Where Do You Stand Among the Competition: 4 Questions to Help You Find Out

As an entrepreneur, you likely spend much of your time focused on your business. Yet as you prepare to launch (or grow) your company, it’s just as important to expand that focus to your competitors. Knowing and understanding your competitors is a key part of any company’s success. After all, odds are you’re not bringing a brand-new product or service to the market. That means you have competitors – and you need to show potential customers why they should do business with you, despite other choices in the market.

To help you get started, we’ve created a list of four questions you should answer about your competitors and your business.

1. WHO ARE MY COMPETITORS?

Before you delve into what your competitors are doing, you need to know who they are. Our recommendation: start with a competitive analysis.

By completing a competitive analysis, you’ll not only identify your top competitors; you’ll also examine what they offer, their message and how they’re connecting with their customers.

Then, you can use that information to refine your message, marketing, even your launch strategy, so that you can stand out from the rest of the pack.

Here are a few things to include in your competitive analysis:

1. A list of your top 10 competitors (including company demographics, size and location)
2. What products or services do they sell?
3. A one-sentence summary of their value prop or message (Note: If you can’t easily figure this out from their website and social channels, that’s important to note—and another opportunity for you to stand out).
4. Each competitor’s market share
5. Each competitor’s retail presence — online-only? Brick and mortar? Omnichannel?
6. Their social media channels
7. Their content, including but not limited to blogs, e-newsletters, whitepapers, direct mail, etc.
8. Each competitor’s strengths and weaknesses
9. Possible threats to your business?

You should be able to get a lot of this information just by exploring a company’s website, visiting their store (if feasible/applicable) and taking a look at their social media presence.

For help building your initial list of competitors, use company directory databases like Dun & Bradstreet or ReferenceUSA, which should be available at most public libraries.

And while you’re in research mode, it’s also a good idea to do a market analysis. This is an examination of your industry so that you can take notes of trends, whether the industry is expanding or diminishing and possible disruptors.

A great starting place for industry information is a trade organization and that organization’s publications and magazines, if they have them. You can also use the Encyclopedia of Associations (available at your local library) to help point you in the right direction.

2. WHY YOUR BUSINESS OR PRODUCT?

Now that you have a solid understanding of who your competitors are and what they offer, it’s time to look at your own business. Consider these questions:

1. What makes your product or service different from your competitors?
2. Why should a customer choose your product or service instead of a competitor?
3. What opportunities exist for you to innovate and stay ahead of the competition?

This way, you’re building on the foundation created by your competitive analysis. You not only know who your competitors are and what they’re doing, but also how you stand out. And it’s this information that will drive your messaging and marketing so that customers know who you are, what you offer and how you can help them.

3. WHAT’S YOUR VALUE PROP/MESSAGE?

Take the information you compiled in the last section — namely, what makes your product or service different from your competitors and why a customer should choose you — and solidify your company’s value prop and message.

As you articulate your value proposition, it will likely be similar to — or at least inspired by — your personal vision. After all, there’s a reason you want to start a business. There’s a reason you want to offer a particular good or service. Use that motivation to help tell customers what makes you a different — and better — choice when compared to competitors.

Conducting a competitive analysis before you create your company messaging can also help you craft a more impactful, results-driven message. Think back to the competitive research you did and which competitors stood out. Did you connect to any of the companies on a more emotional level? Did one do a better job than the others of telling you how they’re going to solve a problem?

There’s no harm in gleaning inspiration from your competitor analysis. You do, of course, want to avoid any sort of plagiarism. Instead, think of your customers and put yourself in their shoes. What do they want to know? What sort of message will inspire them to act? And how will your product or service help make their lives better?

4. HOW/WHERE CAN YOU SHARE THAT MESSAGE?

Once you’ve crafted your company’s messaging, think about how, where and to whom you can share that message.

Again, take a cue from your competitive analysis and look at what your competitors are doing. How are their websites? Do they blog? Are they active on social media? What social media channels are they using?

This isn’t necessarily the time to plan your full marketing strategy, but it is an ideal moment in which to start thinking about how you can connect with prospective customers to generate interest pre-launch and help drive sales and awareness once your business is up and running.

