1. Analyzing the Competition Lesson 16

2. Who is the Competition? Important for retailers to know who their competition is and to understand as much as possible about them – Drive around, phone book, search online

3. Direct and Indirect Competition Direct Competition: – A business that offers the same products as another and competes for the same customers Jeans and shirt business one mile apart Indirect Competition: – A business that offers products that are not the same, but that are similar enough to satisfy the same customer need Barbeque restaurant and a pizza place

4. Analyzing Strengths and Weaknesses Visiting competing stores – Products, pricing, appearance Great price but poor customer service

5. How Competition Affects Your Business Can help attract additional customers – Market Share: The percentage that a store has of the total sales in a area

6. Competition and Location Must assess both the direct and indirect competition in an area when choosing a location

7. Pricing and the Competition Pricing to meet competitors – Products are priced the same Increase sales – Price products lower than competition Added value – Price products above competition Other factors – Quality, Size, Customer Service

8. Competitive Advantage Advantage that a business can offer over a competitor's business – Customer service, selection, etc. Must be perceived as a value that they cannot get elsewhere

9. Developing a Competitive Strategy A combination of all things competition is needed to be the best business in the area