Competition is a natural and integral part of doing business. How successful you become at competing depends on how you position your business relative to your competitors.

Differentiating your business means defining your company in relationship to the competition. It means that you understand and are able to communicate your point or points of difference and why youa??re better, or different, than your competitors. It means continuously making improvements to sustain a leadership position.

If you want to differentiate your business, you need to look at your business from your current and your prospective customersa?? perspective. Then, do a competitive analysis, and determine where your business fits in the mix. Identify and communicate specifically how you meet your customera??s needs in a way that no one else cana??in a way that is different or better than the competition.

Common points of differentiation include: cost, quality, performance, product availability, technology, leadership, timely delivery, superior service, durability and customer support. Creating a differentiation strategy is referred to as developing a Unique Selling Proposition (USP).

The Unique Selling Proposition (USP) is your biggest marketing weapon and is the key to differentiating your business from your competitor. What is a USP? In essence, it is a simple statement that sums up the unique features, benefits, and value that you provide that no other competitor can.

A competitive analysis lists your leading competitors; summarizes their products/services, promotional strategies, distribution methods, strengths /weaknesses, locations, offerings, prices, branding; and determines whether the business is growing, stabilizing or declining. These are the important questions:

Who are your competitors?

What customer needs/preferences are your competitors trying to fulfill?

How are their products/services similar to, or different from, your company?

How do their prices compare with yours?

Are your competitors able to offer superior quality products/services at a competitive or lower price?