Why is competition good?

Many entrepreneurs dislike their competitors because they take away some of their customers and therefore their profits. They think that the less competition they have, the better their business will do. Also, those who just want to start a business try to find a niche with little competition. They think this will make it easier for them to survive and establish themselves in the market. In reality, this is a misconception. In a new blog post from LLC «ElectraQuix», we talk about why competition is the key to success.

Where there is competition, there is demand
Demand creates supply. This well-known expression accurately describes the market situation. There is no niche in consumer goods where there is truly high demand and virtually no competition. Such niches are the exception to the rule, they are highly specialised and designed for customers with specific needs.

Competition always indicates that there is high demand in the niche. If you enter it, you can take a bite out of that pie. For example, a customer may go to your competitor but be dissatisfied with the price, quality of packaging, delivery time or some other factor. And you can draw that potential customer to you because of your competitive advantages. The key is to create those advantages. It will take a lot of effort and money, but if you do it right, the investment will pay off.

No need to create demand
The second factor is a logical consequence of the first: if there is competition, there is no need to create demand for the goods. It already exists.

Entrepreneurs, especially beginners, have an idea to create or market a unique product. They think they can make a lot of money from it. But this is a misconception. You cannot make conclusions based on your preferences and ideas of what customers need. This is because the vast majority of people buy what they know: products from trusted brands that are constantly being talked about. Buying something new and unknown is a risk because there is no established demand, no reviews, no testimonials, etc.

So offering something new or unique is a big challenge. Even if it's a product with cool features, people will be wary of it and are likely to pass on it. You will have to create your own demand, and that means investing a lot of money in advertising, promotion and other marketing tools. If you don't have the experience and skills to do this, then try selling the products of the brands that people know. Yes, you will not be unique and you will be competing with many companies selling the same products. You can win this competition through marketing, service, after-sales service, etc.

Competition keeps you going

Competition prevents an entrepreneur from relaxing. You cannot start your business and drift away because the competition will eat you up. Therefore, it is necessary to keep yourself constantly energised. You should be constantly working on the development of your business and the factors that will make customers choose you over another company offering the same or similar products. Competition is the engine of professional growth. You should not be afraid of it, but use it to achieve success.