How to compete with the giants

A month ago, another invitation came to me to address one of the major cities in the region in front of managers and owners of retail companies with the theme "How to compete with the giants": with large federal and international chains that come to regions? "

This question has arisen with an enviable regularity for the last three years. And this is certainly not accidental. The concern of local independent retail companies seems to be obvious, and is associated with a slowdown in the growth of the retail market, increased competition, regional expansion of large networks, and consolidation of the industry. But is it worth it to be so concerned about these macro trends? Undoubtedly, but not in terms of the fact that major players will occupy the entire market and consolidate the industry. For example, in the developed retail market in the US, where business is conducted by such giants as Wall-mart, Target, Safeway, the consolidation level does not reach 60%. According to the forecasts of the Ministry of Economic Development, the level of consolidation in Russia in food retail by 2015 will not exceed 35%. But it's worth worrying that most local independent retail companies offer their customers the same value as big players and try to work with the same segments of customers. And, naturally, with increasing competition, they will inevitably face direct competition with large companies, but here, as a rule, whoever is bigger, he is also "right".

How to avoid direct competition and stop being afraid that big networks will come tomorrow, and you need to prepare for selling or closing a business? The answer to this question lies in the answer to another question, which is relevant for many companies that conduct business in highly competitive markets. This question sounds like this: "What additional value does your company (your product, your store) offer for your target customers?" Despite the simplicity of the wording, this issue and, accordingly, the answer to it is of fundamental importance for the successful conduct of an independent retail company's business. The key aspects in the search for an answer to this question is understanding your customers and creating for them an added value that your competitor can not offer. A clear example of a deep understanding of their customers and creating a unique added value for them is Trader Joe's, one of the most successful independent retailers in the world, with an annual revenue per square meter of around $ 17,500, an average of two more than the other the fastest growing large retail company Whole Foods, whose shares are listed on the stock exchange .....