Competitive Analysis

Objectives

1. To show that you are fully aware of the

competitive forces at work in your
marketplace.
2. To explain your strengths over the
competition and how you will counteract
their advantages and overcome or
compensate for your weaknesses.
Who are Your Nearest and Largest
Major Competitors?

Is their business steady, increasing, or decreasing?

Why?

What are the similarities/ dissimilarities between your

business and your competitors?
 How Does Your Business Compare to Your
Competitors’ (strengths & weaknesses of
each)?
 In length of time in business?
 In sales volume (units and dollars)?
 In size and number of employees, suppliers, and
support personnel?
 In number of customers? Share of market? Product
niche?
On What Basis Will You Compete?

 Product Superiority
 Price
 Advertising
 Technology/Innovation
 Other
How is Your Business Better?

 Operations  Price
 Management  Service
 Product  Delivery
 Other
What Have You Learned by Observing
Your Competition?
If you have no competition, what kind might you create by
being successful in the marketplace?

Do you threaten the major strategic objectives or self-image

of the competition?

Will you seriously affect their profits? (Will they attempt to

destroy you at any cost?)
Writing the Competitive Analysis

Subheadings to Include:

 Competitors’ Profile

 Product/Service Comparison

 Market Niche and Share

 Comparison of Strengths and Weaknesses

What to Accomplish

Give a brief rundown on the other industry

participants. Highlight your particular

competitive edge.

The following is a suggested sequence

of presentation.
Competitor’s Profile

1. Discuss the competition: size, age,

locations, sales volume, management,
mode of operation, and other
characteristics.

2. Discuss potential competitors who may

enter your market.
Product/Service Comparison
1. Discuss the similarities and differences
between your product/service and that of
the competition.
2. Compare your operations and
management style with those of your
various competitors.
3. Highlight whatever it is that makes your
product/service and company more
attractive in the marketplace.
Market Niche and Share
1. State the approximate percentage each
of your competitors holds in the market.
2. Discuss those that hold the large
percentages and why they have an
edge.
3. Discuss the competitors who have
come or are coming on strong and are
making (or expected to make) bigger
gains in the market.
Market Niche and Share
6. Discuss the particular segments of the
market that each of your competitors
addresses.
7. Discuss your niche in relation to these and
what percent of the total market it makes
up.
8. Describe where the market is headed and
how each competitor’s niche and share
may change over the next three to five
years.
Comparison of Strengths and Weaknesses

Discuss your strengths and weaknesses in relation

to your major competitors.

Focus on: product superiority, price advantages,

market advantages (large contracts with
customers or suppliers, proximity to larger
market, proximity of labor supplies, raw materials,
energy, transportation, land, or other resources),
and management strengths and weaknesses
(experience and track record, skills, etc.).
Common Mistakes to Avoid
 Not identifying known major competitors
 Underestimating competitive strength and potential
 Failing to demonstrate your competitive edge -- what
makes you unique or better
 Having no strategy for counteracting current
competition or emerging competition
 Assuming you have no competition
 Failing to show an awareness of competitors’ plans in
the market and their business cycles.