Follow these guidelines as you develop your clothing store business plan competitive analysis, a section that lists your store’s direct competitors and describes how you will gain an edge over them.
How to choose competitors
First, competitors may or may not be limited to clothing stores in your neighborhood. Direct competitors, to be more exact, are the other options your customer’s target market has instead of buying from your store. This could include buying from a website, ordering from a catalog, department stores, mass retailers, even the Salvation Army, as well as specific clothing stores that sell competitive products.
Second, there must be competitors in your plan (although not too many; three or four should be enough). Even if your products will be so specific that your potential customers cannot currently buy them (i.e. baby leather jackets), they are currently buying something to meet the same general need and will still be able to choose between that and your store after it opens. Readers of a business plan want to see that the writer understands that there is always a competitor or substitute for any product or service. They will find a writer who thinks they have no competitors to be naive or they will believe that the market is too small to serve profitably used clothing stores.
How to Research Competitors
Researching online through reviews of the competitor’s store or service and your website itself is a first step. Then go the extra mile to show your seriousness by visiting competing stores and making a purchase yourself, if you haven’t already. Consider the customer experience and the quality of the clothing they sell. Going one step further in talking to your customers, formally or informally, about their likes and dislikes about the store can further strengthen your competitive analysis section.
What to write about the competition and your own store
When you put pen to paper, start with the basics of the competitor’s situation (location, size, income if you know or can estimate it, years in business). Describe why your store is valued and the key methods they use to drive customers to visit and buy, be it pricing, promotion, service, or product quality. Then comment on the advantages over this competitor that you will be looking for, which will make your customer’s target market increasingly choose your store. Any benefits you mention here should be detailed elsewhere in the plan. If possible, show the barriers to imitation that exist or that you can establish. For example, why can’t the competitor just start offering the same variety, lower prices, or add the line of products they will sell? In a few paragraphs, you should be able to present a concise case to understand the opponent and how your store will fight him.