One of the best strategies you can implement as a business is competitor monitoring. Analysing those in your industry and knowing where you stand in comparison to them will give you a real insight into how you can improve your own business. You may have come across the terms industry benchmarking and SWOT analysis, but it’s vital that you understand what they are and how you can use them to your advantage. In this article, we’ll share how you can use these business tools to stay one step ahead of your competitors.
The term is thrown around a lot, but what is industry benchmarking and what does it mean for your business? Industry benchmarking involves looking at your business processes and performance against those of your competitors. Benchmarking is an invaluable tool for your business in the long-term, as it can be used to discover necessary improvements across your business – this will help you stand out among the competition.
But, how do you identify and work on areas of your business for improvement? This is where a SWOT analysis is needed.
What is a SWOT Analysis?
A SWOT analysis is a popular technique used to identify a business’ strengths and weaknesses and analyse the opportunities and threats you face from your competitors. The SWOT framework was devised by Albert Humphrey at the Stanford Research Institute in the 1960s and is one of the most widely-used marketing techniques in the world today. The reason it has remained a popular business model for decades is because of its simplicity and effectiveness.
How to create a SWOT Analysis
Firstly, you should identify what your objective is for carrying out the SWOT analysis. Do you want to improve your processes or introduce a new product or service? Or are you struggling to stand out from the crowd? Following this, you should research your industry to find out more about your competitors. Look at what they do well and what areas they are weak in.
Start by creating a SWOT analysis for your own business using these steps;
- List your strengths: Begin by listing all of your business’s strengths. What do you do particularly well? For example, you might have excellent customer service, popular products, or have a strong position in the industry financially. Write down everything you can think of no matter how big or small – you will use this later for analysis.
- List your weaknesses: Make a list of everything that you think is a weakness for your business. Weaknesses could include small market share, lack of new products or even the location of your business. Perhaps your social media presence is weak in comparison to your competitors, or you’re not on all the online channels that perhaps you should be.
- Identify business opportunities: Business opportunities could be anything from the possibility to introduce a new product, to investing in new technology. Opportunities can be something that could put your business in a stronger position in the future.
- Identify business threats: Next, you need to consider external factors that could threaten your business. For example, increased competition, high interest rates and a global pandemic are all significant threats, alongside future market trends.
Identify the key points from your SWOT Analysis
Once you have the above information about your own business, list your competitors and ask the same questions about each of them. Then, cross-reference the analysis from your own business compared to theirs – this will help you to discover further opportunities for your own business, and threats to take advantage of.
A SWOT analysis will aid you in your industry benchmarking, enabling you to measure your objectives and performance. By conducting a SWOT analysis, you can develop strategies for achieving your business goals which will ultimately lead to business growth and the competitive advantage.