Make your business unique

We need a differentiator; as an industry we’re being commoditized. We won’t be able to stay in business forever unless things change.

Thoughts of the day: Offering something unique boosts profitability and chances for survival in any small business. Avoid price wars. Turn away some buyers in order to create value. Don’t get complacent. Be nimble.

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Getting An Edge On Competitive Advantage

You’ve talked before about firms having a competitive advantage. What does that mean? How can my company develop a competitive advantage? And is it worth the time and effort that will go into making that happen?

Michael Porter has written extensively on Competitive Advantage (CA). He states that CA, “grows out of value a firm is able to create for its buyers that exceeds the firm’s cost of creating it.” He proposes that companies achieve CA by, among other things, “providing unique benefits that more than offset a higher price”.

One of the most difficult questions for many small businesses to answer is, “What makes your company truly different?” The answer can lead to greater profits, barriers to entry for potential competitors, longer lasting high-quality clients, increased sales effectiveness, and hiring advantage.  Think of Competitive Advantage (CA) as a series of tools that set one company apart from all others.

One place to work on developing a company’s CA is in marketing. Usually your best customers have already figured out why your company is the best-in-class, when it comes to meeting their specific needs. Ask those companies to explain what they appreciate about your firm, and why they keep coming back for more.

Be aware of what your competitors are doing, similar to, and different from, what your company is doing. In the words of your best customers, define what sets your company apart. Focus on honing and expanding those skills and qualities that your best customers most appreciate about your company.

List traits that identify your best customers.  Then do research to find other prospects that fit your best customer characteristics. Build a database of current and future best customers. Use that database as a competitive weapon. Cut down on wasted effort trying to appeal to poor quality targets.  Tailor your marketing to attracting and nurturing prospects and clients that have the highest potential to be best customers.

Involve your sales force in attracting and keeping best-in-class customers. Make sure they know how to identify one. Also have them well prepared to educate the marketplace about what makes your company different. And ask them to keep their ears open for news on what your competitors are up to.

Develop unique systems for doing what your company does, as another sure way to create a competitive advantage. Make sure that your process delivers a superior outcome, a better price : payoff ratio, or otherwise results in something that buyers can’t get anywhere else. Be aware that knowledge of systems is portable, and ask all employees who have privileged knowledge to sign non-compete and non-disclosure agreements.

Look at how your company acquires materials and personnel. Can you corner a market on materials? Do your employees have special skills? Is your company a more attractive employer because of stand-out results with best-in-class customers? Can you translate this into a better product, service, or payoff ratio, as compared to what everyone else has available?

In the long run, what you end up with is customers who buy from you based on the value of what you sell. Using CA, you get away from competing on price, which is a slippery downhill slope. You protect and expand market share because your company is the top game in town at what it does, and you make sure everyone knows that.

Be aware that Competitive Advantages are not permanent. The marketplace is always evolving. Competitors are always looking for ways to expand and improve, as is your company. New resources and technologies become available. Improvements in education can turn into a game changer. Old customers fall away and new prospects arrive on the scene looking for better solutions.

Keep your company out front. Constantly look to improve your appeal to your best customers. Identify that next niche by testing new products on old customers, and launching your best products or services into new markets. Continuously test and update your company’s list of competitive advantages, to insure you company stays on the forefront of the profit and value propositions.

Looking for a good book? On Competition, Updated and Expanded Edition, by Michael E. Porter.


Andi Gray is president of Strategy Leaders Inc.,, a business consulting firm that specializes in helping entrepreneurial firms grow. She can be reached by phone at 877-238-3535. Do you have a question for Andi?  Please send it to her, via e-mail at or by mail to Andi Gray, Strategy Leaders Inc., 5 Crossways, Chappaqua, NY 10514. Visit for an entire library of Ask Andi articles.

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