COMPETITIVE ADVANTAGE
What will give your business
the edge?

Competitive advantage - This next step of the internal analysis is a vital step in writing a business plan. If you analyse (by using the VRIO method below) what you have written regarding your resources, skills, capabilities, experience etc. you should start to see what strengths you have and what will therefore give you a competitive edge in your business.

It is very important to find out what will give you an advantage over your competitors or at the very lease it will highlight what you need to achieve to get that all important competitive edge.

VRIO

Question	Valuable	Rare	Imitate	Organisation
Strength 1	Yes	Yes	Yes	Yes
Strength 2	Yes	Yes	No	-
Strength 3	No	-	-	-
Strength 4	Yes	Yes	Yes	No

In the first column list your strengths that you identified previously (skills, capabilities etc). Which are your main strengths? Then ask the following questions for each strength:

Valuable: Is it valuable for future business?Rare: Are you the only business that has this strength?Imitate: Is it costly or difficult to imitate?Organisation: Is the business organised in a way that allows the strength to be exploited to its full potential?

For each strength if you answer yes to the first question, tick this box and go onto the next questions and answer yes or no. if you ever answer ‘no’ do not progress through the other questions, go to your next strength.

If you can answer ‘yes’ to all four questions on any one strength, that is your sustainable competitive edge.

Under the above table, write down what your competitive edges are. Do NOT be despondent if you do not have an advantage looking at your skills and capabilities. Think about how you will develop your competitive edge and write this down instead.