One goal of every entrepreneur should be to get a competitive advantage in the marketplace. When you stand out from the competition by offering something of value that your competitors don't, you give your customers a better reason to choose your services. Without this advantage, you will get beat out by the competition time and time again.
Competitive Advantage and Benefits
As part of your business and marketing plans, you should list the benefits you plan to offer which distinguish you from the competition. This can include your prices, location, service, delivery, customer relations and even your personality. Conduct market research to see how you differ from your competition on these benefits and where you overlap. You should also take note of their competitive advantage and decide if you plan to compete with them in those areas. The more unique benefits you offer, the more customers will want to do business with you (rather than your competitors).
Competitive Advantage and Your Niche
When you work from home, you cannot be everything to everyone. You have to focus on providing limited products or services to a specific group of people: your niche. For example, an entrepeneur who wants to a open an online clothing store would do better if she focuses on brand name baby clothes, instead of clothing for men, women, and children. It's easier to establish yourself in a niche and be the "go to" person. It's also much easier to achieve a competitive advantage in a niche because of your dedicated focus to a very limited demographic.
Competive Advantage and Skills
The mistake that many entrepreneurs make when starting a business is to stop improving their skills. They allocate all available cash to their business to get it launched and neglect to save some money for education or training. You could gain a competitive advantage simply by getting trained in providing current or related products or services. You should also improve your entrepreneurship and selling skills. Make a list of your weaknesses and make a plan to build up the skills you need to overcome them. If you cannot acquire those skills yourself, then plan to outsource to an independent contractor who can provide you the necessary skills to compete effectively.
Competitive Advantage and Change
The marketplace changes as technology improves or as new technology is invented. You must be ready to adapt or change according to trends in your niche, or you will be left behind by your competitors. For example, Twitter changed how quickly websites can get traffic. Twitter allows users to communicate directly with their followers through conversation or by broadcasting news, information, and offers about their business. Followers visit the website to learn more. This is instant traffic, as opposed to waiting to rank high enough to be found in search engines like Yahoo! and Google. Those who are timid about using techonologial advances like Twitter are missing out on the oppotunity to stand out from the competition. Those who are using it have a competitive advantage.
Once you have identified your competitive advantage, do everything you can to sustain it in the marketplace. Review your competitors often to make sure you still provide those benefits better than they do. If you maintain your competitive position over the long run, you will have a profitable business.
Daphne Mallory, Esq. is the co-owner of Mallory Writing Services and has written more than 100 articles helping home based business owners and entrepreneurs start and market their business. You can learn more about her here.