TOOLS FOR GROWTH

    Finding Our Niche

    Posted by Tim Johnson on Feb 3, 2017 10:32:25 AM

    NicheInfographic.pngTo put it plainly, finding our niche is nothing more than finding a product or service that we provide better or cheaper (or both) than anyone else.  As in the infographic to the right, the best area to be is in the far upper-right quadrant for the best profitability. To do this, we need a product or service that is both unique and offers good value to our customers. The second-best area to be is the lower-right, where we may offer the same product as our competition, but we provide the most value (best price). 

    We want to stay away from Bozos and Spam. A Bozo is something that is very unique, different than anything else, and at a great price, but nobody wants them. The only worst place to be is in the lower-left where we see the SPAM, this is the place where we have a product that is not unique and our price is higher than our competition (less value). Hitting our target, or at least near it, allows us the best opportunity to make the most money. If we find our niche, we can stay in that target quadrant.

    So how do we find our niche? The following business logic will help us determine our niche: embrace our passion, we can't please everyone, know our competition, and stay on track and change often. If you already know your niche, knowing this logic is still critical knowledge.

    Embrace Our Passion

    It is highly unlikely that we got into this business without a passion for the automotive industry, tools, or both. We shouldn't let the mundane daily tasks suck us into boredom and dislike. Wake up each morning being thankful for working in a career that allows us to fulfill your dream of doing what we love. Even better, why not make doing what we love very profitable as well.

    We need to find that unique piece that sucked us into this industry and grab hold with the ferocity of a pit bull. Maybe it was growing up with your Dad racing, maybe it was a high school friend that introduced you to hot rodding, or maybe it was just naturally in your blood. Regardless, if you loved it then, love it now! This embrace of Your passion will be the fuel that carries you through, regardless of circumstances.

    We Can't Please Everyone

    We should listen to our customers, but we can't let their selfish desires, useless to our business, convince us of stupid choices. Pretty blunt, I know, but we have to look out for it. Just because we sell beef jerky doesn't mean we should stock milk and eggs, even if our largest customer thinks it's a great idea. Selfish and needy customers will always be selfish and needy. It may be best to fire that customer and look for another.

    Know Our Competition

    1. Who are the competition?
    2. Where are they located?
    3. What products and services do they offer?
    4. How do they price their goods and services?
    5. What do their customers think of them?
    6. What do their vendors think of them?

    We have to identify, understand and target our competition. We can't pretend that the competition does not exist. Know who they are, write them down and put the list on the wall. Keep the list current and never underestimate them. Most of all, don't ever let them steal the passion.

    Understand where they are located. Do we have a geographical advantage or disadvantage? Remember, we are trying to find out niche, and the answers to these questions can help us target our niche. What products and services do they offer? We should differentiate the products we offer, we can always something faster and/or better.

    How are their prices? Maybe we can offer the same products cheaper. Remember that customers aren't really after the cheapest price, they want the greatest value. Our prices don't have to be the cheapest if the services we offer around said products offer greater value. Don't forget to sell this value and remind your customers of this value.

    Lastly, what do our competitor's customers and vendors think of them? This information is not that hard to find anymore, especially with social media. Many times, customers are very frustrated with a vendor, but they think that every vendor is the same. These are easy customers to win. Step in and be the rider on the white horse to save the day. Continue to offer stellar value to that customer.  Many times, being a better customer to our vendors will give us an edge on the competition. Is the competition slow to pay vendors? Can we pay cash or N/15 to get a better price? Don't forget that keeping vendors happy is often as important as keeping customers happy.

    Stay On Track and Change Often

    Stay on track offering the good and services that set us apart AND we do well. We have to be careful  not to spend a lot of time, money and effort on areas we're not the best. Once we find out what works, we must have laser-focus and stick-to-it-iveness. We can't let distractions detour our locomotive freight-train moving forward, as we gain momentum. Soon, with this same focus, our freight-train will become a 400mph maglev train.

     

    Not contrary to staying on track is to change often. Keep an eye out and understand when and where a change is needed. Especially, in inventory, be sure to keep new and fresh inventory in place. This too can differentiate us from the competition. We should keep in touch with our vendors to ensure we are the first to debut new tools, so our customers know where to come to see the latest and greatest. With customer feedback, we'll soon know those that work and don't work. Tap into vendors and manufacturers to help with keeping our customers' interests. Offer lunch and learns or Friday donuts...expensed to the vendor or manufacturer many times...while showing new tools or services that are offered.

    Wrap Up

    Remember always to have fun and enjoy the luxury of doing what we love. Our passion brought us into this, so use that same passion to fuel the engine that motors us past the mundane. Finding our niche is the key to maximizing profits, so we make more money while doing what we love. Don't make this difficult, because it doesn't have to be. Make sure to tap into vendors and customers for needed information, but we can't let them detract us from the goal. Let's enjoy the ramp up to our target and leave behind the spam-eating bozos.

    Topics: Tools for Growth

    SeedsOfGrowth.jpgAbout this Blog

    ISN is North America's largest automotive tool distributor.

    Over the course of the last 25 years, we have developed a core competency around keeping things simple and making work easier for our customers. That ability to make doing business easy requires sophisticated logistics, proprietary technology, strategically placed warehouses, and unique systems built from experience.  Through our series, Tools for Growth, we will be sharing tried and true tips that have helped us grow our customers' businesses exponentially.

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