Start-up: March 2006 Archives

Tick Marks blogged about a great article at Accounting Web that clearly spells out five strategies that help a new professional service or consulting business take advantage of a niche market quickly and effectively. It actually has good insights for anyone looking to start a new business in a niche market.

Here are their five strategies for niche markets and my thoughts on each:

"Strategy One: Aim at one and only one niche at a time."

For years I have had a rather corny poster on my wall that has a picture of a golf hole that is one of those intimidating island greens. It has one word at the bottom: Focus. I have thought about putting it away each time I move into a new office, but time and time again I find that its message is important to reinforce with new entrepreneurs. Too often they forget the importance of keeping their eye on the competitive advantage of the niche they have discovered.

"Strategy Two: Craft a 'dynamite and irresistible' marketing message"

The best niche markets are those that have not yet been satisfied. Therefore, don't forget to get the word out to your customers that you are open and ready for business. Your message should tell them who you are, why you are worth their attention, and how you will take care of their needs. Find inexpensive, but effective ways to get in front of your market. Become a marketing bootstrapper.

"Strategy Three: Become the 'obvious expert' in your niche"

The key to this strategy is having a clear and compelling mission statement that has an obvious focus. The answer to the question "Tell me what you do," should take you no more than 15 seconds. You want your customers to become your sales force. You want them to say to others, "When I had the problem, I called __________."

"Strategy Four: Create a 'hit list' of your most desired 100 clients in your niche"

Your marketing plan should have you going for the low hanging fruit. Find the customers that need you the most and have the best chance of paying for what you offer.

"Strategy Five: Implement auto-pilot referral systems"

Word of mouth does not just happen. Make your customers want to refer clients because it makes them look good to do so. Find a simple and meaningful way to say thanks. It may have some monetary value, or may not. Hand written notes have become so uncommon that when you send one, it really can mean something to your customers.

There are many rankings that highlight certain states as being business friendly. Usually my adopted home state of Tennessee ranks fairly high. However, even within a business friendly state different cities can have very different business climates. A new study released by the Tennessee Center for Policy Research examines the differences in business climate in cities across this generally business friendly state.

For example, Franklin (where we live) is a suburb of Nashville. But where Franklin ranks near the top in terms of being business friendly, Nashville (where I work) is in the middle. In general, the middle and eastern parts of the state have the highest rankings, while the west has generally the lowest. And which city is at the bottom? Memphis, which has a political climate that has been dominated by anti-business types for generations.

So when looking for a location for your business, make sure to understand the business climate of that city. Look at local taxes, local business regulations, business amenities, and available work force. Moving just a few miles down the road can make a world of difference for you and your business.

(Thanks to Dean Larry Hall for passing this study along).