Remember: you don’t have to do everything your competitors are doing. And, honestly, you shouldn’t. After all, you’re presenting a better option than what your competitors are currently offering, and you need to share that message accordingly. Look for opportunities to be ahead of the curve, whether with a particular type of content, a new channel or platform, or another way that you can not only reach customers, but also connect with them. Successful businesses are those that help build and nurture relationships, and effectively communicating why you’re a better option is an optimal way to make a lasting — and positive — first impression.

 

TWO EASY WAYS TO KEEP TABS ON COMPETITORS

Once you’ve launched your business, you’ll want to keep tabs on your competitors. After all, they’re going to be modifying and refining their products and services to keep up with consumer demand, changing market conditions and industry trends — and you need to be proactive about doing the same.

It doesn’t hurt to revisit your full competitive analysis on a semi-annual or annual basis. But in the meantime, here are two ways you can stay connected to your competitors.

1. Subscribe to their emails: Pick 2-4 of your strongest competitors and, if they offer an email newsletter, subscribe to it. That way, you’ll get their business updates, product news and other info delivered straight to your inbox.
2. Set up listening streams on social media: Social media is an effective way to build brand awareness, help encourage sales and engage your customers. It’s an equally effective tool when it comes to staying in the loop with your competitors and industry in general.

Use a social media dashboard like Hootsuite to set up listening streams in Twitter. Pick a keyword, a search term or a competitor’s name, then Hootsuite will automatically create a matching Twitter stream. When you manage your company’s social media, take a few minutes and check in on those streams to see what your competitors and their customers are saying. Since social media sites like Twitter offer a real-time flow of conversation, social listening is one of the best ways to stay involved in your market while also spotting opportunities for improvement or differentiation.

If at any point in your competitive analysis or ongoing research you find yourself stuck — or you wonder if you’ve successfully identified your best competitive advantage — help is just a few clicks away.

Sign up for Kauffman FastTrac, free online courses designed to help both aspiring and established entrepreneurs. While you learn at your own pace, you’ll get information, exercises and tips to help you think through your business idea and position your company for lasting success. Talk about a way to stay ahead of your competition!

What Entrepreneurial Strengths Do I Have?

Anyone can start a business (yes, really).

But there’s no denying that some entrepreneurs have skills and strengths that help them achieve success.

As you pursue a path to becoming an entrepreneur, you’ll likely focus most of your attention on your business: your plan, your strategy and what you need to launch.

Yet it’s just as important to take some time and reflect on yourself, too. What strengths do you bring to the table as a business owner? And what are your weaknesses?

As you start thinking about your applicable skills and entrepreneurial strengths, let’s take a closer look at the importance of evaluating both your strengths and your weaknesses.

KNOW YOUR STRENGTHS

Starting a business is challenging. That’s why it helps to know going in what personal strengths you have that can help you be successful.

Maybe you’re a person who embraces challenges not as obstacles, but as opportunities. Perhaps you’re highly motivated and/or goal-oriented. Do you excel at meeting deadlines? What about your work style: do you prefer to operate at the 50,000-foot level, or do you thrive in the midst of details? Are you creative? A people-person? Competitive or disciplined (or both)?

Try this: think of your work history, your professional achievements and your new business. Then list your top 3 entrepreneurial strengths.

Once you’ve identified three of your biggest strengths, start to think about how those particular skills or strengths will help you launch and sustain your business. When you write a business plan, for example, you’re essentially creating a road map that will help guide you to your ultimate goal.

Identifying and embracing your entrepreneurial strengths can also help with that journey. It’s not uncommon to use a variety of tools and resources to help you get your business off the ground, and you can think of your entrepreneurial strengths as yet another resource to help your business go from dream to reality.

Consider a couple of examples. If you’re a people-person and love networking, tap into that skill to spread the word about your business and make valuable connections that can help you fill gaps or offer insight or feedback.

Is creativity among your strong suits? Not only can you use your creativity to help with key business elements like your personal vision, but it will also likely come in handy when you need to find solutions, whether to unexpected obstacles or the product or service you’re bringing to the market. How will you and your business stand out from the crowd?

