I have been at this business thing a while now and these are thoughts and parts of conversations that began long before Coronavirus was ever on the radar; however now, they seem more relevant than ever. Is it possible to start a business and aspire to leveling off or is growth and expansion always the goal? I believe the latter is most often true. I have yet to meet an entrepreneur whose aspirations peaked at “just making it”. If you bring value to the marketplace, the desire isn’t world domination and the eradication of all competition, but the sense of accomplishment that comes from knowing that you are serving as many people as you can possibly reach with the value of your product or service. So, is it possible, in the throws and wake of COVID-19, for a valued product or service to expand (increase geographic opportunities to capture market share) and grow (capture increased market share within those geographic opportunity areas).
However, before you decide to do this in an unpredictable and volatile market, there are a few questions you must answer and answer confidently. I have listed them below. These are simple and you may remember these from your business management courses or a seminar or a weekend retreat. To answer these searching questions with conviction and proof has always been mandatory. They are more critical now than ever. Read them over and over. Study the answers for your next market. Restudy the answers … and step wisely. Here they are:
Location is not enough. There must be a proven demand in that market (geographic area). This is not the season to test a product or service in an untested market. If your product or service is the first of its kind in that market, consider that the buying consumer or client is apprehensive at best. In this climate, people will exchange less quality for guaranteed stability. They will most likely not step out to take a chance on a new solution. It is important to identify where the target customer or client is currently making purchases that are in your core competency. If you are to succeed in a market where you are the new offering on the block, remember that you will most likely be required to double, maybe triple, your marketing output, budget, and exposure. When you do identify a market that is responding to a similar product or service, you have at the very least, the assurance that you will be able to bring value to an already educated and actively buying market.
Next, identify the conditions that create a buying climate. This one typically takes more research to answer. Make no mistake, when you have successfully identified a market that has a buying climate for your product or service, there are conditions that are unique to that market which must be identified. It could be scarcity. It could be saturation. It could be a natural condition. It could be any number of things. Whatever it is, “it” must be identified. Identify the unique factors contributing to a buying climate and then … harness them like a race horse ready to run.
Available real estate? Cost prohibitive leases? Competition? I have seen so many well intentioned entrepreneurs start well and quit too soon with this question. Keep in mind, if expansion and growth are your mission, and you have answered the previous 2 questions thoroughly, this one is equally as important to your success. If the answer is high leases, employ the negotiation skills of someone who can achieve a win / win. They are out there. I have been successful at negotiating win / win leases for both tenant and landlord. It can be done. If the answer is competition, remember that unless there is enough population to service the existing competition AND a new competitor (you), then the market is a no-go. Know your craft. Know your trade. What is the average radius of service for your competitor? For your business? Ok - how many competitors are in the market? Is there enough target population to service all the offerings? Ensure there is room in the sand box for you AND your bucket and shovel. Otherwise, you will be starved for sand. Identify barriers and then, identify the means to overcome them.
Don’t be afraid of competition AND don’t be afraid to compete. On this last question, I will share a bit about me. I am 5’6”. Not a tall guy. But, I love basketball. I have since I was a child. I played 4 years in high school. I was ok then. I think I am a much wiser player now. When I took a job in south Philadelphia, it exposed me to the outdoor courts. Some days while driving through the city, I would see pick up games. If I had time, I would grab my sneakers out of the trunk and would join the game. Now keep in mind, the ballers in Philly are no joke. They could really play. Dunking, hanging on the rim, 3 point shots raining down, speed like lightning. I could have easily looked at the skill level on the court and kept driving by. But I didn’t. I learned more on those courts than any coach ever taught me. Here is the principle. Just because the court is full of players with more height, strength, maybe even skill, doesn’t mean you don’t lace up your sneakers. It simply means you play smarter. I found my place on those courts. You will find yours in the marketplace. Find your position on the court, lock arms with your teammates, and play smart first. Then, add the play hard. The way to win market share in your new target market is to bring what only you can to the table. What is that? It’s YOU. There may be many competitors in the area but there is only one you. You are the unique value proposition. You are the watershed moment.
COVID-19 may be around for a while. Social distancing will be part of our foreseeable future. Masks, gloves, and hand sanitizer may be the new normal. With these questions thoroughly answered, you can be confident to begin having discussion of expansion and growth.
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