Images Magazine Digital Edition February 2019

KB BUSINESS DEVELOPMENT 44 images FEBRUARY 2019 It’s not awar P epsi has Coke, Apple has Microsoft and the mom-and- pop corner store has another mom-and-pop corner store. Competition is as certain as death and taxes. The ethics of competition Business should be conducted competitively, but ethically. While I do discuss outwitting, outmanoeuvring and outperforming competitors, it is in the context of a competition, not a war. Think of small business as a game you plan to win. But even while basking in the glow of victory, be gracious enough to shake your competitor’s hand and buy her a drink. Actual competition It’s necessary to identify your actual competitors. If you don’t do this, you could end up like an errant coonhound wasting your time barking up the wrong tree at the wrong quarry while the raccoon you should be watching sneaks up and bites your butt. A coffee shop owner I met in South Africa provides a good example of barking up the wrong tree. He told me Starbucks was coming to South Africa and he was losing sleep over it. To hear him tell it, Starbucks was a vampire about to stroll into town and suck the lifeblood out of his small business. I suggested that he think differently about potential competitors, pointing out that the threat probably wasn’t anything near what he was anticipating. His scepticism was still palpable even after I told him Starbucks was just one of the five coffee shops in as many blocks on Fourth Street, Calgary, and that Purple Perk, a family-owned coffee shop on the opposite side of the street from Starbucks, is consistently busier. Far from being concerned about Starbucks, Purple Perk co-owner Paul Overholt saw advantages in having it close by. His well-reasoned strategy struck me as a classic example of how a small business can outmanoeuvre a large competitor by exploiting its weaknesses. The surrounding neighbourhood, Michael Best looks at how to identify your competitors and how to treat them Mission, is home to an eclectic population that Paul judged would favour a neighbourhood coffee shop reflective of the look and feel of the area. One way he conveyed this was through incorporating ceramic tiles from buildings being renovated in the area into the floor of his coffee shop. His purpose was to subtly create a sense of familiarity for customers. By contrast, as Paul pointed out, the Starbucks across the street is cookie- cutter typical of the chain’s standard architecture, standard interior and standard corporate palette. Paul knows that many of his patrons have an aversion to foreign- owned multinationals. This is what I mean by identifying your actual competition. There is bound to be some overlap of customers, but for the most part Starbucks is an apparent rather than an actual competitor. Paul’s actual competitors are the other privately - owned coffee shops on the street. By not distinguishing between apparent and actual competitors, you waste time and energy barking up the wrong tree. Rather than being concerned about the green mermaid across the street, Paul welcomes her presence, saying: “Her visibility raises the profile of coffee and the concept of coffee shops to the advantage of all privately- owned coffee shops in the area.” The lesson for all small business owners: identify your actual competitors, understand their strengths and weaknesses, and then adjust your business model to stay ahead. You should also know what your competition is up to at all times so you’re not caught by surprise and end up with a sore butt, like an unobservant coonhound. Binoculars There are different w ays of keeping an eye on your competitors. I knew a service station ow n er in Calgary who kept a close e y e on the per litre petrol prices his co m petitors up and down the street w e re displaying. This was what the bino c ulars under the counter were f or. A few times a day he would reach for the binoculars and check the competit o rs’ advertised prices. I do n ’t mean to suggest you should obs e ssively watch your competitors, but it should be part o f your routine manage m ent activities – being oblivious could have consequen c es ranging from a slow dete r ioration in your competitiven ess to a sudden, damaging, u n pleasant surprise. How you g a ther intelligence on your com p etitors is i mportant. Keep good ethics in mind and d efinitely don’t do anything illegal. You can learn much about your competitor s through trade shows, adv e rtising material, websites, p r ess reports, customer g o ssip, mutual suppliers, co u riers, truckers, social media pages and perhaps even surrept i tious visits to their premises. What a n d why So what should you know about y o ur competitors? The short answer is