It’s important to know, embrace and cultivate your strengths. And for both aspiring and established entrepreneurs, it can be just as vital to know your weaknesses.

RESPECT YOUR LIMITS

When you think about how to become an entrepreneur, juggling might be the first thing that comes to mind.

That’s because entrepreneurs have to wear a lot of hats, at least until the funding is there to build an employee base or outsource particular tasks and roles.

As an entrepreneur, be ready to multi-task. But at the same time, it’s so important to understand this key lesson:

“You can’t be good at everything.”

You may be nodding your head, or you might be cringing. That statement is no knock on your professional skills. Instead, it’s the truth. And by understanding your weaknesses, you’ll know what sort of help you need so that you don’t inadvertently constrain your business and instead set yourself up for long-lasting success.

Earlier, you identified three of your biggest professional strengths or skills. Now, let’s do the opposite. What are your weaknesses or things about running a business that you dislike?

Maybe you have trouble meeting deadlines. Or you’re befuddled by numbers and accounting. Do you shy away from managing others? Does the thought of writing anything about your business—a website, marketing content, etc.—make you want to run screaming in the opposite direction?

It’s not always easy to admit what you’re not good at, but think of it as yet another strength. Because you can’t be good at everything, it’s important to focus on the areas in which you excel. Then, view your weaknesses as opportunities: gaps you need to fill to unleash your full entrepreneurial potential.

This is typically where other professional services come in, including accountants, lawyers and marketers. If, for example, you’re not good with the business side of running a business, that doesn’t mean you’re doomed to failure. Instead, it simply means you need help—and there’s nothing wrong with that.

“IT GAVE ME THE CONFIDENCE…TO LAUNCH MY BUSINESS”

Speaking of help, here’s an idea. Are you struggling with isolating your entrepreneurial strengths and weaknesses? Or have you identified a particular area of need?

That’s where Kauffman FastTrac can help. The free, online business courses walk you through the process of starting a business while also giving you ample opportunity to recognize and build on your entrepreneurial strengths.

Or if you’ve spotted a possible weakness, FastTrac’s business courses can help you navigate that challenge.

Tom Paolini, founder of Paolini Garment Company, is an ideal example. He enrolled in FastTrac to help launch his luxury custom menswear company. And along the way, he got the push he needed to take the next step.

“FastTrac built my knowledge and provided a blueprint for business success,” he says. “It gave me the confidence necessary to launch my business idea.”

A lack of confidence is a common obstacle that many entrepreneurs face. And for good reason—it’s scary to go out on your own and start a business! But few things are as rewarding as being an entrepreneur. If you find you need a similar boost to launch your company, consider FastTrac your personal support system. All you need to do is register!

Plan, Prepare, and Project: Determining Startup Costs

Ask an aspiring entrepreneur their biggest obstacle to launching a business and the likely answer: money. 

Not only do you need adequate financing to get your business up and running; you also need to plan to cover expenses, such as payroll and production, until you start making a profit. 

Startup costs can be tricky to calculate because they vary widely depending on your business, industry, location and other factors. Yet by understanding how much money you’ll need to start and maintain your business, you’ll increase your chances of success and longevity. 

If you’ve already written (or started writing) a business plan, you might have already spent time on your startup finances. If not—or if you want to dig a little deeper—let’s take a look at the three P’s that will help you determine your startup costs and what’s next.

PLAN

The critical first step when considering your startup costs is to get an idea of how much money you’ll need to get up and running.

According to U.S. Census data, more than 40 percent of small businesses started for under $5,000. Your business could vary, of course, depending on the specifics of your startup. And that’s why it’s so important to put pen to paper and crunch the numbers.

This isn’t the time to account for every single expense you might encounter. But consider the following four categories to help organize your startup finances.

1. Capital expenses—These are assets that add to your business’s value and are typically viewed as an investment on the part of your business. Examples include office equipment including computers and other technology, machinery and office and/or production space.
2. Operating expenses—These expenses are generated by the day-to-day operation of your business. Think of costs like utilities, insurance, inventory, supplies and salaries. Remember: it’s not only important to calculate the costs you’ll need to cover to start your business, but also to keep it financially solvent until you turn a profit (more on that in the next section).
3. Professional services—It’s unlikely you’ll start and maintain your company without any professional services. This is where you’ll factor in costs for things like legal assistance, accounting fees, website development and hosting, and marketing/advertising/PR.

