Exercise 1: Finding Competitors Around You

Never assume your market is unique. That’s the single most dangerous shortcut in strategic analysis. You might think your coffee shop is the only one in town — but if you’re not actively looking, you’re already losing ground. Many beginners skip this step, assuming competition only exists in big corporations or online platforms. That’s a myth. Real competition is everywhere — in your neighborhood, your local transit stop, even the way people choose lunch.

This exercise isn’t about finding a list of companies. It’s about training your mind to see competition as a pattern, not just a list of names. I’ve seen business students miss entire markets because they only looked online. One student analyzed a “local bakery” and concluded low competition — until they walked two blocks and found three more. That’s the power of observation.

By the end of this exercise, you’ll be able to identify direct and indirect competitors using only your eyes, ears, and a simple worksheet. You’ll recognize market rivalry examples in everyday life — not as theory, but as real situations. The goal is to build a habit of seeing the whole competitive picture, not just the obvious player.

Step 1: Define Your Business or Product Visually

Start by writing down the core offering you’re analyzing. Be specific — vague descriptions like “I sell food” won’t help. Instead, think in terms of purpose and function.

For example:

• “A single-origin cold brew coffee sold in 16oz glass bottles”
• “Handmade, plant-based soaps in small batches”
• “Local walking tours focused on historic architecture”

Choose one. It doesn’t have to be a real business. Just something tangible enough to observe.

Step 2: Observe Direct Competitors in Your Environment

Walk or drive to your area. Look within a 500-meter radius. Stop at every shop, outlet, or kiosk that offers a similar product or service.

Ask yourself:

• Do they sell coffee? Does it match the same use case? (e.g., morning pick-me-up)
• Is the product similar in quality, price, or form? (e.g., bottled cold brew vs. freshly made)
• Do they target the same customer? (e.g., young professionals, tourists, health-focused buyers)

Write down each competitor you see. Use this simple table:

Competitor Name	Type	Price Range	Location	What Makes Them Similar?
Coffee Hive	Specialty café	$5.50–$7.00	100m east	Offers cold brew, same price point
QuickStop Market	Convenience store	$4.00–$5.50	200m north	Sells bottled cold brew, lower price
Green Leaf Co.	Online brand	$6.00–$8.00	Delivery only	Same product, organic ingredients

Notice how the third competitor is online. That’s not a mistake. Online presence is a form of direct competition — especially if customers can compare prices and reviews easily.

Pro Tip: Don’t Skip Indirect Competitors

These are often overlooked. They don’t sell the same product but meet the same need.

For example, if your product is cold brew coffee, an indirect competitor might be:

• A nearby energy drink vending machine
• A café that sells a low-sugar iced tea
• Even a local gym offering free caffeine packs

Ask: “What would a customer choose instead of this product?” That answer is your indirect competition.

Step 3: Reflect on Market Rivalry Examples

Now that you’ve listed your competitors, take a moment to reflect. What patterns do you notice?

Here are three common market rivalry examples to guide your thinking:

1. Price-based rivalry: Competitors are close in price and quality. The one with the lowest price wins — especially in everyday, low-involvement decisions.
2. Quality-based rivalry: Competitors differ in quality. One offers premium organic ingredients; another relies on mass production. The market splits between those who prioritize taste and those who prioritize cost.
3. Convenience-based rivalry: One shop is open 24/7, another is only open weekdays. A mobile app delivery service might win over a location with slow service.

Ask yourself:

• Which competitor is most visible? Why?
• Are they offering something more convenient, cheaper, or better in quality?
• Do customers seem loyal to one brand? Or do they switch based on mood, price, or availability?

These insights help you understand the nature of rivalry — not just who’s there, but how they compete.

Step 4: Use the Worksheet to Formalize Your Findings

Now that you’ve observed, use this template to record your findings. It’s the same one used in real strategy reports — but simplified for beginners.

Competitor Analysis Worksheet

• Business Name: [e.g., Coffee Hive]
• Product Type: Cold brew, single-origin, 16oz glass bottle
• Price: $6.50
• Where Found: Corner store, local café, online
• How They Compete: Focus on freshness, premium ingredients, in-store experience
• What Sets Them Apart: Organic beans, locally sourced, cold brew aged 24 hours
• What’s Missing: No online store, no delivery, not available after 5 PM

Repeat for each competitor. You’ll start to see patterns — and opportunities.

Common Mistakes to Avoid

Even experienced analysts get these wrong. Here are the top three pitfalls in the find competitors activity:

• Only looking online: If you only search “cold brew” on Google, you’ll miss the local shop across the street.
• Confusing size with competition: A small bakery isn’t automatically a competitor to a national chain — unless they target the same customers with similar products.
• Overlooking digital competitors: Just because a company doesn’t have a physical store doesn’t mean it doesn’t compete. Amazon, delivery apps, and social media shops all count.

Remember: competition isn’t just about who sells the same thing. It’s about who satisfies the same need in a similar way.

Why This Matters: The Real Value of the Competitive Rivalry Exercise

This isn’t just a warm-up. It’s the foundation of all strategic thinking.

When you learn to see competitors in your environment, you start to see how markets really work — not through textbooks, but through real observation. You’ll notice that rivalry isn’t just about price wars. It’s about perception, convenience, and trust.

One student analyzed a local farmers’ market and found that vendors with better packaging and signage attracted more customers — even when their produce was slightly more expensive. The lesson? Competition isn’t just price. It’s perception.

Now you’ve done the work. You’ve seen the patterns. You’ve asked the right questions. This is where real strategy begins — not in a spreadsheet, but in a café, on a sidewalk, or in a shopping aisle.

Frequently Asked Questions

How many competitors should I identify in this exercise?

Start with 3–5. That’s enough to see patterns without getting overwhelmed. If you’re in a dense urban area, you might find more — but focus on quality over quantity. Prioritize those that are most visible and accessible.

Can a competitor be a website or app?

Absolutely. If a website offers the same product and targets the same users, it’s a competitor — even if it’s not physically nearby. For example, a local deli might face competition from a grocery delivery app offering ready-made sandwiches.

What if I don’t have a physical business to analyze?

That’s fine. Choose a product you regularly use — like coffee, shampoo, or snacks. Observe where you buy it. List stores, websites, or apps that offer the same item. This turns everyday choices into real strategic data.

How do I know if a competitor is “direct” or “indirect”?

Ask: “Does this product solve the same need in the same way?” If yes, it’s direct. If it meets the same need but through a different means (e.g., energy drink vs. cold brew), it’s indirect. Think of it as “same problem, different solution.”

Is it fair to count a big chain like Starbucks as a competitor if I’m analyzing a small local shop?

Yes — but with nuance. If the local shop competes on the same market segment (e.g., premium cold brew for young professionals), then yes, it’s a direct competitor. But if the local shop sells organic, handmade soaps and Starbucks doesn’t, they’re likely not rivals. Context matters.

Can I use this exercise for a school project or assignment?

Yes. This is exactly how professional analysts begin. Use your worksheet to document your findings. Include a brief reflection on what you learned about competition in your area. The goal is to show observation, critical thinking, and pattern recognition — not perfection.

Now that you’ve completed the competitive rivalry exercise, you’ve taken your first real step toward thinking like a strategist. You’ve seen how rivalry isn’t just about numbers — it’s about people, places, and choices. The next time you walk into a café, you won’t just order coffee. You’ll see the market.