From competition within the middle market to vying with larger competitors and new companies entering the market, middle-market business leaders are feeling the pinch of a heightened competitive environment, according to findings from the Grant Thornton Survey of Middle-Market Business Leaders.
Ninety-four percent cite competition as more intense or as intense as one year ago, while just 6 percent say the competitive environment is less intense.
"As the market has tightened, so, too, have the competitive pressures on middle-market companies," says John Desmond, partner in charge of the Business Leaders Council. "Companies, especially those in the middle market, are not only fighting for new business – often at lower margins – but many are also looking for new ways to keep the customers they have from taking their business to the competition."
Additional highlights from the survey include:
- Survey respondents cited a greater focus on price (89 percent), more knowledgeable customers (82 percent), and less client loyalty (81 percent) as the top business issues related to competition.
- Two-thirds (74 percent) of middle-market business leaders believe it is more important today for employees to understand what needs to be done for the company to succeed.
- To enhance employee alignment and motivation, 82 percent are focusing on consistent communications and 81 percent are establishing realistic expectations for employee performance.
- Fifty-two percent of respondents are taking immediate steps to better allocate resources by deselection – focusing exclusively on initiatives that will be most profitable.
- In preparation for an improved business climate, 84 percent of middle-market business leaders have — or plan to — invest in new technology (58 percent and 26 percent, respectively).
The Summer 2003 Survey of Middle-Market Business Leaders, with a special emphasis on how companies are positioning for an improved economy, is available from Grant Thornton.