FCG Forum

The Art of War with Your Competitors
12.19.2008

We all know a company’s first impulse when bracing for an economic downturn is to cut costs.  Smart electrical distributors also employ a dual guerilla tactic to take market share.Both electrical distributor revenue and profitability are at risk during an economic storm.  Cost cutting can only take a distributor so far.  It is a short-term strategy.  Revenue growth comes about during an economic downturn by intelligently taking market share. 

Winning is not cutting costs.  It’s taking share from your competition.  Taking share is “The Art of War”.  War is the ultimate competition.   “The Art of War” is a Chinese military study that was written by Sun Tzu around the year 500 BC.  It is the first and one of the most successful books on strategy.  Sun Tzu was the first to recognize the importance of changing conditions in a competitive environment and positioning strategies. Even today under the most competitive of circumstances most electrical distributors do not know very much about their competition.  They fail to exhibit strategic judgment by systematically observing their competition, collecting important data, and analyzing results.  The essential component of any sound corporate strategy is a thorough, objective analysis of the competition, benchmarking your performance versus the competition from your customer’s viewpoint, followed by a comprehensive positioning strategy.  

There are five (5) tools to assess your competitor’s strengths and weaknesses in every target market (i.e. mid-size commercial contractors, large commercial & industrial contractors, residential contractors, manufacturers, utilities, institutional, etc.) in order to develop both offensive and defensive actions:

1.      Know Your Enemies = Competitor Profiling

2.      Rate Your Enemies = Competitor Analysis

3.      Rate Yourself Versus Your Enemies = Customer Satisfaction Benchmarking Survey

4.      Position Your Enemies = Competitor Positioning Strategy

5.      Defeat Your Enemies = Strategic Positioning Strategy

To gain access to the complete Electrical Wholesaling article please visit our Resources section.

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