7 Critical Success Factors that will Make Your SME Stand Out
Small to medium enterprises (SMEs) constitute the vast majority of businesses in Singapore. They continue to generate substantial income in this economy; they make up 99% of all enterprises. SMEs contribute about S$196 billion to the Singaporean economy. These statistics clearly show that these enterprises will always be the backbone of Singapore.
Though SMEs are major players in the economy, they face challenges that derail their progress. Such challenges include limited access to finance, enormous costs and competition from large corporations. Despite these challenges, SMEs continue to increase in numbers. What can make your enterprise stand out from the crowd?
An essential ingredient to outstanding business performance is to have a competitive advantage. Competitive advantage means to stay ahead of the competition. It is defined by a set of features which your customers perceive as superior to the competition. You should formulate ways to create an edge to outshine your competitors.
You can achieve this goal by evaluating your competitors’ strengths, and weaknesses then try to fill the gap. Here are the success factors to give you a competitive advantage and distinguish your SME from the rest.
1. Attractive Product Cost
You can place yourself ahead of the competition by low pricing. Two companies that have been empowered by this strategy are Amazon and Walmart. It can also work out for an SME, what it requires is a well-laid down strategy. Low pricing will not happen from a vacuum. You can keep costs minimum in many different ways. You can utilize your workforce cost-effectively, buy inexpensive raw materials and control costs in all other areas.
What you should ensure is to create efficient operations that maximize value to customers. You can reduce the extras you offer to your customers. For instance, you can be a poultry farm that supplies chicken to hotels and restaurants. As you sell chicken, you could be giving a dozen eggs for every hundred supply of chicken as an incentive. You can remove this incentive to add more stock and sell a chicken at a lower price.
There are other ways of cutting down cost; it mostly depends on your industry. Technology industries can use product design to cut cost. Product re-engineering can also be used to reduce cost by redesigning products and creating improvements. Others can use a new delivery method that is cheap and realizes significant costs savings.
2. Product Differentiation
Product differentiation is when your product or service has a unique offering to customers. Your differentiation method should look to make products more attractive and with superior qualities. It can be merely designing a new advertisement campaign or packaging products creatively. It should make customers perceive your products as unique or superior.
Differentiation should elevate your products high above others, and it is this feature that will draw customers interest. It ideally alters customer perception that a product exceeds the performance of a competitor product. Product differentiation demonstrates additional features like additional quality or features.
3. Innovativeness
Innovativeness is the ability to generate new ideas to improve processes, bring improved products to the market. Your innovativeness should consider bringing efficiency and growing profits. Many companies stand out in the market by doing things in new and different ways. Uber, for instance, continues to gain recognition because of offering tax services using an app.
This Uber app has created efficiency to both the rider and the driver. Uber has gained a competitive edge over other tax service offerings. Their app enables them to secure big business hence their ability to reduce the cost of riding. You can gain a competitive advantage when you discover new ways of doing things. Innovation can help your business in several ways.
4. Unique and Effective Operations
You can gain a competitive advantage by doing things better than others. Particularly if you are in the service industry, your mode of operation can help you stand out. A service company like Singtel, a mobile network firm can stand out by simplifying and streamlining its processes. With constantly evolving business world dozens of tools are available to make work easier.
Today’s customers are seeking efficient time operations and giving this offering will help you win a competitive edge. You can use your customers’ feedback or even study your competitor’s weak points and build on them. Old habits can also become monotonous to customers. Replacing them with new improved methods can take your business a step ahead of the competition.
5. Adaptability to Market Changes
Today’s market environment is quite unpredictable due to the effects of technology. Technology is advancing at a high rate making market status highly volatile. You can find that today a product is highly acceptable, but tomorrow it’s out of fashion. It is up to you to know how to negotiate the waves of change. You can sail through with your product by making an appropriate adjustment every time there is a market change.
You can achieve adaptability by first and foremost developing a state of mind that embraces change. Openness to change will help you deploy strategies that bring adaptability like training. Training your workforce will bring new skills to the table, and you are well positioned to fulfill customer desires as they change.
6. Information Strategy
You need to take the initiative to gain knowledge and information. Competitiveness comes from the possession of skills that outpace your rivals. In fact, all other factors benefit from excellent information. Information technology is making things easier for businesses. For instance, companies are becoming smarter by using data analytics to their advantage. Analytics drive to relevant insights that help companies to create value.
You can evaluate customer responses and reaction from your company website and use this data to adjust product accordingly. Customers will remain attracted to you because you can offer what satisfies their need.
7. Embracing Technology
Another way of seeking a competitive edge is using technology. You can bring in new technology or use technology in a new way. Applications continue to offer businesses advantage over the competition. You can utilize available technology in a way to improve customer experience. Recently, mobile apps are on the rise to bring services closer to customers.
Customers do not need to travel to buy a product or a service. They can access them from the comfort of their phones. Customers are ever seeking out services and support from their mobile phones. The better you provide these mobile-based services, the better you stand out of the competition.
All the above factors gear towards excellent customer service. For your business to thrive, you must look for ways to impact high sales. High sales are only achievable when you have a good base of loyal customers. Your business positioning in the market is what attracts customers. Embrace those factors that are relevant to your business, and you will secure a competitive advantage in the market.
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(By Racheal Muriithi)
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