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What are competitors in business? A competitor is a word often used to replace competitors in a particular business. Of course, when defining a business strategy, we need to understand our competitors so that we can excel at our business.

Of course, to figure out how to set a strategy for dealing with competitors, you must first understand the definition of competitors, the triggering factors, and the types of competitors. Come on, read the following article to the end!

What is a competitor?

Of course, when we talk about business competition, we often hear the word competitor. But what is the true meaning of competitors? In the definition, a competitor is a noun meaning “people who compete”. However, the definition of competitors in business is more detailed.

So what are competitors in the business? The definition of competitors according to some experts is as follows.

According to Friadi et al. (2022), the definition of a competitor is an individual or company that sells or manufactures similar or similar products to ours in the form of goods or services, whether in form, utility, or function.

According to Africani et al. (2022), the term competitor refers to competitors in companies that have products similar to ours.

According to Santoso (2017), the notion of competitors is a business with flows and offers more or less consistent with our business.

From some of the definitions above, it can be inferred that competitors are individuals or companies that manufacture and offer products in the form of goods or services similar to the outcomes of our products intended to be offered to consumers.

 

Competitor trigger factors

Competitors may be present for business competition. Having understood what a competitor is, you will know the causes of the emergence of business competitors. Competitor trigger factors are as follows.

 

  1. Existing or new similar products

The product is one of the most important variables in business. The decision to manufacture or research an existing product is one of the factors that drive competitors. In addition, the emergence of the same new product is also a factor that triggers competitors for predecessor entrepreneurs.

 

  1. Wrong choice of location

Choosing a location is very important for running a business. There may be other individuals or companies that “steal ideas” prepared for a company. Then those competitors can open stores in other more strategic places.  For business founders, it is important to reconsider the choice of location in order not to choose a location that has many competitors.

 

  1. Product does not meet market expectations

If a product does not meet the wishes of consumers, this can be a fertile field for competitors. Therefore, market trends and expectations need to be monitored to keep the product selling well.

 

types of competitors

Of course, to know how to measure yourself against competitors, competitors from your company must be identified. According to Tanuwidjaja (2010), the types of competitors are as follows.

 

  1. Direct competitor

In principle, every company has direct competitors. Direct competitors are companies whose products are the same in form, function, and use as the products you manufacture or sell.

 

  1. Indirect Competitors

Indirect competitors are more extensive than direct competitors. This is because these types of competitors offer a replacement or replacement products. Goods can take different forms, but they have the same functionality and utility as your company’s products.

 

  1. Big competitor

This type of competitor is usually feared by novice entrepreneurs. Typically, large companies that fall into this type already have stable businesses and profits, as well as loyal customers. His marketing budget is also pretty crazy and well known. For clarity, you can listen to the following case study examples to better understand the types of competitors.

You are an entrepreneur doing business with eco-friendly bar soap products. Its direct competitors are any company or person that manufactures bar soap products. Indirect competitors are all manufacturers of liquid soap products. The big competitors are companies with well-known brands like Unilever and Wings.

 

Advantages of competitors

The above types of competitors can be scary for entrepreneurs who are just starting their businesses. However, there is a positive side to the existence of competitors, you know. The advantages of the competitors are as follows.

 

  1. A place of inspiration for business

Competitors are a source of inspiration for your business. If you manage to analyze your competitors well, you can come up with even more creative ideas.

 

  1. Can be a business partner

You know, that’s one of the most powerful ways of doing business, turning competitors into partners. Indirect competitors are usually better partners because the resulting collaboration is more optimal and can complement each other’s weaknesses. In addition to indirect competitors, you can invite larger companies to cooperate or become partners.

 

  1. Motivation in business

Healthy entrepreneurial competition is very good for the economic situation of a region because the products of the individual companies can be more diverse and innovative. Therefore, make competitors your motivation to do business.

 

Strategies for confronting competitors

Well, now you know your competitors and you know the benefits. In order not to be afraid of competitors, here are some strategies on how to compete with competitors.

 

  1. Conduct company research and reviews

If you run a business, then always research to improve the business. Research is carried out before the company is founded, for example when looking for business ideas that are to be implemented. Running a business also requires regular research. You can use the SWOT (Strength, Weakness, Opportunities, Threats) analysis method to research companies.

For example, when researching a product, you can start by analyzing its strengths and weaknesses of the product. In addition, opportunities and risks that affect your product from the outside can also be analyzed. Consumer or market research is also possible, for example, based on which products are people searching for. Which products are particularly in demand? You can later apply the answers to come up with innovative business ideas. After completing the deal, do not forget to always evaluate the executed deal. Set a goal so it can be a benchmark for evaluating your business.

 

  1. Conduct a competitive analysis

Competitor analysis is, of course, a way to measure yourself against key competitors. You can examine the pros and cons of competitors’ products or marketing methods. Set points to differentiate your product from the competition’s products. Meanwhile, marketing methods can be used as inspiration for marketing your products.

 

  1. Increase promotion and build good branding

Advertising and branding are a cornerstone to competing with the competition. If your product is unique but not advertised, it’s useless. Create an image or personality that fits your brand, then promote it as best you can. Pay attention to social media trends and society’s hottest topics. This will help you find inspiration to advertise.

 

Well, now you have a better understanding of what competitors are in the business, the triggering factors, and how to strategize to deal with competitors. Hopefully, as an entrepreneur, you can compete healthily with competitors, OK!

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