The traditional approach in business is to regard competitors as enemies. In keeping with that philosophy, when a competitor succeeds, wins a customer, or lands a deal, the result is lost business opportunities for you. However, that old attitude toward competition needs an adjustment if you’re going to adapt to the realities of the modern business world. These tips will shed light on how working with your competitors can actually enhance your business.
If you are competing with another company for the same customer and you’re both offering the exact same goods or services, you’re likely stuck in the dog-eat-dog mentality. In that kind of business culture, it’s difficult to partner with competitors, and success usually means lowering prices. No business owner wants to slash revenue in order to succeed and there are things you can do to avoid getting caught in that kind of uninspired business model.
Rather than offering identical products or services that others already offer, aim for specialization. If you differentiate yourself and find a unique niche, you’ll ultimately improve your business because you’ll have an easier time focusing and striving for improvement. By concentrating on your strengths, you may appeal to a smaller market, but you’ll have that market cornered. And if your would-be competitors adopt the same approach, you can easily refer customers to one another.
Referrals from Competitors Carry Great Weight
Customers will appreciate your candor if you admit that another company might be in a better position to satisfy their needs. That respect will likely lead them back to you when they have needs that align with your specialty. Further, if you can cultivate this kind of synergy with other like-minded individuals, they will return the favor and refer folks to you, as well. And we all know that a referral from a competitor speaks volumes.
Collaboration Breeds Innovation
In a market where cut-throat competition isn’t the norm, business owners are more likely to share information. That sort of collaboration can lead to cost efficient ways of doing business, as well as enhancements in the products and services offered by industry leaders. This can happen on a small scale, for example, as when one business owner learns from a colleague about a more efficient way of handling a particular business practice. But it can also happen on a much larger scale. The anecdotes of how small coalitions of leaders in a given industry have worked together to find ways to deal with the challenges in their line of business could fill volumes of books.
These Partnerships Make Customers Happy
Consumers will obviously benefit when positive intra-industry relationships lead to improvements in the products and services companies offer. And, in turn, these improvements benefit the companies, which invariably find loyal customers through this process. But some businesses have forged alliances that go beyond just enhancing what they’re selling to customers.
For example, some business owners are starting to pair up with similarly situated companies to offer educational sessions and training events on issues related to their businesses. Take two financial planners who co-sponsor an event concerning various aspects of planning for retirement. One business owner could lead a session on one topic (such as the best kind of accounts to open to minimize tax burdens), and the other could discuss a different subject (such as long-term care insurance). Chances are that neither financial planner took business away from the other. Instead, they both gained exposure that they might not have received if they hadn’t worked together and, hopefully, the event will lead to some business for both of them.
If those in your industry are still slaves to a “me-against-them” mentality, it’s time for a revolution. Although that approach to competition may have worked long ago, the realities of our global economy simply make it outdated in today’s world. Armed with these tips, now is the time for you to transcend the old way of doing things and start working together with competitors to build your business.
So, in the interest of putting this whole “let’s work together for the greater good” thing we’ve got going – let’s hear it. Have you ever teamed up with a nemesis? What did you say to her to get her on board? What are some of the ways you have reached out that, in hindsight, may not have been the best approach?
- Erin Schwartz is a regular contributor to the site www.123Print.com. The website offers customizable print products for business and individuals. You can get everything required to market a business, including the ability to make your own business cards and design other promotional items.