"If you build it they will come.” That line may have worked for Kevin Costner’s character in Field of Dreams, but such advice could spell disaster for your company. Developing a better product or service is a challenging proposition that takes time, energy, and focus, but it’s just the first step in building a sustainable business. In fact, in many ways, the product offering is the easy part. Finding your customer, selling the product, and making money in the process—now that’s the tricky part.
Where Does Your Business Stand?
The starting point for any good marketing plan is to step back and assess your current situation—honestly and openly defining your current business. It is important to be systematic in your process and develop a clear understanding of where you are, where you want to go and how to get there. In short, it is hard to know where you are going (or want to go) if you do not know where you are. There are many ways to go about this process, but in general most businesses will start by performing a SWOT Analysis.
SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. This is a relatively straightforward process that can offer powerful insight into the nature of your business—what it has to offer to the market. At the same time it offers a sense of what obstacles or challenges you may face as you look to grow your business.
Strengths and Weaknesses
Strengths and Weaknesses are internal to your own business. What does the business do well? What does it do poorly? What is the core competency? And what are things that are not working?
Consider internal factors within the company related to the product, pricing, costs, profitability, quality, people, technical skills, brand, advertising, reputation, processes, infrastructure, etc.
Examples of Strengths and Weaknesses would include:
- Good margins and profit for each system installed
- Great manufacturing/assembly facility to pre-build systems
- No consistent message to target customer
- Weak accounting system makes it hard to capture all hard and soft costs
- Experienced staff knows how to work together and do their job
Opportunities and Threats
Opportunities and Threats are external factors. What are the things that currently impact the company or could have an impact in the future? What factors out in the world need to be considered and planned for? These external factors to the company include market trends, new technologies, competitors, demographics, policy initiatives, supply chain, economic growth, etc.
Examples of Opportunities and Threats would include:
- New competitor entering the market
- Change in the financial incentives offered to solar
- New panel or inverter technology that impacts value of current products
- Economic downturn reduces consumer spending
- Increased consumer awareness and interest in solar power
- Key supplier is in financial trouble and may no longer be not be a reliable component source
How is Your Business Perceived?
One of the keys to this process is to collect information from all the stakeholders for the business. Start with the internal stakeholders: your employees. This includes all staff, from sales to engineering to accounting. The next group to focus on is the external stakeholders, both existing and potential. This means talking to your existing customers, your existing suppliers, the local power company, government officials, your competitors’ customers, and interested consumers who are not currently customers.
Asking good questions of these people will open up the discussion and lead to some major insights into your business and market. Have a list of key questions you want to cover and you will be amazed at the willingness of people to talk and give you their opinions. This is a great way to understand how your business is perceived, both internally and externally, and will usually reveal some different perspectives that you may have never considered.
Obviously every business is unique and has very specific circumstances, so there’s no one set list of questions to ask. Below are some examples that you can use as a starting point to pick and choose from and refine for your own circumstances.
- What are the biggest assets in the company? Which of these is the most important/strongest?
- What makes you better than your competitor? What makes your competitor better than you?
- Who is your best customer?
- What is unique about your company?
- What are the skills and abilities of your staff? What skills are you and your staff missing?
- What do other people think your company does well/poorly?
- What is the market missing?
- What problem are you solving for the customer?
- What is the biggest threat to your business? What is the biggest opportunity to grow your business?
- What is the biggest obstacle holding your business back?
Using the information collected from the interviews with stakeholders you will have the information to develop a clear SWOT Analysis of your business. This will give you a clearer sense of where you are and where you want to go to grow the business. For more insight into how to conduct an effective SWOT analysis, download our free SWOT Analysis Template for small solar businesses.