Starting a new business in a competitive industry

16 08 2007

I had a friend walk up to me last night after I was done playing pool another passion of mine. He has seen some of the previous consulting work I had done for other small business start ups and asked me a question I get alot. So I figured I’d share this because I’m sure some of my readers may be asking the same thing.I have this idea for a business that I know other people make money at what do I do?What are you doing differently then they are to separate yourself in the potential customers mind? In other words why are people going to choose you over your competition. He then gave me a little info on what business it is  and I gave him some example that he hadn’t thought of yet. A really great question I love to ask people to help them with this concept is the oppposite minded. What need is not being met by the businesses right now that you could fill? What is it that you see other companies NOT doing that you have a passion toward?I call it looking for the gaps and if you find a gap big enough you can have a amazing business. So often though people have such enthusiam for starting the new business which I commend. They don’t stop and ask if the need is already being met. So why be one of many when you can create a new alternative? Business that ask if what can they do better than those already out their are the one with people beating a path to their door.This is a tried and true concept of the USP unique selling point. Which you find out what makes you business unique even in a crowded industry. Your businesses “voice” is what potential customers are going to use to decide if they will do business with you or not let me give you a great example of what I mean.The other day I went out to rent the movie “Wild Hogs” at Blockbuster they wanted $4.50 for a two day rental I thought that was a little crazy and didn’t know if I could watch if that night so I walked out. Before I went home I stopped at Hollywood video and they had it same price and same movie but one BIG difference to me. They had a five day rental at $4.50 BUT if I was done with it tommorow and I bought it back that would credit $1 to my account. Instead of punishing me for not watching the movie fast enough  (the late fees at blockbuster) Hollywood video would REWARD me for getting it back to them sooner BUT I the customer was in control and didn’t have too (I could keep it for 5 days it’s only a buck). So now im changing my habits because of how I felt like the getting back the rental was more important to Blockbuster than me then customers EXPERIENCE. Hollywood gets the visits first and probrably the majority of my rental income because of this shift. I made my decision because of each businesses voice and what each was saying to me.

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