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Kobus Engelbrecht, Marketing Head: Sanlam Business Market, says it was no surprise that Phake was named the winner of the Small Business category in the 2017 Entrepreneur of the Year competition, sponsored by Sanlam and Business Partners. “What impressed the judges was the fact that he has learnt never to be complacent and that, in spite of his success, he remains acutely aware of his competition.”

As a young maverick and the first black player in the space, Phake is seeking to disrupt the South African stereotype of fitness training only being accessible to the wealthy. He analysed the big players and saw a market gap for a scalable corporate-focused model that provides a fully operational fitness facility for employees. Phake’s business already supports 50 staff members, with 13 fully-equipped gyms across the country in various universities, government institutes and corporates. He says his long-term plan is African expansion and to list the company on the JSE.

Below Phake provides insight to aspiring entrepreneurs on how he managed to successfully fill a gap in a very dominant market.

How I Identified a Gap for a New Fitness Model

South Africa has a relatively well-developed health club industry, with two or three prominent chains standing out. Zenzele was partly started because we spotted an opportunity to service a larger percentage of the population. Established health club brands predominantly cater for high to middle income parts of the population, ignoring ‘the man on the street’. The opportunity to set up corporate and university health clubs was the perfect chance to not only offer a full turnkey key solution for the corporate or university, but to also create convenience and provide a service that is affordable.

I Deviated from the Norm to Blindside the Competition

We have three health clubs at a brewery, which predominantly comprises a blue-collar workforce who would not ordinarily be able to afford high subscription fees for a gym membership. We’ve built a world-class facility that looks and feels like something you’d find anywhere in the world, at an affordable price.

Capitalising the Gap

We are currently on a very strong capital raising drive in order to build a scalable footprint in the market. Our business scope is focused on growth and should see us running over 50 clubs across Africa in the next three to five years.

Look Beyond the Obvious

Your unique selling proposition is what will set you apart from your competitors. Always remember that great businesses with resilience and longevity are those that serve society by answering a need. Make sure you fully understand what need you are catering for and if the customer is willing to pay for the solution you are providing.

How I Intend to Stay Ahead of the Competition

By making sure we fully service our existing customers and retain them. We continuously ensure that we remain innovative with our offering and stay abreast with the market and world trends. This forms part of our competitor analysis, which we reappraise and adapt every year, if not more frequently.

Benchmarking Your Business Against Your Competitors

Kobus Engelbrecht says knowing your competitive landscape is key to ensure an understanding of how your targeted clientele responds to businesses with a similar offering and enables you to position your unique selling propositions (USPs) according to a market gap. Here are seven strategies to know the competition:

  1. Identify your main competitors: There is no one-fit formula for this; it is a case of knowing your industry and using all possible resources to extract information.
  2. Find out everything you can about the competition: Understand each competitor’s offering, benefits and USPs.
  3. Don’t underestimate industry newcomers: You run the risk of being blindsided if you have the mistaken belief that new players can’t and won’t disrupt your business.
  4. Take every opportunity to network: Networking is as much about identifying your competitors as it is about finding complementary ways to leverage off other people’s strengths and connections.
  5. If your competitor is outperforming your business, ask why: If you’re losing customers to the competition, take a deep look at your business strategy from a client’s perspective and ask what barriers are preventing your growth.
  6. Make decisions that make sense for your business: While it is all very well to copy the competition, the decisions you make need to benefit your business. For example, a competitor’s pricing model may not work for you.
  7. Consider the industry you’re in: The industry you’re in plays a part in determining your competitive edge, but there are some general ways to boost all companies’ market visibility, including social media; a user-friendly, modern website and SEO strategy for improved Google rankings.
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