Every business has competition.
Business Model Generation (the book that introduced the Canvas) addresses the question of competition in its section on Strategy, but the Canvas includes no obvious place to include a competitive analysis.
In business planning, the competition is one of the key elements that needs to be addressed. The Purpose and Opportunity may fill you with excitement. The Financial Plan may reveal huge potential profits from a small investment. But if one or two or five other companies are providing the same Value Proposition to the same Customer Segments, using similar Channels and similar Revenue models, then the business may not be worth pursuing.
This is summed up in a few questions: How are your customers solving the problem today? How is your solution different? How will your solution continue to be chosen by customers once your competition sees it in the market?
The Next Step: A guide to pitching your idea includes a long description on how to answer, organize, and present the answers to these questions.
In my Business Presentation Pyramid, the Competition box is purposefully placed at the other corner, as it, too, is a cornerstone of the business planning process. Every startup has competition. At the very least, if there is no other company solving the problem, then often customers are solving the problem themselves or not finding that the problem is important enough to solve. Understanding customers’ attitudes toward the problem is important before spending the time and effort to start a company.