Lastly? It’s important to also consider your personal financial situation. Will you need to pay yourself right away? Or can you afford to forego salary while you build your business? Understanding your own finances is just as critical to the success of your business as your startup finances.

Some of these numbers may come easy, and some may be harder to determine. Don’t hesitate to reach out to other entrepreneurs for their input on particular expense categories.

You can also use a handy tool like the Wall Street Journal’s startup calculator to better understand what you’ll need to start your business. Once you do that, it’s time to look ahead. 

PROJECT

We talked earlier about the importance of not only understanding what you need to start your business, but also the cost to keep your business running.

Here’s the deal: you probably won’t make a profit right away. If you do, that’s fantastic. But if you don’t, that’s OK, too. By projecting future expenses—and also understanding what profitability looks like for your business and how you’ll get there—you can better plan for your company’s financial future, which is especially important if you opt to pursue funding for a business startup.

Using the expenses you outlined in the previous section, you can project what it will cost to run your business for the next year. As you calculate your financial projections, be sure you’re considering both fixed costs like rent, utilities, salaries and professional services, as well as variable costs such as materials, supplies, labor and customer service.

Be realistic in your planning, it’s hard to know what the future holds – yet it’s important to understand how your startup’s financial future might evolve. This speaks not only to your understanding of your startup finances, but also the larger market.

You may also find it worthwhile to create two types of financial projections: one that’s conservative, and one that’s more aggressive. That way, you’ll have more of a financial baseline, but also a goal to work toward. 

PREPARE

By totaling the expenses you defined and using your financial projections, you should now have a better understanding of what it will cost to start and run your business. Now, you can prepare to meet that financial reality. 

First, review the expenses you’ve calculated. If you find yourself encountering “sticker shock,” take a harder look at your startup expense categories. Is there any way you can realistically cut back without having an adverse effect on the business?  

Here’s one example: office space. Do you need dedicated office space to launch your startup, or could you launch from a home office or somewhere less expensive, like a co-working space, and then grow into something larger? 

That said, you don’t necessarily want to cut corners on professional services or anything that would diminish the quality of your product or service. Keep in mind that it’s always easier to grow, rather than scale back, but you also shouldn’t feel pressured to launch with a lesser version of your vision.  

Once you’re comfortable with the startup costs you’ve calculated, then you can make a plan for how you’ll meet those costs, including getting a small business loan.  

There’s no doubt that funding for business startups has evolved to include a number of alternative sources to traditional funding, such as grants, crowdfunding, venture capital and angel investors. Of course, that makes deciding on the best financing option a little more tricky. This is another ideal time to reach out to other entrepreneurs and small business owners to get their advice. 

Another option? Kauffman FastTrac, an immersive, online curriculum designed to help you navigate your startup’s launch, including financing. The self-paced courses give you tips, tools and resources to help you fully plan and launch your business, including: 

1. Setting realistic financial goals
2. Determining the steps to profitability
3. Identifying potential funding sources

As you work on identifying and calculating both your startup costs and your financial projections, consider also enrolling in Kauffman FastTrac. The courses are free (take that, budget!) but offer invaluable peace of mind when it comes to ensuring you’ve created a comprehensive financial plan and the best path forward to meeting your specific funding needs. 

There’s no doubting that startup finances are tricky. Yet with Kauffman FastTrac, you’re supported by a partner who’s invested in your success. Talk about a dream team! 

Taking the First Steps, Building a Business Plan

You’ve made the decision: you want to start your own business. And that means you’ll need to write a business plan. As you consider the steps to starting a business, you might think that writing a business plan comes first. Not so fast.

The better starting point is your personal vision: what do you want to achieve? Then you can draft your business plan, which will serve as the road map to get you to your ultimate destination.

