5 reasons why you should have a relationship with your competitors
Competitors are not the enemy
Most people in the business world see competitors as the enemy, and their representatives as people to avoid. We think the opposite is true! There are so many benefits to having a relationship with your competitors. As a business matchmaking platform we know the value of business connections of all kinds—including those with the competition.
B2BeeMatch allows businesses to connect with each other to find the B2B services they need to keep their businesses running at their highest potential. Usually this means being matched with businesses that have totally different offerings (such as a marketing firm seeking financial services or vice versa) but what about relationships with those with similar offerings? In this article we explore the benefits that can come from developing a relationship with a business within the same industry. While a natural tension certainly exists between businesses that are offering similar products or services, we want to encourage our members to look at how this tension can ultimately benefit all parties. Relationships with similar or competing companies don’t need to be awkward or strained. In fact, they can actually offer relief in challenging times and help businesses strengthen each other.
Let’s take a look at five reasons you should have a relationship with your competitors!
Reason #1: Networking is key
It should come as no surprise that we put networking as the number-one reason to have a relationship with your competitors! In the small business world, network is key. This is common knowledge, but how do we balance it against the concern that your direct competitor may be after your slice of the pie? We recommend focusing on the possible gains rather than any fear of losses. If you avoid networking with people in your field, you may miss out on opportunities—for instance, a job they have to pass on, a new product being rolled out, or the latest news on a big development.
Having a relationship with competitors gives you access to business insights and industry information
If you instead choose to initiate contact and build a relationship with competitors, you will be more likely to learn of upcoming events and get business insights to which you would otherwise not have access. Discussions about your customer base, products and the markets you are operating in are full of valuable information. When you consider all that you may be missing out on, you can see how the approach of isolating yourself from your competitors has the potential to do more harm than good. While certain things will always be inappropriate to share or ask about in business relationships with your competitors (such as financial details or sensitive product development information), focus instead on what you are able to offer to your network and watch the benefits flow in.
Reason #2: Differentiate yourself within the industry
Another reason to develop good relationships with your competitors is that they can be amazing resources for industry insights that can help you differentiate yourself and set yourself up for greater success. In a world where we increasingly see the benefit in catering to a particular niche, it’s highly likely that your closest competitors are catering to a slightly different market than yours, whether that’s geographical or simply about a nuance in their product or service design. Beyond the core product or service that your business is selling, your easy-to-use online tools or unique customer service strategy could be what sets you apart. Getting to know competitors better will help you distinguish your offerings so that you can best capture the slice of the market you’re really after.
Talking with your competitors will give you valuable insight into marketing yourself effectively.
Your competitors will have their own keen insights and knowledge of your field. Instead of being intimidated by this, we encourage our members to be confident in their own vision and to build relationships with competitors to help them better understand their place in their industry along with places for growth. Understanding how competitors see their place in your industry can help shape your own strategy and think of things in new ways to serve the needs of potential customers. Differentiating yourself is linked to greater success.
Reason #3: You have a lot in common with your industry competitors
While differentiating yourself is important, sometimes your competitor’s leaders are the people who are best placed to understand your struggles and challenges as a small business leader yourself. Maintaining a friendly professional relationship can be a positive experience and give you both an opportunity for advice, support, or even just a bit of commiseration over drinks once or twice a year. You don’t need to deprive yourself of a beneficial relationship just because you are selling the same thing.
The challenges of being an entrepreneur are numerous and can be exhausting! Having relationships with people who understand what you’re going through and the particular problems you’re working to solve can help you stay healthier and more able to take on these challenges. Exploring what is going well and what pressures exist will offer valuable insight for both of your companies. The reality is that there is more to be gained from sharing knowledge than from keeping secrets. Offering a helpful piece of information to a competing business helps to build trust between you, and more often than not, those you build relationships with will reciprocate in good faith.
Reason #4: You can outsource to a company you trust
Having relationships with your competitors offers many business opportunities
Rapid growth is exciting for small businesses. However, scaling presents many challenges. If your business is suddenly offered a lucrative contract but you don’t have enough resources to carry it out, your competitors may be your best choice for one-time collaboration or outsourcing. Having established relationships with competitors will put you in a better place to know who to ask for support, and the baseline trust developed will help keep your mind at ease as your business takes on new and exciting opportunities.
Being friendly with the competition also means your business may be their top choice if they ever find themselves in the same position. This presents another win-win situation for you and you and competing companies. If you collaborate with a competitor on a large contract, you are able to expand both your customer bases and ensure that the work is carried out by the set deadline to ensure customer satisfaction. Reliable products and services will create more customer loyalty for you both. So remember to help each other out when possible!
Reason #5: It’s good for your industry overall
As mentioned above, getting to know your competition helps you to differentiate yourself within the industry. When you do that, you’re expanding the types of services or products that exist on the market and can meet the needs of a larger portion of the potential customer base. A larger variety of services or products within an industry can help customers see the benefit of your business’s offerings and can benefit market development overall. As the market grows and you further differentiate your company, companies you once considered direct competitors may become more indirect competitors.
So while the traditional view of competition as the enemy may be rooted in real concerns, viewing competitors instead as allies in the growth of an industry creates the potential for more success for everyone. Let’s think of relationships with the competition as something that creates a bigger pie to share rather than an opportunity for your competitors to steal your slice.
Start building relationships with your competitors today
In short, there are many great reasons to build good relationships, whether distant or close, with your competition. Through getting to know your competitors, you’ll get opportunities that would not otherwise be possible. You’ll be better able to differentiate yourself from others and use this differentiation in your marketing strategies. Relationships with competitors could help you get through a tough spot when scaling your business, and they could also send business your way. Through them, you’ll learn about the latest in your market and what your customer base is asking for to make sure that your current services and products are aligned with the newest demands. In short, putting the “friendly” in “friendly competition” is good for everyone!
How can my business build relationships with my competitors?
We encourage you to reach out to your competition, direct and indirect competitors alike, to build real relationships. Start off slowly by introducing yourself and your business. Take care not to ask too many sensitive questions before establishing a professional relationship. Try not to worry too much about who has the competitive advantage and instead offer what you can in terms of information and opportunities. If a particular competing business never reciprocates, simply focus your attention elsewhere.
Joining a network of business like B2BeeMatch is an efficient solution to develop relationships in your industry
The business world is intense but it doesn’t have to be cutthroat—we can all succeed better when we have each other’s backs.