Instead of dreading competition, explore opportunities for collaboration and knowledge exchange with them. I’ve maintained a friendly demeanor toward my competitors throughout my professional journey. It’s become a habit for me to reach out and have conversations with leaders in my industry, whether or not I had a specific agenda in mind.
And this is a practice I would encourage every business leader to embrace.
I know it might sound ridiculous — “My competitors are out to eat my lunch!” — but I think you have much more to gain than lose by striking up these conversations.
Here are a few reasons you might want to hold off on calling your mother, and ring up your competitor first.
Gain information
You have a view of the universe and how things work for you and your business — and you have developed a strategy to take advantage of that landscape. Your competitor has done the same thing. And if you can be sure of anything, your competitor views the universe differently than you do, which causes them to make different decisions. But if you don’t understand how or why your competitor makes their choices, you could be making unforced errors with your business. In other words, the more you know about how your competitor views the universe and thinks, the better decisions you can make.
Give to get
When people talk to their competitors, they often think the game is to give as little information as possible while getting as much as you can. And that’s certainly one way to go about it. But building a healthy relationship with your competitor without sharing is not a practical strategy. That’s why I’m more than happy to be transparent about my business when talking to competitors. Now, I’m not giving away the crown jewels. But I do share first. Why? Because I believe in the Law of Reciprocity. By taking the lead in sharing information, I build trust, and I create a sense of obligation that they should give something back to me. By giving, you get something back.
And while you can try to play the game of giving them only what you think is low-value information, you never know. Because your competitor sees the universe differently, you could inadvertently give them something precious without meaning to. And that’s OK. I think it’s a mistake to believe that your strategic plan is so secret that if anyone learns it, you’ll go out of business. Every business is unique. Even if you handed your strategic plan to your competitor, they could never execute it like you can because of your unique strengths related to your people, capabilities, and customers.
Opportunity for collaboration
Since every business is unique, that also creates opportunities for businesses–even competitors–to collaborate. There might be an area of the industry or even something related to the regulatory environment where you can work together toward a common goal that benefits both companies. There is an ethical line you can’t cross when working together. But by reaching out and talking to your competitors, you might find opportunities to work together thaty you never would have known about otherwise.
In my career, I remember calling a competitor and learning about a small product line they didn’t think was important. But I saw how it could be a significant addition to my business. As we continued talking, they eventually agreed to sell me that product line, which I could have never done if I hadn’t begun to build a relationship with them.
Identifying buyers and sellers
Probably the most straightforward reason to talk to your competitors is to build a relationship so you’ll be the first call they make if they ever decide to buy or sell. Then, when negotiating a transaction, things are easy because you already know and trust each other. That’s why every time I conversed with one of my competitors, I’d always tell them, “If you ever consider selling, give me a call first.” I would always say this in a friendly and non-aggressive way. Just planting seeds. In one case, about two years after a conversation with a competitor, they gave me a call and said, “Were you serious when you said you’d like to buy us?” I said I was, and we ended up making a deal.
Rethinking your competition
It’s time to rethink your competition. Don’t fear them. Instead, think of them as sources of information, potential partners, or even a potential seller or buyer for your business. So, pick up the phone and give your competitor a call. And then call your mother.