It is necessary to do a competitor analysis. Because you may use their data to define your goals, marketing plans, tactics, new product lines, pricing, and more. Use competitor analysis to:
- Identify the strength and weakness of your candle making business competitors.
- Search for opportunities to distinguish your candle making business from competitors.
The first step is to determine who your direct and indirect competitors are.
The direct competitor consists of other candle making businesses that offer essentially the same candle products to the same people as you do.
Your indirect competitors are other options that customers have to purchase from you that aren’t direct competitors.
Among indirect competitors are big-box stores, craft stores, home decor stores, and general stores etc. You should also mention the competitors.
Once you’ve identified the competitors, concentrate on the direct, head-to-head competitors, since they are the most threatening to your candle making business— but keep an eye on the indirect competitors as well, just in case.
Provide an overview of each direct competitor’s business and detail their strengths and weaknesses.
You will be able to position yourself competitively in the market if you perform proper competitors research. Perform a SWOT Analysis to learn your competitors’ strengths, weaknesses, and competitive advantages in the following areas:
- Prices – Are they offer cheaper candle products or more costly than you and other competitors, what value do buyers get for that price?
- Quality – Are they offer premium candle products, the perceived worth in the eyes of the customers
- Customer service – How they respond to their consumers, whether they treat them poorly or well, and the degrees of satisfaction customers show
- Reputation — The sum of everything mentioned above: their credibility, how loved the brand is, and the loyalty of their customers
The final section of your competitive analysis should include a list of your areas of competitive advantage. for example: Are you going to offer premium candle products? Will you have unique or specialty products? Will you offer better pricing or will you offer greater customer support?
Consider how you will outperform your competitors and include them in this portion of your candle making business plan.