New competitor affecting my business

[futureworry]

Three years ago I left my job to follow my passion and set up a business. I put a huge amount of work into it and have been very fortunate in that I'm the only person who does what I do in the local area - and business has been good to great since I started.

However, six months ago somebody else set up a very similar operation - with a very similar offering to what I do - near to where I'm based. Since that happened my takings have been down quite significantly, which I suspect is due in part to this new person opening up.

I know from conversations with my customers that many of them are now spending money with my competitor as well as me and they seem to be building a strong following. No doubt I've lost customers to them as well.

Of course other people are perfectly within their rights to set up a business wherever they want, and I know I've been extremely lucky not to have any close competitors for the past three years.

But the issue is, now that it's happened I can't stop worrying that my takings are down - and worst case scenario that I'll have to close and give up my passion.

Do any business owners out there have any tips on how to handle competition in business, stay focused, not panic and most importantly, stay positive?

Undercut them. Guaranteed win win

Not always, you might end up killing the market if you go to low, and reducing your margin.
We are clear that we don’t compete on price, but offer a reliable, quality, we’ll recommended service. We also spend money on local advertising as well as social media campaigns.

Can you give us an idea of what your business is like, ie are you selling a service or a physical product, do you have your own premises etc?

This, we can help

OP I do think if you give an inclination to what you do you might get some very very good help here. I work within consultancy, but without knowing what it is you do, it’s just the same old obvious dribble that we can advise you to better.

You will just have to accept you now have competition and will have to work harder to earn a living.

You're right. It's daunting as I work long hours as it is (and am due a baby next year!) so the timing isn't ideal. I have been feeling quite upset and worried about it but I know that wallowing won't help anything. I have to just pull myself together and roll up my sleeves!

Yes, I'd say the design of their adverts is prettier than mine for one thing, and their marketing is much slicker in general. I'm good on social media but not that good on the visuals (I know some businesses are brilliant at it).

I'm not sure I want to disclose exactly what it is I do - I'm worried about it being outing. Sorry to be vague...

What do you use to create your imagery? I'm sure it would be easy enough to overhaul your posts/images yourself and then perhaps spend a little on targeted FB advertising and so on?

Perhaps invest in paying someone to design your advertising/website for you. A discount voucher or code for returning customers?

Give us a vague clue. Tell us what it is similar to? Beauty treatments? Massage? Cake making.

Offer a special deal/offer? On our local Facebook group, One cleaner offered a 'spring clean for £50 instead of £70. For that month only. She was inundated with customers.

Are there products/services better or are they better at marketing?

How much demand is there for your service?
What can you do to get repeat customers?
Is there enough work for both of you?
Remember - if you go low on your prices, it's very hard to raise them if you find it unsustainable.

It’s very very easy to make your visuals better OP!

An apple app ‘WordSwag’ you will be able to make lovely little advertisements with them, with your own logo on to. Write a list of what they do, what you do, and where there needs to be improvements made, not to be like them but to better them. Get a friend to buy something off them and share the ins and outs of the experience.

If you do your own marketing, theirs might be slicker because they are using an agency/freelancer. If you are already using someone else to help with this, you might want to consider a change or at least brief them differently and see how they respond. If you do that kind of thing yourself and are concerned about the quality of your images, you might want to do a course - many floristry schools for example, run instagram for florists courses. See what is out there. I guess it depends what your product/service is but I wouldn’t want to devalue my services by cutting prices. And make sure you are consistent with your pricing - customers will chat amongst themselves as to who paid what. Good luck!

Why are your customers moving to your competitor? Find out why they're leaving you and work on improvements, whether it's your opening hours, your prices, your service, or whatever. There's a reason they're choosing your competitor over you - understand why and deal with it.

Im sorry if it’s already been mentioned and I’ve missed it, but could you offer your services on Groupon or similar?
I work for a small family
Run pharmacy and we are constantly trying to keep our customers, the big chains have money to spend on fancy signage etc, we work really hard on our customer service to keep our loyal customers but it is a constant battle to survive. Best of luck.

Undercut them. Guaranteed win win

That is just about the worst suggestion. Just causes a race to the bottom. Please don't do that.

Im guessing microblading or lash extensions? That kinda thing @futureworry ? Ir is it more product based than services?

There is often EU funded support out there for SMEs...

Your local enterprise partnership may do as well.

Basically see if there is any "local" support out there for you.

Avoid Groupon. The last vestige of crap products and failing businesses. They are apparently trouble to negotiate with, then you have to deal with piles of unsatisfied customers who didn't read the T&Cs.

Is it something that in the run up to Christmas you will normally be very busy if so maybe do some advertising for this now
Are you on FB IG Twitter
If your worried now the next 6 weeks are traditionally the busiest of the year then Jan Feb tend to go quiet for most business so you need to think about it quickly
My beautician is always on IG / FB and regularly
Offer special prices on different treatment inc Botox and Eyelashes

instagram.com/nobullschool?igshid=g3wcz87vzyr8

This is a great instagram all about business, might give you some ideas.

Thanks for the additional advice. It seems so easy when everything’s plain sailing doesn’t it? But as soon as there’s a bump in the road I crumble. So disappointed in myself.

Keep on doing what you are doing and keep doing it well.
The other business is probably worried about you.

Is there enough room for both of you?

Realistically I think there is room for both as things are, though my profits will be significantly lower - so I’ll keep a roof over my head but might struggle to take a holiday next year, for example. Which isn’t the end of the world but it is a bit of a shame!

Let me guess - you have a Cricut (or a Silhouette). Everyone who gets one of these thinks they have a business now.

ONe thing the company I work for do, is in a busy period every parcel sent out goes with a voucher to be spent in the next quiet period. Meaning we end up almost as busy when it should be quiet. (we sell a fair bit of seasonal stuff).Almost all our products are widely available in bigger places like Amazon at a similar price, but we do a lot of Instagram etc targeting which brings in a lot of customers. We are very hot on customer service, instant replies etc

Sometimes the voucher is targeted to a specific product or range of products, so it doesn't appeal to all customers because they might not buy the offer - but you can guarantee a fair proportion of them (we can see who) try the voucher code in the box when they come back to shop, just in case it takes a ££ off their usual order!

Let me guess - you have a Cricut (or a Silhouette).

@MidniteScribbler a what? I’ve never heard of either of those things