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To understand why having a strong USP is important, you simply have to visit any shopping centre and take a look around. How many clothing retailers do you see? How many cafes? Opticians? Bookshops?
Chances are, there are more than one. And if you look closer, you will discover that they are offering very similar products and services. What is worse is that with the proliferation of e-commerce, many of these businesses are not only competing with the shop in the same mall with them, but with an e-retailer located in another part of Singapore or even around the world — where favorable exchange rates make it cheaper to buy from them online.
Avoiding a Race to the Bottom
In today’s hyper-competitive, internet-connected and globalized business environment, few businesses are truly unique. Thus, unless you can effectively define what makes your company’s product and service unique, you will blend into the sea of homogeneous competitors. And without something to differentiate you from your competitor, you will invariably be forced to compete based on price.
As a price war is fundamentally a race to the bottom by seeing which business can offer the lowest price, even if you out-last your competitor, a prolonged period of low or no profit would likely impact your business’ chance of survival. At the end of a price…
