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Mar 29 / heathgross

10 Reasons Most Companies Don’t Know Jack About Their Competition

Do you know who your competition is?

Illustration by Cat Scott

Like many of my peers in the competitive intelligence community, I am a member of several competitive and market intelligence LinkedIn Groups. Recently I came across a discussion thread that summed up why …

Most Companies Don’t Know Jack About Their Competition!

A member of a particular group asked a very natural question that many folks new to competitive intelligence might want to know. The question:

“Does anyone know the best place to find company and financial information on a privately-held company? I have a budget and a tight deadline. Hoovers, One Source & D&B have nothing. Thanks.”

The responses to this question left me scratching my head. Below are ten of the responses:

  1. I would suggest checking the state records for which the company is incorporated. It varies and depends on state laws. Also, you may need to use the Freedom of Information Act to obtain access. In most cases, it is very difficult.

  2. I have used, Reference USA (from my public library) and Skyminder Information Services as good backup resources. If the company is large… has the top 200 privately held companies list.

  3. In Europe each individual country has a trade registry with some of the latter being public. Good access to the company’s official papers and financials.

  4. Here is a web site to get financial data about French private companies. It is a French website. Hope it helps.

  5. Check with Capital IQ for private company financials, particularly for US based companies. It’s a subscription based service.

  6. For all Private Equity/Venture Capital backed companies, Dow Jones VentureSource is the one place to look. It is a subscription based service. Otherwise, in Europe, country specific and free DB are great. For France, and For Germany,

  7. In Bulgaria full company trade registry history and financials for the last 4 years at Works only in Bulgarian.

  8. Orbis is a data source which provides company and financial info for all public companies.

  9. First check the secy of state filing to see what corp documents are available and then you can google the officers etc.

  10. I assume you checked your target’s website first of course

Secondary, secondary, secondary. Keep in mind this was a competitive intelligence LinkedIn Group, not market research. I am not suggesting that these recommendations are not valid; each of them has individual merit. What baffled me was that not one of my peers suggested primary research. As I have said many times before, the best way to get detailed information on a company is to pick up the phone and talk to someone!

Here are some questions you may be asking yourself…

But Isn’t Secondary Faster?

Perhaps no one suggested primary research because the member stated, “I have…a tight deadline”. It is true that primary research generally takes longer than secondary; however, in my experience it is possible to get primary intel within a very short time frame if one uses the right approach. Without knowing what was meant by “tight deadline” there was no way to know if the member had ten hours or ten days. Ten hours probably wouldn’t be enough, but generally ten days is plenty.

But Isn’t Secondary Cheaper?

What about the “I have a budget” issue? Maybe that is why no one suggested primary research; after all, isn’t primary research much more expensive? The answer: yes and no. It is true that some of the techniques mentioned in the responses are free. After doing some research of my own, I learned that all of the subscription based services mentioned (almost half of the responses) cost more than what we would charge for answering the same question. So, unless the member already has access to these secondary sources, primary research may actually be more cost effective.

What About Detail and Accuracy?

Primary research can generally provide far greater detail and with a higher rate of accuracy than secondary. Our research has demonstrated that the financial figures provided on companies via secondary sources can be off by as much as 200%!

We recently completed a company profile for a client in which we had only five days to perform the research. In five days, we were able to gather extremely detailed financial data that we were able to verify with the VP of Business Development. What is equally impressive is that we were able to do the study for less than $4,000. (Access our download center for a sanitized version of this report)

In Short

The reason most companies don’t know Jack about their competition is because if you limit your research to secondary, you will only know a) as much as everybody else and b) what your competitor wants you to know. In business, like in war, that is not the kind of intelligence you want to build a strategy on.

To those who are new to competitive intelligence, let me say this: Secondary research can be a great tool for gathering high level information quickly and efficiently, but it is important to understand that it comes with significant limitations. See The Four Disciplines Of Competitive Intelligence for more on this.

To my peers who are either consumers or providers of competitive intelligence: You can’t find everything online. The internet is great, but if you really want to get forward looking, hard-to-get intelligence, it’s time to put down the mouse and pick up the phone.

I’d love to hear from readers about what your experience has been with primary vs. secondary research, particularly around private companies.

Want to see how primary research can help you? Contact Sedulo Group for a free custom competitor profile.

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