Here’s the thing: writing a business plan isn’t always easy, and that’s largely because it’s daunting. A business plan is, in essence, the guide for how you’ll create, launch and run your company. That means there’s a wealth of information to consider before you create your business plan—and then you’ve got to get it all on paper!

A business plan includes strategic, high-level information and tactical details. It also includes market research and analysis, as well as financial projections. Sitting down to create and compile that breadth of information is undoubtedly challenging, but it can absolutely be done.

If you’re ready to tackle your business plan, read on for some help through the process, including what to include and tips for success. If you prefer a more structured approach, we can help with that, too. Check out Kauffman FastTrac, a series of self-paced, online courses that help prepare you to launch a business—including writing a business plan.

Whichever path you choose, the most important thing is to simply get started!

WHAT’S IN A BUSINESS PLAN?

Before you dive in to creating a business plan, it’s helpful to get a handle on what’s included so you can do some prep work, including making notes and conducting research.

If you ask 10 entrepreneurs what elements should be included in a business plan, chances are good you’ll get 10 different answers. Business plans can absolutely be customized to better fit your particular business, but there are some common pieces to include:

1. An executive summary, which outlines your business plan
2. A business description, including your vision, mission and team
3. A market strategy, which details how you’ll launch and position your business
4. A competitive analysis
5. What you’ll offer, which could include: Product design and development, services etc.
6. Marketing and advertising
7. Business operations and management
8. Financial analysis and projections

Once you’ve outlined your business plan, then you can begin to fill in each of the sections. Give yourself time to do some research, especially about current and forecasted market conditions, your intended customer base, competitors and costs

As you start drafting your business plan, keep these tips in mind:

1. Save your executive summary for last. Ideally, your executive summary should be a one-page overview not just of your business plan, but also your business. This will be much easier to write once you’ve finished the rest of the document so that you can focus on the highlights.
2. Be thorough yet concise. It might sound like an oxymoron, but you don’t want to create a novel-length business plan. It’s important to provide detail and supporting facts or research where applicable, but you also want someone to be able to read and understand your business plan in a reasonable amount of time.
3. Don’t hesitate to reach out to experts. You may find yourself stumbling on certain sections of your business plan. For example, financial analysis and projections can be downright mind-boggling, especially for an aspiring entrepreneur. If you get stuck, reach out to an expert like an accountant to help ensure you’re including accurate information.
4. Set a schedule. Writing a business plan isn’t easy, which means it’s more likely to fall to the bottom of your to-do list. Combat possible procrastination with a schedule and deadlines so that you can stay focused and on track.

FASTTRAC: YOUR CURE FOR BUSINESS PLAN WRITER’S BLOCK

Of course, even with the best of intentions and the most thorough preparation, you may find yourself struggling to create a polished business plan or struggling with a particular section. The good news? There’s a solution!

Business plans are just one of several topics covered in Kauffman FastTrac, an immersive series of online courses designed for aspiring and established entrepreneurs.

The self-paced modules offer a deeper dive into starting and running a business. You’ll start with foundational elements such as your personal vision, market opportunity, financial goals and branding and marketing—in short, the information you’ll need to draft your business plan.

After Liz Forkin Bohannon decided to pursue her entrepreneurial dream of designing, sourcing and marketing handcrafted items made by Ugandan women, she turned to FastTrac to help launch her business.

“FastTrac gave me tools and encouragement that empower me to empower others, and introduced me to valuable tools and relationships that helped get our business off the ground,” Bohannon says.

Even if you’ve already drafted a business plan, FastTrac can ensure you’re on the right path to business success. Whatever stage your business and business plan are in, there’s a FastTrac course for you. Your business plan is a living document, after all, and is likely to evolve just as your company will.

When you’re ready, simply register for FastTrac and start courses anytime. That’s one of the advantages of FastTrac—it happens on your schedule. Let’s get to work.

There’s nothing like the blank slate feeling of a new year. And that sense of a fresh start can be even more exhilarating if you’ve had this thought:

“I want to start a business.”

Of course, that exhilaration may be tempered by doubt, nervousness—even anxiety. Before you become overwhelmed by what’s ahead, let’s take a deep breath and start with the most important step: determining your personal vision.

