Most books on the subject treat business as war. Your competitors are your enemy. Beating them out of market share is your goal. If you can get them to go out of business completely, you’ve triumphed. I don’t share that view. And I’ll tell you why. War is a terrible, painful, and ultimately destructive endeavor. It’s what you do when you are too desperate, scared, or stupid to do anything better. Sometimes — maybe — war is inevitable. But even then, it’s wasteful. Business shouldn’t be wasteful. It should be productive. You begin with a need or desire. You create a product to service that need or satisfy that desire. In place of a void (the need or desire), products, services, and relationships are established. And jobs are created.
You can — if you like the martial metaphor — run your business as if you are fighting a war. You can see your market as a battleground. You can hate your competitor. You can try to beat him out of market share and rejoice if he goes out of business. But if he does, what have you won? A position in a market that has lost one of the agents that was making it grow. Here’s a better idea: Think of the marketplace as a place where you and others in your industry have a common goal: to grow the market itself by creating more value for the customers. Imagine a market where this idea dominates. How wonderful would that be? Work first to service your customers. Work second to satisfy yourself and your employees. Work third to help your competitors.
All three efforts result in the same good thing: an ever-expanding marketplace of interested, motivated, and satisfied customers. The next time you have the chance to interact with a competitor, try thinking of him as a sort of colleague — someone who, though working independently, is trying to do the same thing as you: increase the size of your market. Try to understand that if he succeeds, the market (your market) will get bigger and you will benefit from that. Exchange ideas with him. Wish him well. Give him help if you can afford to. That is how I look at business. And it has worked for me. Making money now — personally and corporately — is much, much easier than it was when I started. The reason for that, I think, is that I work in a market where my “competitors” and my “employees” and my “clients” are willing to cooperate with me. And the reason I get cooperation is because they know I’m there for them too.
I was reminded of this issue last night. I decided to have dinner not at 32E, the restaurant my friend BS owns, but at SH, the restaurant next door. RG, SH’s owner, told me that he was selling his business to BS. He had been struggling to make it work but was giving up. “Why, RG?” I asked him. “He was there when I needed him,” RG said. “I knew he was a good guy. And a fair one. I knew that the price he’d offered would be a fair one.” “So you didn’t even bid it out?” “Nope.” I asked him how BS had helped him out. He said that over the two-year period SH was open, BS would stop by occasionally and chat. RG could see that BS was much more successful than he, and so he’d ask him questions. “At first, I was timid about asking,” said RG. “But BS was so happy to help me. It made it easy to keep asking.
He gave me good advice about everything: pricing, advertising, even the menu. He gave me names of vendors that brought down my costs. And he even tried to help me borrow some money once. “It really helped. I got myself out of the hole I’d dug. But after going through that, I realized I wasn’t cut out for the restaurant business. So I called BS and asked him if he wanted to buy me out.” Apparently, they struck some kind of deal that included some cash up front and a back-end payoff for RG. That is obviously just the kind of deal BS would want.
Next month, there will be a new restaurant on the avenue and two businessmen will have profited from it. Worry about how to make better products and create stronger marketing efforts. My focus is on competing with myself. Can I grow sales by 10% this year? Can I increase profits? In the short run, fighting with other people in the industry may garner you a few extra sales, but over the long haul you’ll do better by trying to be cooperative and helpful.[Ed. Note. Mark Morgan Ford was the creator of Early To Rise. In 2011, Mark retired from ETR and now writes the Palm Beach Letter. His advice, in our opinion, continues to get better and better with every essay, particularly in the controversial ones we have shared today. We encourage you to read everything you can that has been written by Mark.]