There’s an army of books written on the subject of how a business should sustain its competitive edge. But I can’t help but jump in on the dialogue in light of the fact that Lowe’s closed 20 stores and The Gap closed 200 of its 889 stores. 889 stores! If you do the math, that is just about 18 stores per state. Given that some states are geographically bigger than others, that’s a fair concentration of blue jeans and tee shirts. Add into the mix competitors that sell like-minded merchandise, and you can imagine the challenge of trying to sustain a competitive edge. As for Lowe’s, it can either look down the street for itself or for its clone, Home Depot. Is the world big enough for the two?

When you have a business that sells a commodity or good that on its own, is equal, what makes the difference?

Ah...you have to create the difference. The competitive differential can spell success or failure for a business.

The following lists the strategies employed that can make The Competitive Difference:

1. Being the first. But just because you invented or offered a product first, doesn’t guarantee you the number one position for life. You can’t rest on your laurels. You have to stay sharp at your game. Here’s an example from my personal experience: In the 1980s, I co-founded a high-end national specialty retail company that offered a unique product and merchandised it to appeal to the masses. I actually created an industry from the idea. The product was an originally signed/written historical document by famous, important people of history such as American presidents, classical composers, vintage sports personages and the like. We took these papers and researched, preserved and framed them as tasteful works of art. Initially, we sold them in gallery settings in high-end malls throughout the country. Nobody had the depth of our inventory and nobody did it better. We enjoyed riding the curve of being the first for five years before competition set in. We employed the following steps to counter the pitfalls of being the first:
   
2. If you are the first, build a brand and customer loyalty. They are great protection when competition arrives. So if you are the first, invest in your future by establishing why someone should buy from you versus your competitor, all other things being equal. Factors like the following weigh into the mix:
   
   
   • Honor your Customer
   • Customer Service
   • Relationship-building with your clients
   • Loyalty incentives to build long-standing relationships
     
3. Innovate. What is it that you can do to improve your existing product so that you can expand your customer base or up sell to your existing base. In my former business, we introduced alternative ways of presentation such as folios and building themed furniture for our products. Later we introduced different portals/channels for distributing our product such as home shopping television, catalog and having an online store. Lowe’s launched a personalized website called, “My Lowe’s,” an online tool that helps the customer track their home improvement project. Clearly a service-oriented strategy that tries to distinguish itself from Home Depot. We’ll see if it works to Lowe’s advantage.
   
4. Dance the delicate dance of expansion for market share. I crafted the description of this strategy with carefully selected words because if a company expands, just for the sake of market share without a respect to basic financial fundamentals, the strategy will blow up in its face. These store closings more often than not reflect under performing stores---typical of when you locate to a competitively dense area, and especially so when you have a duplicate or three of your own stores in a close radius. This is known as cannibalizing your brand. What may make better sense is expanding to emerging markets. For example, although The Gap closed stores here, it has aggressive plans for expanding to China. Many U.S. retailers are looking globally for leveraging their competitive differential rather than cannibalizing themselves by over expanding here.
   

What do you think?
So...tell me what companies you think have done a good job at sustaining their competitive edge and why. It may be as simple as they impress you as a customer by their service and how they keep up on improving their products.