This post originally appeared on Entrepreneur.com - #StartingABusiness
This first section defines your company and its products or services then shows how the benefits you provide set you apart from your competition. It’s called a “situation analysis.”
Target audiences have become extremely specialized and segmented. No matter your industry, from restaurants to professional services to retail clothing stores, positioning your product or service competitively requires an understanding of your niche market. Not only do you need to be able to describe what you market, but you must also have a clear understanding of what your competitors are offering and be able to show how your product or service provides a better value.
Make your situation analysis a succinct overview of your company’s strengths, weaknesses, opportunities and threats. Strengths and weaknesses refer to characteristics that exist within your business, while opportunities and threats refer to outside factors. To determine your company’s strengths, consider the ways that its products are superior to others, or if your service is more comprehensive, for example. What do you offer that gives your business a competitive advantage? Weaknesses, on the other hand, can be anything from operating in a highly-saturated market to lack of experienced staff members.
Next, describe any external opportunities you can capitalize on, such as an expanding market for your product. Don’t forget to include any external threats to your company’s ability to gain market share so that succeeding sections of your plan can detail the ways you’ll overcome those threats.
Positioning your product involves two steps. First, you need to analyze your product’s features and decide how they distinguish your product from its competitors. Second, decide what type of buyer is most likely to purchase your product. What are you selling? Convenience? Quality? Discount pricing? You can’t offer it all. Knowing what your customers want helps you decide what to offer, and that brings us to the next section of your plan.
