- Kojo’s story.
Kojo is a brilliant Computer Engineer who has set up his own software company in Accra. He has been in business for the past five years and is doing well.
Kojo started playing around with computers when he was only a toddler. Initially, his father used to get angry with Kojo because he would dismantle the toys bought for him, including toy computers, within a week; his mother’s interventions helped to sort things out. And so it was no wonder he graduated top of his class in Computer Engineering at the Kwame Nkrumah University of Science and Technology, with first class honours.
He had a very creative mind and was passionate about what he was doing. He used to work for an established foreign software company but his ideas seemed to be conflicting with those of his boss. So, he resigned after four years in that company to start his own. His creative mind, coupled with brilliant salesmanship and negotiating skills pushed him up the business and social ladder. His company was doing well until recently.
Kojo soon began to notice something about his contracts. His new contracts seem to be falling into different hands after negotiations, even when he believed he had done a brilliant job. New jobs stopped coming; and he was losing some of the old clients.
He sought to know what he was doing wrong from clients but he was always met with stony silence. He was having sleepless nights trying to answer his own questions. Why? What is going on? Where has he gone wrong? Why is nobody telling him anything? This was beginning to tell on him so he took a month’s vacation.
Kojo spent all the holidays at a beach in Axim, alone, reflecting on what was happening to his business. He walked on the sand barefooted. He played with the sand. He watched the sea and its waves. He swam in the sea.
Just when the vacation was about to end, he had an idea. He called his assistant in the office and asked him to compile a list of all the known software companies doing business in Accra, old and new. It was a tall order and the assistant was about to complain, but the steel in Kojo’s voice changed his mind. Kojo’s instructions were clear – to leave everything and focus on compiling the list of software companies.
Once the list was complete, Kojo called a journalist friend to investigate the relationships between his clients and the software companies.
Two weeks after Kojo resumed work, the journalist submitted his report. The summary was enough to throw him off balance. His competitors, including his former company, were consistently under-cutting him to take his jobs. Worst of all, they had information on all Kojo’s transactions. They were simply calling his clients and negotiating contracts of lower values with information fed by his own staff! He fired all his technical staff.
- Who are competitors?
Competitors are businesses, which are able to offer similar goods or services to your customers.
While competition may not be bad in itself, it may assume an unhealthy or negative dimension if not carefully monitored and managed. As seen in the case of Kojo, his competitors played him out the software business by compromising his staff.
Very often when someone starts a business and seems to be making progress, others come from nowhere to position competing businesses in the same market and relying on negative trade practices as seen above to draw away customers. .
Kojo’s story compares with a person who builds at an isolated place, drawing water from a distance to his house. Initially, he would enjoy the full force of the water coming into his house. However, as other people start putting up buildings in the locality and drawing water from the pipeline, the pressure and volume of water reduces considerably. Similarly, the competitors in business draw customers away from their rivals, sometimes pushing them into bankruptcy.
- How do you handle your competitors?
Competitors, if not handled properly, can throw you out of business. So, as much as competitors are not part of your job schedule, you need to keep an eye on them.
- Differentiate your business from your competitors’ by doing outstanding jobs, which could put a distance between you and the crowd.
- Give excellent customer service.
- Where you realize you cannot outperform your competitor, negotiate a better deal to keep your business profitable with the available customer base.
- Never forget to read reports put out by your competitors, however trivial.