In every strategic plan there should be a comprehensive section on risk analysis.
This is the section where you consider all the things that can go wrong and develop your contingency plans for how you will respond.
What can you do to reduce the risks of disaster or prevent the worst from happening? How can protect yourself as much as possible in the worst-case scenario? The risks are probably not all predictable; some may be inevitable and unavoidable. The actions of your competitors are among those risks that are not under your control, but which may significantly impact your business unfavourably, even fatally.
I recommend that you consider two kinds of risks: Internal risks which you can manage, and external risks which you cannot.
Internal risks like business interruption, legal liabilities, confidentiality, conflict of interest, and theft of assets or intellectual property can be managed by due diligence in insurance coverage, security systems, solid commercial contracts, and well-documented corporate policies and procedures.
External risks like natural disasters, fluctuating interest and exchange rates, changing political and economic conditions, and the evolving trends in your market sector with rising customer expectations and the response of new competitors cannot be managed.
However, you can keep your head up, your eyes on the horizon, and assess what’s brewing for your future. Learn from your competitors – what’s working for them that might work for you. Let them test the market response to their solutions and take the early slings and arrows before you follow too closely into the battle for market share.
Maybe you can be more creative, more flexible. The leader, not the follower.
Be better. Do Better. Be an Enlightened Entrepreneur.
Del Chatterson, your Uncle Ralph
Learn more about Enlightened Entrepreneurship at: LearningEntrepreneurship.com
Read more of Uncle Ralph's advice for Entrepreneurs in Don't Do It the Hard Way & The Complete Do-It-Yourself Guide to Business Plans - 2020 Editions.
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