Who Is Your Real Competition?
(The Answer May Surprise You)

by Tom Egelhoff

Competitors! We hate 'em. They are the primary reason your business isn't doing better. Right? They cut prices, steal customers, say terrible things about you and your business, keep you up at night, cause stress in your life and lie in their advertising.

You blame every business failure and set-back on them. But, are they the real cause of your problems?

Who Are Your Real Competitors?

My inspiration for this article was a recent conversation I had with a local business owner. I was asking him about the fiercely competitive nature of his business and how he handled it. He said, "My toughest competitor is...time and materials. Those two things affect my business more than any competitor."

I had never really thought of internal forces as a "competitor."

As he continued his explanation I could see that it made perfect sense. Internal forces within a business can be just as harmful as a strong outside competitor. For example, poor customer service drives your customers to your competitor.

New Definition

So, I now have a new definition of the term "competitor," and so should you. My new definition of a competitor is any "entity" that causes a reduction in profits or negatively affects the reputation of the company. Internal or external.

So, under this new definition, who is your real competitor?...it just might be you.

Where should you concentrate your efforts?

With this new definition in mind you must look at your business from a whole new perspective. There is a real positive in this new definition. You have some control over what happens inside your company. You have very little control, if any, over what your competitor does. Concentrate your initial efforts within the confines of your company.

Positive policies you implement within your company can often overcome anything an outside competitor can throw at you. The first place to start is with your customers.

I Can't Define Customer Service, But I Know It When I Get It

Countless reams of paper have been used to document the benefits of good customer service. I have yet to talk to a business owner who didn't think their business delivered anything less than excellent customer service.

Here are two observations of customer service, or lack of it, from businesses I frequent.

I use the drive-up facilities of two banks here in Bozeman, Montana. At one bank, no matter which teller I get, they always call me by name regardless of the size of the transaction. At the other bank, no matter which teller I get, they never call me by name regardless of the size of the transaction. Try and guess which bank makes me feel better after the transaction.

Here is one of my real pet peeves...grocery stores. I hate to issue an "across the board" condemnation of one segment of business, but this happens everywhere.

As most of you, I spend what I feel is a fair amount of my hard earned money at the grocery store. When it's my turn the checker always says either, "Hello", "How are you today?" or some other similar greeting. That's great, that's what they should do.

However, once they've finished scanning my selections and given me the total, for all intents and purposes, their job is done. I suddenly become a non-entity. While I'm filling out my check, they totally ignore me and start talking to the bag person or the next cashier or any other employee within ear shot about their week-end or someones party.

The time for idle chit-chat with others is when there are no customers in line. Show me any other business where this activity would be tolerated. Every customer should always receive undivided attention throughout the entire transaction regardless of the industry.

Rarely do they call me by name even though they have a check with my name on it. A simple thing like calling people by name, as soon as you know it, should be a mandatory activity for every business.

Other Internal Competitors Of Your Business

I talk with a great number of businesses each month. I see the good, the bad and the really ugly. I try to look at each business as a customer would. Here are some of the things I look for:

Successful businesses aren't always neat, but they are usually clean. Particularly the areas that customers see.

The employees are usually dressed better than the customers. That doesn't mean coats and ties but they take pride in their work and show it with a clean professional appearance.

Business cards, stationary, brochures and invoices all project a positive business image. They don't have to be printed on expensive paper, but they are professional in design and information.

They answer the phone in a professional manner. Everyone who answers the phone is qualified and trained to answer whatever questions the caller may have. No one likes to call and repeat the question over and over again as they go from person to person looking for help.

According to Murphy's Law, customers with complaints will always show up when management is gone. Employees are empowered to resolve customer complaints without management intervention.

The Last Word On Internal Competition

Every business spends time evaluating their competition. In addition to your external competitors, make it a daily practice to look at your internal competitors.

Keep in mind, the goal of external competitors is to attract your customers away from your business. While the result of internal competition is to drive your customers away from your business.

The less control you have over your internal competitors, the more your external competitors like it. Start being competitive internally and make your external competition lose sleep for a change.


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