Opinions expressed by entrepreneur the collaborators are their own.
If your exit strategy is to grow your business until it can be acquired by a larger company, you can’t play it safe. A secure, conservative business with predictable revenue and slow growth is not attractive to most large organizations. They want to acquire companies that are different and distinct. You can position your business in this light by establishing a clear competitive advantage.
It is impossible for someone outside your organization to tell you exactly how to establish a competitive advantage (after all, if everyone could see the opportunity, your other competitors would have done so by now). Instead, I will give you some specific examples of different definite ways in which you can create an advantage. Use them to start thinking creatively about applications for your business:
1. Niche down
The first and most obvious option is to target a specific part of the market. By scaling up, you can turn your business into a core resource for XYZ, not just another option among countless products and services.
Let’s say, for example, that your business produces and sells water bottles. If you try to go to the market selling water bottles to anyone, it will be difficult for you to stand out. However, if you market your water bottles as water bottles for construction workers who want something extremely durable that keeps the water cold at high temperatures, you have a much better chance of creating a competitive advantage.
Related: How downward niche gives you the strength to dominate your market
2. Develop a USP
Your business needs USP, which means a unique offer to sell. This is a one-sentence phrase that explains exactly what makes your business unique and fascinating.
There are dozens of different ways to come up with USP, but here’s a good formula: “We help [NICHE] achieved [DESIRE] without [PAIN]”Using the example of a water bottle above, a good USP would be:” We design water bottles for construction workers who keep the water ice cold even at 90-100 degrees, so you never run out of energy. “
As you can see, there is enough room for flexibility. The key is to call for a specific niche, to mention a desire that your product / service helps them achieve, and to highlight a sore point that your product / service helps them avoid.
3. Create a unique mechanism
One thing that can really help is identify a unique mechanism that allows your technology or process to look unique and your own.
This is something that the Schlitz Brewing company did in the 1920s. Legendary advertiser Claude Hopkins was walking around the facility once when he saw the extensive process they used to purify their beer. He was amazed – so much so that he asked the owners why they never share this process in their marketing. Their answer: “Every beer producer in the industry does it the same way.” But Hopkins’ point was that no one had ever told this story before, which meant that customers in the market had no idea how extensive the beer refining process was. Following a new marketing campaign focusing on all steps of purification, Schlitz rose from the fifth beer in the United States to the first ranked beer in 60 days.
What is your unique mechanism? What process, technology or unique approach do you use? Even if everyone else is doing something similar, you can establish a competitive advantage by taking ownership of it.
Related: 3 ways to identify your company’s unique marketing angle
4. Improve customer service
Let’s say you have the same product that serves the same market as everyone else. In this case, your best option may be to differentiate and establish a competitive advantage with excellent customer service. If you can amaze people with your customer service, you will create a loyal tribe of customers who will constantly choose you over the competition (even in situations where your prices are higher or your product options are more limited).
5. Make your business an attractive acquisition goal
Competitive advantage alone will not guarantee bids. However, this sets you up well for these conversations and gives you much more influence in the negotiations and due diligence. If you have something that no other company in the industry has (or something that they can’t easily replicate), it adds some inherent value to your organization.
With that in mind, it would be wise to spend the next few months focused on how you can create a competitive advantage or strengthen one that you already have. This is your ticket to success.
Related: How to position your business for strategic acquisition