04/ 02/ 2002
Most small business owners go to great lengths to keep information about their inner operations and plans hidden from competitors. In most instances this is probably a good idea. Why share your hard-earned experience with others who would then use it to take customers away from you? There are situations, however, in which other companies in your industry aren't really direct competitors and might be interested in sharing valuable information. In today's Workshop, Jeffrey Moses discusses how your business can benefit from opening a dialogue with these "non-competitive competitors."
If your company provides a service, distributes a line of products or sells retail, it's quite likely that your customers are located within a general geographic area. This area may be a specific section of a city, an entire city or a wider area that may include an entire state or several states. In any of these cases, businesses that are similar to yours but operating outside of this immediate geographic area are, for all practical purposes, not in direct competition with you.
If you own a particular type of store in any large U.S. city, for instance, there may be a dozen or more stores in the city that sell the same basic product lines. But stores that are ten or twelve miles from you sell to an entirely different population of customers and as a result can't be considered direct competitors. Before making contact, however, be sure that your non-competitive competitor is not affiliated with a division of a business that is located near you. In this case, any information you share about how you have handled situations could be transferred to your immediate competitors.
The owners of these stores, however, have probably encountered many of the same problems that you have: difficulty in getting financing, returns of specific items, lulls in business during certain times of the years, difficulties with high advertising costs, etc. Because these stores aren't in direct competition with you, their owners might be open to meeting with you to share ideas about how they handled these problems. No one has all the answers to the various difficulties a growing business faces, and putting together a mini "brain trust" can be valuable for every person involved.
To initiate the getting-together process, first do some research to locate non-competitive competitors. Then call one or more of the owners and, in a very straightforward way, ask if they would be interested in getting together to discuss mutual problems. At first these people may be surprised by your call, but when they realize that you are not a direct competitor, it's probable that an initial meeting can be arranged. They may benefit just as much as you.
Be sure to put together a list of items to discuss during the meeting. This will help keep everyone focused and make the best use of the time spent. Items to talk about could include (depending on the type of business):
- Marketing strategies and costs
- Employee salaries
- Attracting, hiring and keeping good employees
- New developments and trends in the industry
- Equipment used in the industry
- Billing and hourly rates (if a service is provided)
- Tax-related items
- Financing Seasonal fluctuations and how to handle them
- Best selling and worst selling items
