Do You Know Your Competition?

When studying the competition, I take a page out of the playbook of some of the sports coaches I admire. Take John Harbaugh for instance. For those that don’t know, he’s the head coach of the Baltimore Ravens and in 2013 he conducted an experiment. He logged the amount of time he spent analyzing the opposing team over the course of one week. In that time, he devoted 32% of his time deciphering the competition. This dedication to understanding his opponent has made him one of the most successful coaches in the NFL, and I think it stands to reason that flooring retailers could learn a thing or two from his approach.

In a tough retail environment, it is crucial that store owners and managers know their competition almost as well as they know themselves. That’s why I encourage regular and consistent shopping of the competition, learning their moves and deciphering their strategies. What does it mean to “shop the competition?” My method is to shop at every stage, from greeting to installation. This goes far beyond sending a team member to a nearby store to check the product and the pricing. This means putting yourself into the customer’s shoes to learn everything you can, including

  • How they sell the product
  • What services they provide
  • What steps do they take to get the product out the door
  • What is the quality of the workmanship
  • How is the communication between customer and the retailer at all stages of the process

It may seem like a tall order, but the results speak for themselves. A survey conducted by us over a three-year period showed that flooring owners who shopped their competition monthly experienced the following financial growth:

  • Total net sales volume $1,492,479 greater than the average
  • Total net sales volume $1,879,418 greater than those who did not shop the competition
  • 6% total growth of net sales for those that shopped the competition while those who did not shop experienced a 0.2% DROP in growth of net sales (if that alone doesn’t make you want to start shopping, I don’t know what will!)
  • Sales productivity was $96,313 more per full-time sales equivalent than those who did not shop the competition, and $71,137 higher than average.

So what do these numbers mean for you? It means by understanding your competition your store and your staff will experience myriad benefits. For starters, your staff will have a clear idea, or “playbook,” of strategies to outmaneuver the competition at every turn. One of the key elements is that your staff will become more equipped to handle price objections. All too often, a customer will claim the product is being offered elsewhere at a lower price. Unless the associate knows the competition, prices are often dropped unnecessarily, which directly affects your margins. In addition, when your sales team is truly confident that your business offers a superior product and superior service, that confidence and pride shows. This results in a team that sells as much as possible, upsells on things like cushion and grout, and even adds on accessories such as cleaning supplies, heating elements and more.

Of course, giving up 32% of your time to shop the competition as Mr. Harbaugh does is far from feasible. It has, however, been proven that shopping each competitor at least once a quarter pays huge dividends. Give it a try and see how it can turn your team into the winning team.

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