Part 2: Writing the Competitive Analysis of The Business Plan

Analyzing the Competition
The competitive analysis section of your business plan isn’t just a list of information about your competitors; it’s the analysis of the information that’s important.

After gather all the information you can possibly find, and you analyze is thoroughly, you need to ask yourself one of the most important questions: How are you going to compete with that company?

The key for many small businesses is to focus on a specific market niche, where they can capture a target market whose needs are not being met.

Is there a portion of the market that your competitors are overlooking? Let’s take a look at our company Swolled. There a many retailers out there who sell everything ranging from vitamins, L-glutamine, whey protein, etc. Why not just specialize in lets say whey protein? Of course this wouldn’t really work in the supplementation market, so let’s take another outlook. Let’s say that you want to start a book store and your competitors are selling all kinds of books to all kinds of people. You might want to look into concentrating on children’s books or educational books.

Is there a service that customers and clients want and aren’t getting from your competitor? For example, you are starting up a repair service but none of your competitors offer in-home repair for televisions, computers, etc. You have just found a way to compete with your competitors. Start an in-home repair service.

The main goal of your competitive analysis is to find out what you can expand upon in your business to gain a competitive advantage over your competition. Find out the benefits that your business can offer to the customer or clients that your competitors don’t supply.

Writing the Competitive Analysis Section
Just like the Executive Summary, Industry Overview, and Market Analysis sections of the business plan, the Competitive Analysis section will also be in the form of several paragraphs. Make sure you also give each paragraph a separate heading.

To sum up the Competitive Analysis, in the first paragraph you will outline who your proposed business competitors are, how much of the market they control, and any other relevant details about your competition such as how much they sell their product for, and customer service.

The second paragraph will explain why and how your company will be able to compete with your competitors, and how you will establish yourself as a successful business.

Remember not to go into great detail here, but you do need to be able to persuade the reader of your business plan that you are knowledgeable about your competition. You need to show the reader that you have a clear definitive plan that will enable your business to compete with your competitors. Tomorrow we will be discussing how to start writing The Marketing Plan Section of The Business Plan.

Part 1: The Competitive Analysis Section of The Business Plan
Part 2: The Competitive Analysis Section of The Business Plan

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