This past Tuesday, we had lunch with a client who is a business owner. His business has been growing nicely over the last couple of years. As a result, he is understandably a little more sanguine about the economy than most of the people I know. Without divulging what his company does, let me just it is a niche, and he has also tweaked his business model and delivery channels to meet changing market conditions. By his own admission:
“If we were still doing what we had always done, focusing solely on X, I would probably still be hustling to cut costs like I was in 2008 and 2009.”
In a lot of ways, his recent success sort of reflected, to me, what I have been sort of pontificating about for some time. 1) the most successful companies compete on either product or price; everyone else is ‘stuck in the middle,’ and; 2) as Larry Langford, the imprisoned former mayor of Birmingham, used to say: “If you always do what you always did, you will always get what you always got.”
Increasingly, I am seeing more companies looking to differentiate themselves in some form or fashion. They have to do so in order to survive. One of my favorite examples is the Winn-Dixie on Montevallo Road here in town.
For years, this place was a depressing place to shop. It couldn’t compete on price with the Wal-Mart a mile or so, if that, down the road, and it couldn’t compete with the Publix on product. It was ‘stuck in the middle,’ and there was absolutely no reason to shop there. Frankly, I didn’t understand how it stayed open, and was shocked when the construction crews showed up.Yep, despite the financial woes the parent company has had, the powers that be decided to take a gamble on this particular store. It was a lost cause, in my opinion; putting lipstick on a pig. To top it off, work on the project was slow, painfully slow. This made shopping there that much more depressing, as exposed ductwork and concrete floors gave the place a certain 3rd World charm without any of the character, if you catch my drift.
To read more… July 05, 2012 Common Cents