Winning in a Losing Town

Why Are You Here?

Whatever the reason you chose your location, one thing is clear--you need to have a passion for what you're doing. If you think customers will break down your doors simply because you hung your shingle, you'll be in for an expensive lesson. In an underserved community, members will be suspicious of the "newest thing in town," especially if they've been expected to pay high prices in the past for poor service and product choices. They will want to know who you are and that you have their interests at heart. Van Groth says you must be "community fluent" before even thinking about introducing products and services into the market.

So how does one become "community fluent" in a community that's tight, possibly suspicious, and hard to reach? Get involved, says Thomas E. La Gabed, a chiropractor in Lincoln, California (population: 14,000). When La Gabed and his wife, Jennifer Norton, moved to Lincoln to start Lincoln Family Chiropractic, their biggest hurdle was having people accept them. "Moving into a town where everyone knows each other was very scary," says La Gabed. "We worked hard to be accepted." La Gabed and Norton joined the chamber of commerce, volunteered for committees, joined (and coached) local recreational teams, and attended church. Plus, they bought a house, securing their commitment to the area. His advice? "Get out and meet as many people as you can."

What's Your Deal?
It's possible that your business is replacing another that didn't make it. What will you do differently? Can you learn from their mistakes? How will you convince your consumer base that your business is worth creating a relationship with? Will what you are offering be enough for them to shift their buying habits in your direction?

In a down economy or depressed area, many are reluctant to change what they know and what feels comfortable, especially when it comes to their pocketbooks. They don't want to establish a new buying habit if they're not sure you'll be in business in a year. It's important that you offer the "over and above" kind of service, because in a tight community, people talk. And your reputation may count on how well you meet the needs and desires of those who have taken a chance on you. Van Groth breaks it down simply: "Give [your customers] the quality of service and dedication worthy of a lifetime customer, because that's what they will be if you give them the best that you've got."

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Making a Go of Things
You're set. You're determined. You know this is the place for you. The road to the open door is long and arduous, but it's only the beginning. You'll need to prepare specific strategies (beyond knowing your community) to build and sustain your dream. While these strategies would apply to any business, they become more important in a smaller, more economically challenged community:

  • Start your company as a homebased e-business, for a couple of reasons. First, it might be the way to raise capital for a brick-and-mortar business. Establish an image on the Web, test your product or service, and gain momentum and dollars before venturing into the high expense of leases and traditional marketing. Second, it's a vehicle that expands your customer base exponentially at a relatively low cost. Your online venture could be as simple as hawking products at an auction site or as complex as creating your own site from scratch.
  • Look for alliances. How can you get done what has to be done when people have more time than money? asks Andrew J. Birol, a Cleveland-based business growth consultant, owner of Birol Growth Consultants and author of Focus. Accomplish. Grow. The Business Owner's Guide to Growth.

La Gabed and Norton started their practice using the off hours of another chiropractor's office. He already had the equipment and office space they needed and was happy to strike a deal where he earned extra cash for time he wasn't working. It allowed La Gabed and Norton to build a patient base before signing their own lease. Think how you might be able to develop creative alliances with service providers and companies with complementary products. (Study McDonald's partnership with Disney, for instance.)

  • Know your customers. From the moment you open your doors, track your trends. Your customers may buck traditional wisdom, but you will not know it unless you measure it. Note average order sizes, purchase frequencies and responses to different ads you've placed. Watch what your customer is purchasing, understand how they intend to use them, and find ways to deliver more value to their experience. For example, an ISP might find that consumers new to technology would appreciate (and pay for) training with their Internet service.
  • Be flexible. Watch what works and what doesn't. Be willing to change your mix of products and services as the market changes.
  • Be ready for some hard work. Says La Gabed, "If you love the town and you are willing to work hard to get what you want, then it will work for you."

Carrie Schmeck is a freelance writer specializing in small-business marketing issues. She worked in promotional marketing for five years before leaving to help her husband run two small businesses.

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This article was originally published in the March 2002 print edition of Entrepreneur with the headline: Winning in a Losing Town.

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