How Your Small Business Should Handle Copycats Competitors

I remember my high school teacher telling us that plagiarism was a crime if you copied a report from the Internet or used someone else's work.

When it comes to school reports, it is pretty obvious when someone copies you. In business, this is not always true. And even though there are many instances of copying, it's still up for debate whether or not it's legal.

It can be pretty obvious. Sometimes, a copycat is someone who takes your idea and puts their own spin (and may even do it better). You have to decide how you're going to handle copycats, whether they are stealing your ideas or becoming a legitimate competitor.

Be flattered first, then go through a legal check list

Your first reaction will probably be anger when you see someone stealing your idea. You've spent years developing it, and someone is now just copying it. This can be very frustrating. You should be flattered. Imagine: "Wow! Someone thinks that we are successful enough to be copied? "I should be congratulated."

If someone copies you, then be proud.

After you congratulate yourself, make a mental check to see if there are any laws being broken. Check if your trademarks, copyrighted graphics or text that you have filed are being used. You don't need to contact an attorney yet. Check to see if your competitors are violating any trade dress laws. This is when their products look similar enough to yours that they could confuse a customer.

A competitor copied my company's website in the beginning. The copy was so lazily done that they even used the word "Trainual" a few times. We contacted an attorney and sent a cease and desist notice. If someone is copying your work, it's best to contact an attorney.

Does your copycat do a good enough job?

I remember years ago, a friend came back from New York with a bunch bootleg VHS cassettes he bought on Canal Street - tapes that had been recorded by someone sitting in a movie theater. The tapes were terrible -- people were walking in front the camera, there were blurry images. They were almost unwatchable. It's not like I would have skipped a movie at the cinema because I had watched bootlegs.

The same is true in business. If a competitor is a bootleg version of your company, you shouldn't worry. It's obvious that the competitor who copied out entire website no longer exists. When a copycat attempts to sell a low-quality imitation, there is nothing to be concerned about.

Sometimes there are reasons to be concerned. What if the copycat does a good job of it? What if your copycat is doing a good job? You've now got some real competition. Consider: How will you compete with them in the future.

Set yourself apart through a strategic approach

Jeff Bezos said that if we could keep our competitors focused on us, while we focus on customers, we would be okay. If you worry about copycat competitors, you will end up doing the same thing as them. Focus on what your customers want instead. By doing this, you will set yourself apart from those who are most important.

Southwest Airlines is a good example. They had to compete in a very competitive industry when they first started out. They wanted to be a low-cost airline and looked for people who were looking to travel as quickly as possible.

Southwest did this by making all seats on every plane identical, so they could easily swap people off flights and didn't have to assign any seats. Southwest was the only airline to not charge change fees. Southwest's low cost carrier strategy works well with this tactic, which has led to a hugely loyal customer base.

Southwest's open-seating model is not something that other carriers could copy, even if it was better liked. Southwest's strategy doesn't allow it to sell all seats the same way, so customers who want an "efficient trip" will fly with them. Southwest didn't focus on what other airlines did, but on what its customers wanted. It paid off.

Copycats won't be able to keep up with you if you build your strategy around what your customers want. They'll never know what your next move is. Your customers will eventually recognize you as an original. If your copycats do not differentiate themselves, then they won't last very long.