The greatest resource for a small business is its customer list created from the identified target market. Your target market is vital to the survival of your small business; it is your resource base. You provide your customers with the product or service, and in return they support your business by continuing to purchase your product or service. One of the biggest problems with a small business is that there is always somebody who comes along wanting to compete with you for your customer base.

You are vulnerable in a number of areas because your customer base may be loyal in the short term but can easily be hijacked by a better offer. Competition occurs when some other business wants your customer base and takes an aggressive approach to lure away your customers. Sometimes they will compete on price by cutting their prices for a similar or competing product. They will do the same if you provide services. Another area where you are vulnerable is quality. Your competitor may produce a better product or a better service and will use this to attract your customers away from you. A more enterprising competitor may suggest that your product is not environmentally sound and they have one which will help prevent global warming.

To counter the moves by your competition it is necessary to be alert to the possibility of competition. If the competition continues too long you might find that your business is no longer viable because they have stolen your customer base. In this respect, you have to move quickly and it is prudent to set up countermeasures in advance of an attack by your competitors.

If your competitors want to compete on price, don’t fall into the trap of discounting your product and playing the game on their terms. Add value in the form of extra information, services or products. You can use exactly the same strategy when you are subjected to an attack on quality. You can present your goods or services in such a way that it is impossible for your consumer to accurately compare your product against anyone else’s. This also gives you a strong selling point.

Facing the competitor with the magic product that is so environmentally friendly that it will help prevent global warming, is a challenge. The reason why it is a challenge is because global warming is such an emotional factor. Your defense can be to produce a product which is equivalent to your competitor’s environmentally friendly one. You can gently suggest that the science is not yet proven, or continue to add value so that your customers recognize the value of your product against one that is purportedly environmentally pure. Whilst it is tempting to badmouth your competitors, I suggest that you develop other techniques.