At LINK, we’ve worked with countless buyers and sellers across a variety of industries. One consistent truth? The businesses that succeed under new ownership are those where the buyer has done their homework, not just on the business financials, but also on the market the business operates within.
Why competitor analysis matters:
A business’s past performance tells you where it’s been. Competitor analysis tells you where it’s going and what key factors may impact its future. When you buy a business, you’re not only buying its assets, staff, and customer base, you’re also inheriting its competitive position within its current market.
By taking the time to understand this position, you can:
- See whether the business has the resilience to withstand market pressures.
- Identify if the industry is on the rise, levelling off, or in decline.
- Spot overlooked opportunities for growth.
Without this insight, you risk acquiring a business that looks solid on paper but struggles to keep up in practice and one that isn’t future-ready.
What to look at when assessing competitors:
Competitor analysis doesn’t need to be overwhelming, but it does need to be structured. Here are the key areas we recommend every buyer explores:
- Market share and positioning: Who holds power in the industry? Are there a few major players dominating the space, or is it fragmented with multiple smaller operators? Knowing where your target sits within this picture helps you understand whether you’re buying into a challenger, a leader, or a niche provider — and what that means for your strategy going forward.
- Strengths and weaknesses: Every competitor has their advantages and blind spots. Their strengths show you the standards you’ll need to match, while their weaknesses highlight potential opportunities. For instance, if rivals are known for variety but fall short on customer service, you may have the chance to win loyalty through personalisation and support.
- Differentiation: The businesses that thrive are those with a clear edge. Does your target stand out for its products, its brand, or the way it serves customers? Or does it look much the same as everyone else? If it’s the latter, you’ll need a plan to sharpen its point of difference and stand out in a crowded field.
- Barriers to entry: Consider what makes it difficult for others to enter the market. High start-up costs, strict regulations, or entrenched customer loyalty can all protect your acquisition. On the flip side, if barriers are low, you’ll need to be prepared for fast-moving competition.
Turning insights into opportunity
Competitor analysis isn’t just about protecting yourself from risk. Done well, it’s also about finding hidden opportunities. Buyers often discover that:
- Competitors have ignored profitable niches.
- Pricing models are outdated, leaving room for a fresh approach.
- Customer needs are shifting faster than incumbents can adapt.
These insights allow you to walk into an acquisition with a growth strategy already forming — one that builds on strengths, addresses weaknesses, and leverages the gaps competitors have left open.
The LINK perspective
At LINK, we believe buying a business is about more than numbers. Financial health is vital, but it’s only one piece of the puzzle. The bigger picture lies in whether the business has a defendable and expandable place in its market.
We guide buyers to look beyond the spreadsheets and into the future potential of the business. By understanding the competitive landscape, you position yourself for success. You’re not simply purchasing a set of assets; you’re investing in a position within a market that can evolve and grow with you at the helm.
With clarity and confidence, you can make smarter decisions, avoid surprises, and step into ownership with the foresight you need to succeed.
For more information, get in touch with us here.
