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A Niche Business Can Be Small AND Make You More Money

Updated: May 28

It is common for business leaders to underestimate what a small business in a narrow niche can do. This belief hinders the entrepreneur's vision for how good it could be. Consider if you would prefer making one million dollars from a 10 million dollar company or a 100 million dollar company. Think about it. The pay is the same, but the stress, exposure, and need for funding are multiplied by at least ten in the larger company. Likely, much more. Entrepreneurs widely believe in this myth that making a difference requires being large. Lesson: Underestimating what a small business can do in a narrow niche often hinders profitability. If you think you are too small to make a difference, try spending the night with a mosquito! Wallace was our "banana man." Arriving each day at 2:30 in the morning, he ensured that the ethylene gas and temperatures were suitable to perfect the green bananas we imported from Honduras. In twelve hours, check them again, and "kiss them goodnight." These fresh bananas, ready for delivery three times per week, allowed us to service a lucrative niche market in three states. Our service was unique. No one else would attempt this level of execution. Dominating this niche allowed us to maximize our profitability, which fueled our purpose. Lesson: Dominating a niche maximizes your profitability, which blesses your community and advances your purpose. It is a myth that you have to be big to make an impact. A niche business has many benefits. What are the benefits of a niche business? 1. Better margins A niche business provides for better margins. Focusing your resources on your niche gives you buying power. Zeroing in on Chiquita bananas allowed us to buy them by the truckloads when our competitors bought them by the pallet. Our margins and our customers' margins improved; everybody wins! 2. Funds your growth internally. Funding our growth allows us to expand without depending on outside capital. We make our own timely decisions. Having outside investors can rob you of needed decision-making authority at times when you need it most. Investors can sometimes negatively influence critical decisions, capital expenditures, and compensation if they do not have the same long-term view. 3. Monetizes a preferred lifestyle. A niche market makes you more money with less effort. It minimizes stress, requires fewer working hours, and gives you back control of your schedule. Your niche market allows you to build a deeper and broader moat around your castle. Divorce yourself from the myth that making an impact requires largess. Embrace the truth that the riches are indeed in the niches! Harry T. Jones P.S. Let me know where you are in starting, growing, or transitioning your business. I would love to address your struggle in a future post. I have created a form to facilitate our communication. CLICK HERE.

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