When you are going to develop a business plan that includes a competition section in it, all of the companies and organizations must be able to define what a competition is correctly, select various competitors for analysis, and even explain its advantages and disadvantages. Companies are obliged to align their definition of competition especially when they involve themselves with investors. Some of these investors know competition as a service or a product that can be used to fulfill the needs. This condition usually includes or engages firms who are offering the same type of product, substitute products, and even other customer options like rebranding. Any specific business plans that claim that there are no existing competitors undermine the credibility of the management team.
The competition section in a business plan is usually considered to be the most difficult section when you are on the process of writing a business plan. It is due to the fact that before you are going to analyze your competitors, you still have to undergo investigation on them. You can really learn a lot from the competitive advantage, market opportunity, and your position in your business by simply looking at the competition. It is important to basically know who are your competitors, how they operate, and what are the benchmarks that you need to hit to be able to achieve success in your business. This will also serve as an analysis in which most of your investors would want to see.
10+ Competition Business Plan Samples
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How to Identify Competition?
Think of this question: what kind of businesses are most likely to jump in when you are going to create a new market? That is competition. Do not ever think that there is no competition at all. In order to identify your competition, you have to do a competitive analysis in your business plan. Here’s how:
- Define your business use – you should first decide on which business uses you are going to apply: internal management plan or formal business plan. An internal management plan usually serves as a vehicle for understanding what competition is and in developing strategic positioning. You must look on both the strengths and weaknesses as this will lead you to having a solid strategy. A formal business plan allows you to describe what a competition is to assure you that you will be aware when it comes to that specific matter and you are in position to take advantage of the various opportunities.
- Establish a competitive position – you have to be aware of how your business actually works, like in terms of what it offers on a chosen target market. There are several tactics that you can use which includes messaging, distribution, and pricing. Your goal is positioning and assessing yourself what you are doing better. You may also ask yourself if how you manage your strengths and weaknesses.
- Establish regular competitive review channels – you should be able to know your business needs. The competition section in your business plan will guide you in making the right decisions for you to measure its value using the decisions it causes.
What are some of the questions that you have to answer when conducting a competition analysis?
- Who are your competitors?
- What are your competitors’ products and services?
- What threats does the competitor show?
- What are their strengths and weaknesses?
- What are their objectives in the market place?
- What strategies are they using?
- What market segments are they operating?
- What makes their product good?
- Why do customers buy their product?
- What are their available resources?
What type of information are you going to include in your plan for each competitor?
It includes competitor’s name, overview of the competitor, products or services offered, pricing, revenue, location, customer segments, their key strengths, and key weaknesses.
There are a lot of business plans that show off their business ventures. When you are positioned properly, it may be a positive sign due to the fact that it simply implies that the market size is big. If you want to see more samples and format, check out some competition business plan samples and templates provided in the article for your reference.
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