Paul Wheeler is the Sales Director for MHK UK, a cooperative of specialist kitchen retail businesses in the United Kingdom.
How businesses can gain a competitive advantage
Posted 26th Oct 2019
We often speak about gaining a competitive advantage for our businesses, but what does that mean? The dictionary definition is “a condition or circumstance that puts a company in a favourable or superior business position,” but what exactly puts you in that preferred position?
I believe it’s easy. You simply need to meet your customer’s needs in a different way than your competition. You have to be unique!
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To strategically plan this uniqueness, you need to know your competition and your customer, identify their expectations and tailor your offer to them.In terms of your competition, it is essential that you understand their offering and analyse their strengths and weaknesses.
Do you know what their product can’t do but yours can? Do they put more detail into drawings? Do they offer evening appointments? Sometimes it is the little things that can make the difference between a sale and a no-sale.
In terms of customers, the most useful thing is not to analyse the kitchens that you have sold, but to analyse the kitchens you didn’t sell.
After all is said, this is a marginal business and once your overheads are covered, every additional kitchen sold makes a direct contribution to your bottom line profit as a business owner. Even selling one extra kitchen per quarter can massively increase profits.
Getting this information therefore is crucial and it could be as simple as making a phone call but could also be a well-worded email or letter with a feedback form. The answers you receive could tell you your customers are looking for a different specification of product, at a different price point. It could also be service related, or it could be purely price driven.
Overwhelming information and the question of how to use it for a successful business plan can lead to an overload. This is where a buying group like MHK can help.
MHK is an innovative and dynamically expanding full-service company for specialised kitchen trade and has detailed knowledge of the whole kitchen marketplace and the USP’s of each brand.
We can help analyse the immediate competition and target groups in order to find new opportunities and markets to grow specialist kitchen businesses, whether it be the introduction of a product staircase of good better and best, or ensuring the best purchasing conditions with their industry partners.
We also ensure that members can trade in a cashflow positive environment due to the 30 day payment terms, still with early settlement, and a rebate at the end of each year. Just a 1% improvement in terms increases profitability by 8.5%.
There is no shortcut to immediately gain a competitive advantage, but through a series of strategies, it is possible to manoeuvre a business and make subtle changes to help sell that additional kitchen each quarter or even month, allowing members benefit from an increased revenue, in addition to the best purchasing terms on their core business, therefore increasing profits.
Every retailer can do this, but why do it alone? We are stronger together!