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8.1.2024
Industry analysis plays a crucial role for any manufacturing business as it enables one to examine past trends, identify current demands and anticipate the future outlook of the industry. Now, this analysis also serves as a recommendation when an unexpected development takes place in the industry. It encourages constant improvements, and it's worth investing time and resources.
Today, there are more than a million industrial manufacturing companies in the USA. That means there is much competition in the same segment. And you have to constantly make a difference in your product line or give the consumers a solid competitive price. How can you make this happen in 2024? Fret not; this blog will help you uncover some fantastic facts about competitive price analysis for industrial parts suppliers specifically.
Let us just rip right into it.
Firstly, let us understand the basic concept. A competitive analysis consists of monitoring the products and sales/ marketing strategies of the competitors. It helps in understanding where other industrial suppliers in the market are placed and how the competitors get visibility. It also helps gauge the strengths and weaknesses of your business and your competitor's business.
Understanding your strengths and weaknesses helps in tweaking the tactics and making improvements in your sales and marketing initiatives. Competitive price analysis is a part of the comprehensive competitive analysis, which helps in devising strategies to beat the competition and gain an edge over other industrial suppliers. WebDataGuru is one of the leading web data extraction companies which provides best-in-class pricing tools for all kinds of industries and businesses.
The benefit of competitive analysis is that a business can apply any approach that is effective for the company. Irrespective of the competitor's aspect that you want to assess, the following steps can help with analysis.
The first step for conducting a competitive price analysis is to gain an overview of what the competitors are doing. As mentioned earlier, many companies are targeting the same client base. And you need to identify which manufacturers or suppliers are your prime competitors, as you cannot compete with all. Choosing only a few, like 5-10 competitors based on market size will offer a fair view of the competition and also make your business perspective more transparent and precise. However, it is recommended to choose businesses of different sizes and tenure and the ones that offer the same solution as yours and cater to the same target audience as yours. It improves the chances of identifying areas of improvement and success.
Research is always crucial for every step of growth in a business trajectory. Similarly, an essential part of the competitive analysis strategy is market research. It helps gain insight which can drive your future efforts and strategies. The first step is to search for the right target audience based on their interests, needs, demographics, etc. Create ideal buyer profiles to identify customers. This will help in developing branding strategies for manufacturing companies.
Customer surveys and polls can be a powerful tool to find out what customers want. Reading customer reviews on competitor websites and social media or chat threads on forums will offer an idea of what people think about your company and competitors. Looking for common concerns and complaints will enable you to solve them.
The next step of competitive analysis is to compare your products, price, and marketing strategies to competitors. Examine their products from the viewpoint of functionality, features, and price. Look at their promotional strategy for their products.
With price analysis, manufacturing companies and suppliers can find out about the prices that competitors are charging for similar products. It enables them to set the right price point to stay competitive and retain their customers.
Explore their advertising strategies, press releases, and media coverage, along with their social media presence. Please take note of the tone and language of their business message and how customers respond to it. Try to gauge the kind of engagement they fetch and if they are receiving positive results.
The final step is to assess and examine your own business, products, price strategy and marketing campaigns to identify strengths and weaknesses. Look for areas where you lag behind and need to outdo the competitors. Make adjustments in the strategies and pricing to improve your shortcomings. Capitalize on the opportunities for the development of new products that you missed previously and consider potential threats.
Apart from competitive price analysis, a manufacturing business needs to perform a SWOT analysis to use all the information gained from the competitors and shape the business strategies that can put it ahead of the competitors.
It is not sufficient to have casual knowledge about the competitors, and a manufacturing business or industrial parts supplier company must dive deep to create sound strategies for their business.
Let's look at 4 pillars of competitive analysis:
The competitor's objectives can be non-financial or financial. It is reflected in their organizational structure, risk tolerance, legal restrictions, management incentives, board of directors’ composition, and other corporate goals influencing competition. The organizational structure of competitor can help identify their objectives. Being aware of competitor's objectives is essential to know how they will respond to any competitive move made by you.
Competitor's assumptions are based on their opinion on competitive position, regional factors, manufacturing industry trends, and past experience regarding a product. Their assumptions will be applied to determine the strategies they use in the market. Their beliefs are based on facts and fears, which can turn out to be accurate and untrue.
Competitor's objectives, strategies, and assumptions reflect how they wish to respond to the competition, but their ability and resources decide how fast and effectively they can respond to competition. At times, the ability to adapt to any change might be hindered by their organizational structure, heavy investment in fixed assets, and low cash reserve.
To learn what the competitor manufacturers are planning, you must keep an eye on what they say and what they do. They might directly or indirectly talk about their strategies in statements, interviews, shareholder reports, and press releases. However, you can't rely on that alone as sometimes what competitors do is quite contrary to what they say.
Look at the competition's research and development projects, mergers and acquisitions, hiring activities, promotional campaigns, capital investments, and strategic partnerships. This is the true reflection of their strategic plan, as what they say out in public might be what they aspire to do in the future and only a bit of what they are doing currently.
Manufacturing companies can benefit from competitor price analysis along with product, sales and marketing analysis to make informed decisions and develop robust strategies.
Automated businesses will have more chances to stand in this ever-changing market. Constant updates, fast-changing consumer preferences and even changing market dynamics – Only tools like competitive analysis can help you achieve your goals on time. The simple logic is that it can help save so much time and energy. Basically, by mastering the art of analyzing and responding to market pricing dynamics, industrial parts suppliers can navigate challenges, optimize profitability, and emerge as market leaders in their sector.
So, gear up for success as we delve into the intricacies of competitive price analysis for industrial parts suppliers. Book a demo now!
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