Proposition, what will separate your offer apart from the competitor(s)?
    1. You must have a genuinely unique proposition: range (deep into a niche for example), quality, brands, price, customer service or a combination of these.
    2. The differentiating proposition must be obvious and valuable to local shoppers for it is this that will justify you taking on a competitor.
  1. DO IT BETTER. On all fronts. This is the most important factor of taking on a business.
    1. You must do it better, from the outset.
    2. Better products, better brands, better displays, better service, better marketing. Price does not have to be a factor if you are better in all other areas.

Taking on a competitor by introducing new products or product categories in your business can be tough anywhere. The goal of our advice is to have you plan for the move for good planning is a key factor in success.

We often see businesses take on a competitor without thought and eventually retreat having lost money. Avoid retreating by taking time to research and plan.

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By Mark