I spy

Entrepreneur, June, 1999 by Melissa Campanelli

Want to learn more about your competitors? Try using competitive intelligence resources.

Imagine this: You've just spent thousands of dollars researching and developing a new product, and you're about to launch it. Suddenly, you learn from a colleague that your main competitor is about to introduce a similar product a few days before your launch. You know what you have to do: Find out everything you can about the company, whether the product is in its rollout stage and how much it's selling for - then prepare your troops for a counterattack.

One of the best ways to gather the information you need is through online competitive intelligence, the aggressive but legal practice of surfing the Internet for information about your competitors. While seeking information about the competition is a timeworn practice, the Internet is making the process much easier.

"The Internet lets you learn your enemies' plans ahead of time," says Richard Combs, president of Richard Combs Associates (www.combsinc.com), a competitive intelligence consulting firm in Chicago. He's also co-author of The Competitive Intelligence Handbook (University Press of America). "And when you know this information, you're way down the pike."

GETTING THE SKINNY

Many low-cost or free online sources such as the following can help you get up to speed on your competition:

* The EDGAR database (www.sec.gov): The U.S. Security and Exchange Commission's Electronic Data Gathering, Analysis and Retrieval system provides information such as annual and quarterly reports, proxies, and insider trading filings for all public U.S. companies that have filed with the SEC since January 1994.

* Hoovers Online (www.hoovers.com): This handy source from Hoovers, a provider of business information and corporate profiles, offers free basic information (such as names, addresses and elementary financial data) about companies, and links to further information on 13,500 large U.S. and international companies. For $14.95 per month, subscribers can also access information, including company histories, strategies, market positions and major events, on more than 3,500 of the largest and fastest-growing companies. In addition, subscribers can get even more in-depth financial information on approximately 8,000 public companies, including detailed market and industry comparison data; annual, quarterly and historical financials; and links to real-time SEC filings, provided by the EDGAR database.

* CompaniesOnline (www.companiesonline.com): Managed by Dun & Bradsteet, this site provides information on more than 100,000 U.S. companies, including their postal addresses, LVRLs, phone numbers, contact names and titles, sales volumes and numbers of employees. CompaniesOnline charges various fees for more enhanced research. A $20 D&B Business Background Report, for example, will provide you with useful information on a company's history and operations background, as well as recent news items about the company.

* Biz@dvantage (www.biz.n2K.com): WinStar Telebase Inc. operates this site, which provides financial and credit data from Dun & Bradstreet and easy access to business news wires, the Thomas Register of American Manufacturers Online and other resources. Registration is free, but each report or news article costs from 50 cents to $360, depending on the report's detail.

* Lexis-Nexis (www.lexis-nexis.com): The world's largest source of legal, business and government information now offers affordable services over the Internet. For less than $200 per month, users get information from thousands of newspapers, magazines and industry publications, as well as financial data, public and legislative records, and data on companies and executives.

* Company Sleuth (www.companysleuth.com): This free tracking service from Infonautics Inc. will follow insider stock sales; posts on Yahoo!, Motley Fool and Usenet message boards; SEC filings; earnings estimates; financial reports; news items and more on up to 10 companies for you. You'll receive daily e-mail reports as well as "scoop alerts" when big news breaks about your selected companies. Currently, Company Sleuth tracks only public companies, but it plans to add private businesses shortly, as well as a fee-based service that offers more detailed information.

* The Background Check (www.knowx.com): Provided by KnowX, an information resource company, this service allows users to search for bankruptcies, lawsuits, liens, judgments and other events in companies' histories. For $1 to $5 per database, you can receive a list of matches. Details on particular matches will cost you from $6.95 to $15.

DO IT YOUR WAY

An alternative to using the competitive intelligence resources listed above is to visit your competitors' Web sites or use a standard search engine to find information.

HotBot (www.hotbot.com) is a useful search engine for competitive intelligence. While it doesn't have the largest database, it does have Boolean search capabilities - meaning you can type in the words "and," "or" or "not" to refine a search and receive more relevant information about your competitors.