The 5 Cs Every Entrepreneur Must Consider

To achieve success, you need a clear view of your business landscape. Here's an easy way to get that view

Written by David Kincaid

Imagine you were to wake up one morning in a business wilderness. You know where you want to go: to those highlands of profitability shown by the red X on the map you drew as part of your business plan. But a dense forest is blocking your view, making it unclear where you are right now. You can hear the roar of suppliers, competitors, employees and shareholders, and they seem to be getting closer. But you’re not sure if they are threats or enablers to you. You know that to reach your objective, you need to forge a path through the forest towards it. But in which direction?

That’s what it’s like for business leaders who haven’t completed a thorough assessment of their branded business. Without knowing where your company and brand stand today, it’s extremely difficult to know what your next move should be and where you should allocate your resources to achieve success. Should you invest in a stronger supply chain or in marketing? In HR or IT? Should you focus on your current market or expand into new categories and geographies? Respond in kind to competitors or ignore them and blaze your own path? Which choice will best drive revenue and enhance profitability given the environment in which you’re operating? And in today’s world, we know the answers to these questions can change at the drop of a hat.

Whether you run an established business or a startup, a situational assessment is one of the best things you can do to set yourself up for success. It provides you with the insight you need to make the best decisions affecting your brand health (the strength of your brand) and wealth (the value of your brand), now and into the future. Without this insight, your company could face lethal challenges—just look at what happened to Eaton’s, Blockbuster, Kodak and Polaroid. In each case, a lack of insight about the company’s existing situation and the major influences on it helped lead to the brand’s business demise.

I know the term “situational assessment” sounds abstract and complicated. But in practice, companies of any size can easily do such an assessment, using what I call “the 5 Cs.” Each C represents one of the five main areas you need to explore to understand your company’s current situation: your Category, Competition, Customers, Consumers and Company.

Let’s look at each in more detail to understand exactly what you need to know in order to drive your company’s success.


This C covers everything that impacts the category or industry you operate in—the major factors that influence its growth and direction. It also provides the opportunity to clearly define the category you’re in—which is vitally important but often overlooked.

From a brand health and wealth perspective, the top three questions you and your management team need to answer include:

  • What is driving the growth or decline of my category and its value?
  • Which trends (economic, political, technological, social/cultural, etc.) are influencing or changing this category?
  • What are the rules or assumptions the category is based on that can be applied or challenged to create competitive advantage?


This C may seem self-evident, but the questions you should be answering may not:

  • How are our competitors positioning themselves and aligning their operating models to leverage that positioning?
  • What strengths do they have that can be turned into weaknesses?
  • How do our competitors make money, and does it differ from our business model?


This refers to any stakeholder or company you partner with, including any channel you sell through or deal with that isn’t the end-user of your product or service. Distributors, suppliers and other vendors—even governments and regulators—all count as customers. The key questions you should be asking about them include:

  • How would we rate the health and productivity of our relationship with each of them? Could it change in the future?
  • How are our customers performing in their categories and what does their future look like? Will they be around for the long term or is their future in doubt?
  • How exactly do they bring value to our company and is that truly additive to our business—and vice versa?


Consumers are the people or businesses that actually use and see benefit (value) from your products or services. For packaged goods, the person buying your product is the consumer, while the store selling your product would be the customer. The questions you need to ask yourself about consumers include:

  • What are the different segments that exist, and which one(s) are we currently targeting?
  • What is the ideal brand experience, what are the unmet needs of our consumers and are we delivering on them?
  • What is the value of the different segments, and how much are they spending with us? Are we targeting the right one(s) in terms of growth and profitability?


This final C refers to your own company. It includes the internal barriers, enablers and financial drivers that exist and influence the way you operate, the state of your brand and culture, and your decision-making processes and habits. It often provides the most information and insight because the information is yours and largely within your control.

This C is also often the most impactful on the company. In my firm’s experience in conducting this exercise for hundreds of clients, we’ve found that more than 60% of the biggest challenges and opportunities for a company lie within it. The key insights here revolve around knowing:

  • How are we positioning our brand in the market? Is it engaging consumers to generate trial and loyalty?
  • What value or benefits do we offer our customers and consumers?
  • What are the defining characteristics of our culture, and are they aligned with our brand and objectives?
  • How do we make money, and what is our current return on investment?
  • What metrics do we use to measure success?

The insight collected by conducting a 5 Cs assessment is invaluable, and improving your understanding of your company’s current situation is the first step in setting yourself up for success. It allows you to see where on the map you currently stand so that, in knowing where you want to go, you can make the best decisions on how to get there as profitably and quickly as possible.

In my next column, I’ll present an example of how a major retailer I’ve worked with used the 5 Cs to achieve enhanced brand growth and profitability.

David Kincaid has been a leader of branded businesses for 35 years and is now managing partner and CEO of LEVEL5 Strategy Group, a Toronto-based firm dedicated to driving profitable growth for its clients through the power of their brand. LEVEL5 was on the 2010 and 2011 PROFIT 200 rankings of Canada’s Fastest-Growing Companies.

More columns by David Kincaid

Originally appeared on PROFITguide.com