One of the most critical questions any company executive should be able to answer is “What makes your company different and better than your competitors?”
Unfortunately, many business owners see themselves in the commodity market and don’t have a differentiating product, service or feature. As you review this question, if nothing comes to mind, your company is simply just “another one” and like every body else, all your competitors.
You need a big wake-up call.
Why? Because you may not be able to stay in business through the next decade if you do not find a way to stand out from the crowd.
As you read this column, don’t just read. Take out a piece of paper and answer these six critical questions. It shouldn’t take more than 30 minutes and they could be the most valuable 30 minutes you’ve spent in months.
- What is your company better at than all of your immediate competitors?
- Do you offer any unique and profitable product or service that none of your competitors currently offer and would be difficult to copy?
- Why do your customers buy from you rather than your competitors?
- Looking at your answer to #3, will you be able to sustain the same competitive advantage in the coming years? If so, how? If not, what will you need to do to have something else take its place?
- Of all your products and services, which ones do you see having the greatest potential for bottom-line profits over the next five years?
- How much of your time and total resources are being devoted to the most valuable products and services you identified in #5? Is your effort commensurate with the importance and if not, what will you do daily to emphasize those products and services?
If you are not sure how or if your company stands out from the crowd, a good starting point is to ask your employees. The closer an employee is to your customer, the better they will know the true reasons customers buy from you rather than your competitors. If the primary reason customers buy from you is because you have the cheapest price in town, your company may be in for a rough ride when hypermarket competition heats up. Unless you can continue to be the lowest-cost provider, you will lose considerable market share to the big box price leaders
Hopefully, you answered question #3 with a customer buying reason that is something other than price. By discovering why customers buy from you, and then coupling that information with your answers to the other five critical questions, you will begin to see a clear path to your company’s future success.
Successful companies capture customer “mind-share” and they do this by standing out from the crowd. Companies stand out through image (including branding), service, offerings and innovation. Savvy business owners always think from the customer’s perspective. Focus your company on providing what your customer needs before they even know they need it or ask for it, and you will hit the profit jackpot.
Meridian Associates has been partnering with family-owned businesses for over 30 years to remove barriers, accelerate business growth, build their legacy, and reduce stress levels. With three, high-impact business events each year, The CEO Exchange, Women in Family Business, and The Family Business Intensive, we continually provide best practices & proven strategies that keep multigenerational businesses thriving. Discover how Meridian can help your business thrive through our combination of high impact business coaching, advisory, M&A, and precision company valuations by visiting www.askmeridian.com or calling us at 817-594-0546.
