New IDEA of Small Business
After the rush of a small-business launch and the initial influx of curious customers, many small businesses reach a plateau. The proprietors are busy working hard to sustain the business doing what they've always done because it's worked so far, but this approach often means the business acquires and retains a certain customer base and sales volume and then "hits a wall".
Any business, but particularly a small business, must constantly adapt to changing market conditions, new business tools, and new sales opportunities to continue to grow and prosper. The small business owner must have one eye on routine operational tasks and one eye scanning the horizon for new opportunities. In this article we will discuss 10 breakout ideas for small businesses looking for growth opportunities. (Don't have your own business yet? Check out Start Your Own Small Business.)
Idea No. 1 - Add Complementary Products and Services
A great way to increase sales and bring new customers to your sales base is adding new complementary products and services. But how do you decide what to add without turning your business into a third-rate Wal-Mart? A great place to start is by reviewing the definition of your business. For example, if you sell house siding, ask yourself, are you in the siding business or the exterior building materials business? The result may be that you redefine your business and add gutters and downspouts, roofing and other coverings to your product line.
Another surprisingly simple way to build a list of new products or services is to ask your customers what else they might buy from you if your business sold it. A few friendly conversations with customers and staff will likely get you more information than thousands of dollars spent on professional customer surveys. Be sure to ask how much they would want to buy and how often to get a sense of whether the demand would be great enough to warrant the additional costs of building up this area of your business. (To learn how to build your network, read Small Business: It's All About Relationships.)
Idea No. 2 - Explore New Market Niches
One way to find a new market niche is to seek alternative applications for your existing products and services, and we have a Cheez-y example of how this works. Kraft started out with a spreadable cheese product in a jar that could be spread on crackers for snacks - it was called Cheez Whiz. This was fine, but selling a cracker topping will only take you so far in this world. That's why Kraft expanded the scope of Cheez Whiz and started promoting it as a base for a variety of dips and food toppings. Soon Cheez Whiz was an ingredient in all sorts of recipes. Kraft wasn't satisfied with only human consumption though. One of the latest unique uses of Cheez Whiz comes from a California fishing lure and bait company that sells Cheez Whiz in a prepackaged bait application, and it buys Cheez Whiz in 55 gallon drums.
If Kraft had stuck with the spreadable-cheese concept, sure, it would have covered a lot of crackers. But by thinking outside of its original intent, Kraft expanded the market and attracted customers it never would have targeted initially.
Idea No. 3 - Find an Unmet Need in your Industry and Fill It
When you talk to your customers and clients, listen closely for this phrase: "If only they made/sold X". Your job as a business is to find out what X is and provide it. It sounds obvious, but customers will tell you what they want if you will only take the time to listen. And the good news is that if you can find a way to fill that need, breakout sales are virtually guaranteed.
Take, for example, the local lumber yard that feels the heat as big box retailers muscle their way into the lumber business. There's no way the smaller outfit can compete with the large volume and low prices of the big boxes. Instead the owner listens to his customers who tell him that the big chain stores lack custom or hard-to-find millwork and hardware. This is an unmet need just waiting to be filled, and it could bring a new client base of suburban do-it-yourselfers who want to buy their unique weekend needs all in one place. (For more tips on getting through tough times, check out Build Your Small Business During Downswings and Tips For Boosting Your Business.)
Idea No. 4 - Use Internet and Catalog Sales Tools
If you are reading this article, you're no doubt aware that that the internet has more to offer than photos of pets dressed up like humans ... or humans dressed up like pets.
Many small businesses limit their sales reach and distribution to on-site, over-the-counter sales, but ecommerce can enhance your market reach, customer base and sales volume. Rather than the standard brick-and-mortar sales front, consider selling from a website, from an online storefront, a blog or from a printed catalog. (For related reading, try Choosing The Winners In The Click-And-Mortar Game.)
Idea No. 5 - Let Others Sell Your Private-Label Products
By allowing distributors, wholesalers, big box stores and competitors to sell your products under their own label (also known as a white label product), you may be able to realize the benefits of increased production volume, including reduced unit cost, increased fixed-cost amortization possibilities, and increased sales revenue, all of which can bring significant bottom line growth to a small business.
Idea No. 6 - Build A Better Mousetrap - Or At Least Buy One
We're all aware of the "build a better mousetrap" strategy as a breakout technique, but many small business owners don't know how to find technological innovations, patented products and processes in their industry, or how to license needed new technologies. There are a number of proprietary property licensing firms servicing companies of all sizes. These are easily found online if you search for "Technology Licensing".
There are two types of licensing (in-licensing and out-licensing) and not all firms handle both types. In-licensing involves searching for a particular tech innovation to make a better or different product, or a technique to make it at a lower cost. In this instance you would ask a proprietary licensing firm to search and acquire a license for your business to acquire the needed, and usually protected, technology. Conversely, if your firm has developed and patented proprietary technology that you want to license to others, an out-license firm will search for businesses interested in buying a license for the technology or innovation from your firm for their own use.