In business focus is everything. And the challenge is this – business owners are very attracted to shiny objects! They are creative, often marketing and sales focussed, and they love new ideas to generate money.
Entrepreneurs Love New Things
To tell an entrepreneur to limit their business to one thing is like telling a drunkard to have one glass a wine a week.
Yet…yet…creating a niche can truly make you rich. Get so good at one thing that no one else is good at and bada boom bada bing people will look to you as THE EXPERT in their industry.
A niche can be carved out of the marketplace in a number of ways. Here are 3 main ones:
- By industry type – think of an accounting firm specializing in food and beverage
- By skill-set – we are outsourced cloud accounting experts, and that’s all we do
- By income category – think a lawyer specializing in high-net-worth clients
By the way, a geographic area is not a niche – you may have lots of competition in your area, and nothing that sets you apart from them.
Do Two Trades Well and You Are a Master
Here is a quote I read recently in a Blog:
“The best business advice I ever received was: ‘Knowing one trade is great! Knowing two trades will set you apart.’ Knowing how to connect two trades and make sense of both (i.e. accounting and the cloud) – you will become irreplaceable. And the clients do see the value and are grateful” – Jelena Arkula
Here is another thought to ponder – imagine taking 2 skills as above (accounting and managing software in the cloud) and then applying it to ONE industry! You would be beyond irreplaceable – you would be indispensable.
An Example in Accounting
Let me use an example from our business. We are very, very focused on one thing – outsourced online controllership including bookkeeping.
We are experts in two separate areas – controllership (decades of experience), and cloud-based software.
We are also developing significant expertise in inventory management using a particularly powerful online cloud-based software platform.
Accounting firms that do online bookkeeping are at a disadvantage because they also do year-end financials, corporate and personal tax returns and even financial planning in some cases. So, their operations are not streamlined.
In addition, very few accounting firms have fully embraced the cloud as a software platform for accounting. They are still using traditional desktop accounting software.
Now, when you add the 3rd ingredient to the mix, a unique, specialized software for a particular industry and you have a triple-loaded powerful niche.
Pick What You Love
When you choose a niche for yourself, think of something you are good at, and more importantly, LOVE to do. The worst thing to do is become strategic and only create a niche that you think will make you money. It won’t make you happy.
If you enjoy your niche to the point that you would do it without pay, then you know what niche to choose!
I remember a few months ago working 16 hour days from early morning to evening setting up an online integration with the inventory management system we use and loving it! I wasn’t paid for a lot of that time, and it didn’t matter, I just enjoyed doing it so much.
The other thing to consider is clearly pick a niche that is a growing one and can pay you for your services. You don’t want to specialize in an industry that is dying out.
Pick a Niche That Is Growing
Again, using our own business as an example, we have a lot of expertise in online inventory management systems synced to online order systems like Shopify and Woo Commerce. This specialization is not limited to one industry.
Any business with inventory can use our systems, and that includes warehouse type businesses with lots of stuff they stock, food processors, breweries, coffee roasters, coffee distributors, wineries and much more. We are not locked into any one industry per se since we are mastering inventory systems.
Another key advantage to having a well-defined niche is that you stream-line your processes and systems. Everyone in your company will get better and better in the area of expertise you specialize in, so it is easier to train people.
And, most critically, your clients will pay you for this unique expertise, knowing you are the best in class at what you do and that it is so laser-focussed on them. You will have created a very customer-centric business.
My challenge questions to you are as follows:
- What are you really, really good at?
- What do you love to do?
- What are you doing that you aren’t really expert at? (get rid of it)
- What are customers eager to pay for? (i.e. what are their pain points)
- Based on the above questions, how many divisions/products/services do you have that you could get rid of and streamline operations?
Thanks for reading…