What makes your business special?

To succeed in the long term, you need to have a clear view of what makes your business stand out from the rest. Your customers need to see what makes your business special.

A competitive advantage is something that you offer to your customers that your competitors don’t have. In the busy marketplace, people need compelling reasons to pick your business over other businesses. You need to identify your point of difference.

Your point of difference is even more important if (like most businesses) your business offers similar products or services to your competitors. The more similar your business is to many others, the greater your need to develop competitive advantages.

Make sure you identify the benefits you offer — not the features of your product or service. To clarify the benefits, try using the question ‘So what?’ to dig deeper into what the customer is going to get. What advantages will they get when they buy from you — will they save time, receive a product which lasts longer, get better value for money?

Think about your market — are you targeting people in a particular industry, age range, or lifestyle?

Your business will be more appealing to potential customers if it addresses a need they have and can make their lives better.

First, write a list of other businesses that are competition to yours. Do some research online and survey your potential customers. Your competition isn’t just the obviously similar firm down the road. It might be a much larger company or a sole operator. It might be an online business or a community collaboration. It could even be a completely different product or service, for example a personal trainer and a health food store may be competitors if they share a potential customer that has a limited budget.

Think about the range of products or services others offer and how they compare to yours. How well does your business compare?

You’ve identified the benefits of your business for your target market and considered what competitors might offer. Now it’s time to develop your concept and describe what makes your business better than the rest.

Three main areas can form your competitive advantage, and you can choose to combine more than one of these:

• Cost leadership
• Focus
• Differentiation

You’ll need to make sure that your competitive advantage strategy will be sustainable for your business.

Cost leadership means you can offer something of value at a lower price than others. However, make sure you don’t under-price. You need to pay fair wages (to yourself and staff) and use quality inputs — materials or expertise — to deliver value to your customers.

Focus means delivering products and services to a particular market that hit the mark better than those of other businesses. Products or services targeted to a clear market segment are examples of focus.

Differentiation means you have a clear advantage over the competition. For example, you deliver high-quality or specialist products or very fast services to your customers.

As the business owner, remember that you’re a competitive advantage yourself! No one else has quite your mix of skills, experience, and vision. Customers come to your business because of the expertise and vision you bring to it. Your technical expertise has a big part to play in your business brand and values, which feeds into your business reputation - a unique aspect to your competitive advantage.

Offering a unique product or delivering an exclusive service gives you an advantage. Showing innovation gives you an edge in the market too. Use your marketing to emphasise your difference. In your sales process, use your technical knowledge to inspire trust.

Choose your staff with care — they can be the difference that makes customers come back again and again. And customers will recommend your staff to others if they get great service.

If you offer a complete package of services, you can be a one-stop shop. People will come to you because they can get all the things they need. Make sure you keep your customer base up to date with everything you offer.

Treating your suppliers well can give you a competitive advantage. Having their loyalty helps you to deliver on your brand promise. Pay suppliers on time, and let them know about any changes you’re planning that might in turn affect their business. If you’re one of their major clients, changes to your orders can affect things like how promptly they can deliver to you or discounts they can offer.

Find a location that suits your business. If you’re offering courses for business people in the CBD, make sure your training room is easy to access for city offices. If you have a specialist shop, find a location with high foot traffic. If your business is online, secure an appropriate web address that’s easy to remember.

Getting your business out to customers with business-to-business accounts, free pick-up and delivery, drop-off points, or wholesaling means your location isn’t so important. You might be able to save on property leasing costs too.

Your continued success depends on keeping on top of your competitive advantage. Communication is crucial — with your staff and your customers.

Communicate with your staff — get their insights and ideas for improvements, and involve them in marketing efforts. They’ll appreciate feeling that their insights are valued — and they’re sure to have ideas you haven’t thought of.

Even a small amount of marketing will contribute to future sales. Try to allow a regular amount for marketing each month. Start with a modest but achievable marketing plan, and build on it as you grow. Marketing through social media can be very cost-effective, and helps to spread the word.

Keep in touch with your customers - survey them and ask for feedback. Feedback helps you sharpen your service levels and target your customers better. When you get great feedback, ask for testimonials you can use in your promotional material.

Once you feel like you’re making headway, consider getting a snapshot of customer feedback through a survey of your Net Promoter Score. This specialist survey looks at how likely your customers are to recommend you — the essence of your competitive advantage. It uses a formula that calculates the difference in results between ‘promoters’ and ‘detractors’. You can commission a third party to conduct the survey and report back to you.

Keeping in touch with other business owners gives you a great feel for what’s going on in the market and where you sit. Go to business networking events, and read reports and surveys from a local chamber of commerce and other business hubs.