Your competitive analysis should identify the indirect and direct competitors your business faces and then focus on the latter.
Direct competitors are other nightclubs.
Indirect competitors are other options that customers have to purchase from that aren’t direct competitors. This includes restaurants, casinos, bars, etc. You need to mention such competition to show you understand that not everyone who goes out for the night frequents a nightclub each time.
With regards to direct competition, you want to detail the other nightclubs with which you compete. Most likely, your direct competitors will be nightclubs located close to your location.
For each such competitor, provide an overview of their businesses and document their strengths and weaknesses. Unless you once worked at your competitors’ businesses, it will be impossible to know everything about them. But you should be able to find out key things about them such as:
- What types of customers do they serve?
- What products/services do they offer?
- What is their pricing (premium, low, etc.)?
- What are they good at?
- What are their weaknesses?
With regards to the last two questions, think about your answers from the customers’ perspective.
The final part of your competitive analysis section is to document your areas of competitive advantage. For example:
- Will you provide a superior nightclub setting?
- Will you provide products and services that your competitors don’t offer?
- Will you make it easier or faster for customers to gain entry into the nightclub (e.g., use of technology)?
- Will you provide better customer service?
- Will you offer better pricing? Or will you charge premium prices to attract a more upscale crowd?
Think about ways you will outperform your competition and document them in this section of your plan.