The Advisor

BUSINESS DEVELOPMENT -
WHAT IS YOUR COMPETITIVE STRATEGY?
by Robert Sullivan, author of "The Small Business Start-Up Guide"

Business Development? Competitive Strategy? What does this have to do with my small business, anyway? I'm doing just fine - plenty of customers, fairly good profit margin - making a good living! Do I need to mess with success?

Good questions. The problem is that business has a way of changing - and sometimes more quickly than you might think.

• You lose customers to a new storefront down the road
• You lose business to the big new "discount mega-mall" down the road
• You lose customers due to mail order and internet competition
• You lose sales due to price competition
• You lose business because of new, unique competitive products
• Your "natural" growth slows down or stops

INTRODUCTION
You won't find "Business Development" in the index of most business books. This is because it is not a simple concept - it covers a number of important business activities the most important of which are strategic planning, market development and product development. In other words, business development covers those areas that must be addressed in order to sustain a successful business. The objective is to ensure a continued supply of customers for your product or services and product development to ensure you maintain adequate market penetration.

WHAT IS YOUR MARKET POSITION TODAY?
It's important that you understand your own market niche and your business competitive edge - that is, what is it you do that is better than the competition. Your own list of customers should reveal this information. If you're not already doing so, start collecting as much detail as possible from your customers. One effective way to do this is by using surveys and offering a free token gift. Use e-mail if possible (efficient and cost effective) or mailings in which you include a dollar bill as a "reward" for completing your survey.

EXAMPLES OF COMPETITIVE STRATEGIES
Your business will grow only if you give continued attention to your products/services and their marketing. Part of your strategic planning should include items such as:

• Research your competitors. Know what they are doing - how can you improve on their methods. Collect data using the internet, "secret" shoppers, requesting their product or service brochures.
• Revisit customer service and policies. As a small business one of your strengths is the ability to provide exceptional, personal customer service. Make sure you're doing this. Ensure that all your employees understand that they are really working for the customer, not you.
• Co-Op with other small businesses. This can be a powerful and economical way to market. Find potential partners at local civic and business meetings.
• Franchising. At some point in your business growth, franchising may become a viable way to grow. Careful market research is required to determine if your business is a candidate for franchising. There is plenty of good information on the Internet to assist you. Reference: "Franchise Bible: How to Buy a Franchise or Franchise Your Own Business" by Erwin J. Keup.
• Develop new niches. Developing a new market niche can be a powerful way to grow your business and outdistance the competition but beware - ensure the new niche stays within your core competencies. Remember, don't try to be everything to everybody!
• Market development. Never stop considering new markets. Again, thanks to the Internet, finding information to assist in this quest is easy. For example, expensive market demographic information is free. Check out the Internet site at http://www.amcity.com/journals/demographics and at http://www.onlinewbc.org/docs/market/mkt_researchA_trad.html
• Product development. This is as important as market development. New products (and services) are mandatory for growth. Again, be careful and don't consider products/services that are outside your niche(s) or expertise - expand within your present niche. Talk with your customers! Ask them what additional products they feel you should offer. This can reveal some gaps in your current product line.

Unrealistic guarantees or other promises. Under promise and over deliver. A broken promise is a sure way to lose customers.

Copying the competition. It's always a good idea to study the competition but don't simply copy an idea, improve on it first.

CONCLUSION
Update your strategic plan (you have one, right?). Ensure you have included market and product development as part of your business development model.

The Small Business Development Center (SBDC) Program provides management assistance to current and prospective small business owners. SBDC's offer one-stop assistance to small businesses by providing a wide variety of information and guidance in central and easily accessible branch locations.

The SBDC Program is designed to deliver up-to-date counseling and assistance in business development. SBDC services include assisting small businesses with financial, marketing, production, organization, engineering and technical problems and feasibility studies. Visit http://www.isquare.com/sbdc.htm for a complete listing of all SBDC offices throughout the United States.