Are There Riches In Niches

In the beginning, we all take whatever business we can get. But after a while, you can start to identify who you like working with, the types of work you do, where you’re more profitable, your ideal customer, ideal division, ideal service… Many worry that if they niche, they will lose out on business because they won’t reach as many people. But actually it’s often just the opposite. Remember, you often purchase materials for your jobs from different suppliers because the suppliers specialized. When you take the time to niche, you’ll find that it simplifies your business and increases your profitability. Here’s why:

It’s Easier

When you serve a niche, you will see the same customer challenges over and over again.  As you become good at identifying the challenges of your niche customers, you can anticipate their needs making it easier to estimate. There is less to learn, so you’ll also be able to focus on solutions specific to your audience, increasing your effectiveness, instead of not having the time because you’re serving such a diverse clientele.

You’ll Save Time   

When you are constantly dealing with similar customers, jobs and issues, you’ll find that not only is it easier, but you’ll be able to create a systematic process, streamlining your workflow.  Your employees will have less to learn and become more efficient in getting their work done. So “same old, same old” will equal savings in time.

You’ll Build a Better Reputation

As a result of this deeper knowledge that you’ve learned from serving multiple customers with similar needs, you will develop the reputation as the go-to for this particular type of service or for working with this type of customer.  That means better testimonials.  Not only will you develop a reputation, but it will develop faster within the niche than you would in the general world.  And that means your referrals will speed up!  You and a “competitor” may even refer to each other – I have QuickBooks consultants who refer work to me and vice versa.

You’ll Have Less Competition

When you specialize, it’s easier to stand out because there are fewer competitors!  Not only that, but think about when you look for a particular service.  Did you ever reach out to people in your industry association to find out who they used – someone who would “understand you”?  Your customers are happy to have someone who specializes in them!

It’s Easier to Market

It’s easier to market to a specific audience than the general audience.  You’re able to tell them what you do well that addresses their unique needs and wishes instead of the generic “we do quality work and are insured” you tell the general public.  Not that those aren’t important aspects of your business but when you can be more explicit, you’ll have better results. Marketing to a young family with kids and pets is different than marketing to retirees. Marketing to government agencies is different that marketing to consumers or commercial businesses.

You can Increase Your Profitability

Here’s why:

  • With better estimating, you’re less likely to underestimate, so you walk away with more profit.
  • When your employees are more efficient, your labor costs are down, so you increase your profit.
  • When your employees are more efficient, you can often get the work done faster and take on more jobs, so you increase your profits.
  • And because you specialize, you can often charge more. Remember, the specialist you visit charges more than your family doctor.

Depending on the size of your company or seasons, you may find you develop more than one niche.  The key, is having that niche defined making it easier to market, estimate and execute more effectively

So start thinking about how you can get a clearer picture of your idea customer, ideal job, preferred geography, etc.   Let us know if you would like assistance in getting some of that data from QuickBooks.

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