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How to beat cut-throat competition

Sasha Karen
02 March 2017 3 minute readShare
blue boxing gloves punching red boxing glove beat cut throat competition

Every business has competition, and every business owner has his own tactics on standing out, head and shoulders, above the rest. Here’s how some of the best beat the rest.

1. Surviving in a saturated market

Trying to break into a well-established market is a difficult task — but not an impossible one.

Gyms are a business that customers will visit out of sheer loyalty, and have been around for a long time, so trying to break new ground in an established market is a difficult task.

This was a task that Justin McDonell faced when he first introduced the Anytime Fitness brand into Australia from 2008. 

“We had a target in our development schedule to reach 300 locations,” says Justin.

One boxing glove punching back against many boxing glovesAnytime Fitness’ closest competitor, Fitness First, at the time had approximately 95 locations, indicating the size of the challenge laying ahead of him.

Justin says he remained convinced his plans were viable, although there was uncertainty that this could even be achieved.

“We weren't sure if we could do that. No one had ever really done that.”

Jetts was another gym franchise brand that posed a real threat to Anytime Fitness’ growth plans. It had approximately 10 to 15 locations open at the time Anytime Fitness entered the market, with similarly ambitious growth plans.

“We were just so determined to get in front of them and beat them,” Justin says.

In order to keep growth going and attract franchisees, Justin had to stand by his idea and prove it was sustainable.

“People would say, ‘Why do you want to go to the gym 24 hours a day? It won't work in here’,” he recounts.

“We ignored all those people and just kept growing.”

It may seem like a simple thing, but simply believing in the concept, coupled with hard work, is key to helping Justin surpass his competitors, and become the largest gym franchise in Australia with over 450 locations.

“I think [Jetts are] sitting on about 250 locations now, so we've kind of smashed their targets,” he says.

“That was a real driving force in the early days, to get bigger and better than them.”

Despite continuously growing, Justin is not planning to rest on his laurels any time soon, with plans to propel Anytime Fitness to over 500 locations nationally.

This comes against a backdrop of a number of competing chains, such as Fitness First, Jetts and GoodLife, having been bought out by Quadrant Private Equity, with further growth planned.

“Their reports predict there'll be still growth year-on-year, about 6.5 per cent,” Justin says. While this does stand as a threat to Anytime Fitness, the outlook for the gym industry is looking prosperous all round, Anytime Fitness included. 

2. Taking on big business

Big businesses may seem untouchable, but there are plenty of benefits to being a smaller operator competing against such players.

This is how John Sammut has taken his nearly 50-year-old garden centre business, Flower Power, and pitted it against corporate giants Masters Home Improvement and Bunnings.

According to John, there are several key factors to address when competing against the likes of a big corporate:

  • Own your niche: “What we’re looking to do is to be the specialist garden retailer, where we have the largest range of plants available. It’s the main part of our business and the main reason why people come shopping at our business.”
  • If you can, take full control of your product vertical: “We have about 5 million plants on the ground at any one time. That gives us the opportunity to be price-competitive – we can be competitive with Bunnings and also make a good margin on the product.”
  • Reduce the supply chain by importing goods in-house: “Most of the outdoor furniture, tools, wheelbarrows, any type of homewares-type product, we import directly ourselves, so we can sell that at a competitive price and still make a reasonable margin on the product as well.”

3. Don't lose sight of the end goal

While some business owners value observing what competitors are doing, others would rather focus on developing their own product offerings for the sake of the customer, like Kenny Graham, co-owner of burger restaurant Mary's.

“In one avenue, I just feel that I don't really care what anyone else is doing,” Kenny says.

“You have to be really focused and sure about the product that you're trying to sell, and that it's relevant, and that it's priced well, and that it's attractive, and it's exciting for people.”

If you get wrapped up in the competition, Kenny warns, you can forget what is most important – your customer.

“It's not always about being the biggest burger or the cheapest burger, or the so-called 'best burger'; it's about the experience of the customer coming into your store with the consistency that you always get the same level of treatment and product,” he says.

“Just concentrate on yourself and be creative and keep coming up with new ideas.”

To ignore competition in order to focus on the customer experience may seem a drastic view at first, but it is one shared by others, such as Clare Long, principal of Norgay HR Consulting.

She takes it a step further and instead of competing, collaborates with other consultants.

“This is a big market, there's enough room for everybody to play in. I would rather collaborate with [my peers]. If I don't have a piece of the puzzle to deliver to my client, I'm very comfortable collaborating with another consultant who does,” she says.

How to beat cut-throat competition
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Sasha Karen

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