Business Strategy

A business strategy is formulated by selecting the target audience of the product and assembling the marketing mix. A firm can assemble marketing mix elements in many different ways so that the relative weightage of the different elements will be different in the different combinations. Because of this reality, business firms are employing an abundance of strategies and strategy stances. It is a relentless race to stay ahead of competition.

Basically, however, there are only two broad routes available for forging business strategies. They are the price route and the differentiation route. In other words, any strategy has to be ultimately either a price-based strategy or a differentiation-based strategy.

Companies taking the price route compete on the strength of their pricing and the price cushions they enjoy. Normally, those who resort to the price route and compete on price will enjoy substantial cost advantages, giving them flexibility in pricing and marketing. The differentiation route, on the other hand, revolves around elements other than price. The product with its innumerable features is one major source of differentiation. In fact, any of the ever-so-many activities performed by the business unit can constitute the nucleus for differentiation.

In other words, differentiation allows the company the freedom and flexibility to fight on the non-price front. Differentiation, therefore, is a crucial option for a firm in its search for a rewarding strategy. A good majority of business battles are in fact fought with a differentiation-based strategy rather than a price-based strategy.

As already mentioned, a business unit that opts for the price route in its competitive battle will enjoy certain flexibilities in the matter of pricing of its products, and use price as the main competitive lever. It will price its products to suit varying competitive demands. It will enjoy certain inherent cost advantages, which permit it to resort to a price-based fight.

Small Business Battle of US and China

It turns out that the Chinese are incredibly superior businessmen, and one would have thought living in such a strained out and socially strict cultural society in the past, would have prohibited that from going on. But times have altered and the people of China are in fact often considered more improved capitalists than the citizens of the United States. There have been many business people come from rags to riches and become billionaires in the People’s Republic of China.

However, the best thing that is happening now and coming quicker than ever before, growing at a rapid pace is the rise of the Chinese small business social class. They are starting small businesses on the internet, small businesses on the street corners, and many are showing no fear in their pursuit of large money. This is a prosperous series of time for China to take advantage of on their small commerce power.

Most people do not understand it but in the United States seventy-five percent of the nation are employed by medium to small businesses and ten percent of the residents own a business. The USA is small-business, and it really is the spine of our financial system. Some people believe that the big corporations are the ones that make our market so sturdy, but that is not really even close to the truth. It is the small and medium size companies that make the disparity.

Even though the United States is still one of the top economies in the world they are quickly being downgraded due to the economy collapsed and the spread of capitalist globalization. Many experts predict that within around ten to twenty years the Chinese GDP will surpass the United States and will keep growing trending towards the positive for the next twenty years after that. For those living in the United States it may be of worry as the dollar is also being downgraded but in all reality the whole words business arena is changing and every country will have to adapt or be left behind. The United States has always been known to adapt to situations especially with business so it will be interesting to see which country emerges as the powerhouse of the 21st century.

Why You Need A Business Battle Plan

If you want to drive from Chicago to Albuquerque, do you just jump in a car, start driving, and see what happens? Drive real fast in no particular direction and hope you get there sooner or later? Not a chance. If you’re a rational person you’ll start with a roadmap or a GPS, and you’ll probably check more than one to compare and consider your options. You’ll ask people who have made the drive before to give you advice. You’ll find out how long it will take, what the landmarks and milestones are, which route suits your purposes best. You’ll make sure your car is in good shape so it won’t die on the way and leave you stuck in the middle of nowhere.

Then you’ll customize your roadmap, marking the towns where you’ll rest and refuel and the junctions to watch for, and the names and/or numbers of every road and highway you’ll take. You’ll print out that map and keep it right beside you for the entire trip, checking it often to make sure you’re still heading in the right direction. Or you’ll program your GPS with every important waypoint, and keep it in your field of vision at all times to check your progress and mileage.

Trying to run a business without a business plan is every bit as insane as trying to drive from Chicago to Albuquerque with no map, no directions, and no idea how to get there or how long it will take. In fact, running a business without a plan is even worse-it’s like driving BLINDFOLDED! It will get you KILLED. But that’s exactly what most business owners think they can get away with doing. And that’s one of the main reasons they end up stuck. They run around in circles with no direction until they run out of time, money, and energy, risking burnout or even bankruptcy.

But YOU are not going to be one of them, because YOU are about to create a bullet-proof plan and a budget and keep them beside you on the seat the entire time you’re at the wheel.

A business plan not only helps you stay on track, it also helps prepare you for battle. It becomes a kind of résumé and foundation for the entire business. It describes what the business really is, why you’re doing it, who is on your team, your strengths and weaknesses, and most importantly-how much you intend to earn and what you will do to get it.

If your business model requires investment capital, you might already have a business plan you created to show potential investors. If so, ask yourself this question: is it a plan you actually use day-to-day or something you dreamed up to make the business look good on paper that you haven’t looked at or thought about in the past six months?

If you think you don’t need a plan because your business model is so simple, or because there’s no need for investment capital at the moment-think again, soldier. Even if you were only driving from the house to the grocery store, doing it blindfolded would be suicide.

Kick Ass, Make Money & Have Fun Doing It!

Craig Zuber