WHY DO YOU NEED A VISION?

Your personal vision is what guides your entrepreneurial journey. It’s the very foundation of your business. And a vision is especially important because it will inform critical business elements like your business plan, market strategy and messaging, to name a few.

When you’re flooded by the burst of energy that comes from imagining yourself as a business owner, it’s easy to rush into a business plan, or building a website, or looking for office space.

In this moment, don’t worry about any of that. Those steps will come later. First, it’s time to focus on your personal vision and document it.

You’ve probably heard stories of wildly successful businesses starting from a few hasty scribbles on a bar napkin, or sketches on whatever scrap paper was in reach. No matter the medium, these are expressions of a personal vision: or, in other words, what you’re going to accomplish. Because when you’ve identified that key information, then you can start to plan how you’ll get there.

PERSONAL VISION VS. BUSINESS VISION

Before we dig more deeply into determining your personal vision—and where you go from there—let’s briefly examine the difference between your personal vision and your company’s vision.

Your company’s vision will likely be similar to your personal vision. A company vision serves as part of your business roadmap. The vision, in essence, is your destination. Then, you can define how to get there.

A personal vision, too, is the destination you want to reach, or the goal you want to accomplish. But your personal vision may be, well, more personal.

After all, your personal vision is what drives you, what pushes you, what motivates you during long days, late nights and as you navigate various obstacles and challenges.

Take Rachel Young, for example. She’s the founder of New Ocean Health Solutions, which empowers users to manage all aspects of their physical, emotional and financial health with ease, embracing long-term, meaningful lifestyle changes and chronic condition management.

Before she built her business, she defined a vision and passion, drawn from heart-wrenching personal circumstances.

“New Ocean is a passion that was prompted by pain—namely, the health struggles of my three younger brothers, who all died from a rare genetic kidney ailment,” she says.

The inspiration for your personal vision may also be one of loss, or of triumph, or simply of fulfilling a longtime need. Focus on your vision first; then, build that vision into your business and let it guide everything you do.

ANSWER THESE 3 QUESTIONS

If you’ve dreamed of becoming an entrepreneur, chances are high that you’re well on your way to defining your personal vision. But if you need help putting your personal vision on paper, start with these three questions:

1. What do you dream of doing?
2. Why?
3. What’s your biggest motivation?

Remember: the time to figure out the “what” and “how” comes later. This is a time to simply think big. Effective personal visions start with a 50,000-foot view. Then, as you start to create a course of action, you can consider narrowing the scope of your personal vision.

One other tip? Don’t be afraid to get personal. Again, your personal vision will overlap with your company’s vision, but they aren’t the same thing. This is the time to examine and identify what drives you. What keeps you up at night? What do you want to do, so much so that your life will feel incomplete if you don’t pursue this idea?

Now that your personal vision development is well underway, let’s take it to the next level.

EXPLORE YOUR PERSONAL VISION IN FASTTRAC

You’re well on your way to determining your personal vision. Feels pretty great, right?

Now it’s time to dig deeper into your vision and start to build the roadmap that will guide how you actually achieve that vision. That’s exactly what you’ll do with Kauffman FastTrac.

FastTrac is an immersive curriculum that’s designed for entrepreneurs in all stages, including aspiring entrepreneurs. The free courses are available online, which means you can learn at your own pace.

During each course, you’ll have a chance to immerse yourself in a particular topic. You’ll use tips, exercises and tools to think about your personal vision and your business idea, then identify how they match and how you’ll build your business.

It’s not always easy to make the jump from defining your personal vision to creating and launching your business. As she prepared to launch New Ocean Health Solutions, Rachel found herself in a similar struggle. That’s when she turned to FastTrac.

“In a business world full of noise, complex infrastructures and ‘sophisticated’ financing, FastTrac gave me—a full-time nurse and working mom/wife—the building blocks required to pursue my passion and my vision,” she says. “I give FastTrac credit for helping me move from crayon drawing to commercialization—one step at a time.”

Now, it’s your turn. Grab your lists, your notes, your crayon drawings—whatever you’ve got. Then, register for Kauffman FastTrac and start your journey to making your personal vision your personal reality.