Competitive Analysis

Competitive Analysis

Who are the competitors? Where are they? What are their strengths, and weakness? Make a list of each competitor in your trade area for each segment of your business. List the strengths, and weaknesses on a chart so that you can compare the products, and services offered. Write a brief description of each competitor's strengths, and weaknesses.

Gathering information on your competitors is bit difficult, and time consuming. Be bold, and talk to the businesses managers, most are pleased to have someone to talk to who is interested in what they do. You will learn a lot in the process, and anyone reading your business plan will know that you have done your homework.

Every time that I have walked into a competitor, and introduced myself, the person who happens to be accompanying me has been amazed at how accommodating, and open the business owners, or mangers where. Be bold it is a mind expanding experience.

Some years ago, I had applied for a bank credit line, I took my banker to lunch and on the way back to drop him off, I stopped to visit a competitor, he was amazed at the reception we got, and the resulting tour of the business's operation, I got the loan.

Business Plan Example.

There is only one other Barbecue restaurant with in 7 miles, it is located in Sinton, Texas and it is not located on the main highway. The establishment serves mostly local business as it is hard for non-locals to find the place being on a side street. They serve plate lunches, Barbecue by the pound and offer catering service and custom cooking. The food is good and the owner says he is ready to retire and would sell out. He does not do much catering any more as it is to much work with running the restaurant and all.

Our more direct competitors will be the food establishments in town, each of which offers different fare. There are two Mexican restaurants, one dairy queen, one cafe, and two hamburger restaurants. Based on our license plate survey and conversations with the managers, the cafe and the Mexican restaurants have more customers for breakfast then the fast foods establishments do, the fast foods places do better at lunch, and in the evening the patrons are pretty evenly divided with the Mexican restaurants doing the least. Most of our business will be at lunch and in the evening, with to go orders making up a third of business at noon and half of the sales between 5pm and 6pm.

We will be the only restaurants serving Barbecue with the exception of a once a month Barbecue offering at the cafe and chopped Barbecue sandwich offered at the dairy queen. We will have the only Barbecue to go and fried chicken to go in our trade area. Our average ticket is comparable to the other sit down restaurants.

There are two other establishments offering catering in our trade area. Neither has a restaurant to draw customers from and must advertise their offerings. One of the people has a deal with the cafe to use their kitchen and the other rents a churche's kitchen. As needed, both offer a wide range of fare but not Barbecue. We will stand out as the only barbecue offering and the only establishment with equipment designed to serve hot food to as many as 600 people and still serve the last person hot food indoors or out.

Note: I would include here a comparison chart, comparing your establishment to the competition, average customer check, and other pertinent data, such as drive up window, services offered, years in business, number of employees etc.