How to Protect Your Business Against Competitors
How do you handle new competitors? Do you allow every new player to enter your market easily or do you go out of your way to intentionally build barriers to discourage them to play?
This is a big question lingering in the minds of many entrepreneurs. More importantly, this one of the 10 difficult questions venture capitalists and angel investors are going to ask you, according to Instigator Blog.
Brutal or even unfair as it may seem, pre-empting competitors to enter the market is more practical than letting them compete and take your chances. Here are some tips to protect your business against approaching competitors:
Be Exclusive
If you are using a unique technology or raw materials, you may want to sign an exclusive agreement with your supplier so your competitors will have difficulty sourcing it elsewhere. However, this move usually requires you to increase your minimum order because you are, in a way, limiting the business of your supplier.
Master Your Turf
If you are an amateur basketball player, will you play one-on-one against NBA superstar LeBron James? The same is very true in business. Yes, your expertise can be a very intimidating barrier against new players. It means you have to work closely with employees, run things more efficiently, and maintain stronger ties with your key customers.
Pimp Your Ride
If your business relies heavily on technology, you should allot money to upgrade your systems regularly and acquire cutting edge technologies to further improve your business operations. If you want to see this strategy in action, you might want to observe the mobile phone sector wherein new products are released every few months.
