Writing your marketing plan begins with knowing your own company—but it’s just as important to know the competition.

After you thoroughly study your top competitors, you’ll be able to put together an analysis that details each one’s strengths and weaknesses and how your company compares. Use what you uncover to avoid competitors’ mistakes and to model what they’re doing right.

Who are your competitors? There may be more than you realize. If you run a video-rental store, other such shops are direct competitors—but so are other businesses that compete for your customers’ time and entertainment dollars. What customer needs are you trying to satisfy, and who else is also filling those needs?

If you’re not sure who all your competitors are, check the yellow pages, ask friends and acquaintances, do Internet searches and check out trade magazines. It’s crucial that you find out who the top dogs are so you can differentiate yourself. Focus initially on the handful of competitors who have the most potential customers to offer.

Get the skinny on your competitors by visiting their shops. Surf their Web sites as well as sites where consumers discuss their purchasing experiences. Read articles about industry competitors in trade magazines. Check out their annual reports, ads, brochures and trade-show displays. Create a file on each company and add to it as a form of ongoing research.

Join your chamber of commerce and get to know the people running rival companies. Learn from others in your community or industry through networking and trade groups.

Once you’ve narrowed down the list of significant competitors, the goal is to figure out how good a job each one is doing. Analyze and list each competitor’s strengths—the things you’d like to imitate—as well as weaknesses you feel you can improve on. Can you offer speedier service, lower prices, more helpful salespeople, greater technical expertise, better flavors, a cleaner shop?

Scour Better Business Bureau Web sites to see what kinds of complaints, if any, have been lodged against your competitors. Try to determine what people like and dislike about them, and use that knowledge to position your company.

While you’re checking out your rivals, think through other challenges that could also affect your business. How will you cope with evolving technologies in your industry, changing demographics in your neighborhood and economic uncertainties?

Look for ways to turn competition and other difficulties into opportunity. If locals are buying more and more books through Internet stores because of the vast range of titles they offer, for example, stress the fact that you can special-order any title for customers and that they won’t have to pay for shipping.