Q: My
partner and I are getting started with a small business selling
golf equipment and diecast collectible cars. We have a retail shop
and sell on eBay and at flea markets. We have branded ourselves as
a "sporting goods and hobby shop," but we need to know:
How do we grow this business to become extremely successful? With
all the competition, how do we find our niche market and obtain a
piece of the pie?
A: My
immediate reaction to your question--before even considering how to
grow your business--is that it sounds like you are doing two very
different things: selling golf equipment and selling diecast
collectible cars. For a retail store, this could be confusing: If
someone is in the market for golf equipment, is that person going
to be interested in collectible cars? And even if they are
interested in both, are they likely to purchase both at once?
Perhaps you are in a situation where someone comes in to shop for
golf equipment and happens to look at (and maybe purchase at a
later date) your cars, and vice versa. But my instincts say that if
you are going to keep growing, you'll need to separate the two
businesses.
The reasons to separate the businesses, either by creating two
different retail concepts or by eliminating one of the concepts
altogether, will become clear if you sit down and write a detailed
marketing plan. This plan is what is going to help you grow and
build your sales. You are likely at a point in your business where
you have a steady stream of loyal clientele, but to go beyond that
and reach new customers, you need to give yourselves some clear
direction about who exactly that customer is. (Take a look at our
How to
Create a Marketing Plan guide for assistance in writing your
plan.)
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Think of it this way: If you go into a hardware store, you are
probably going in to buy something very specific. Any browsing you
do will be minimal and will be related to the one or the few
projects you have in mind. If there were, say, an auto-parts store
connected to the hardware store, while you might sneak a peak, you
probably aren't going to buy. Likewise with the auto-parts
customer--they're not interested in the hardware store (at
least not at that moment). You have two different customers
shopping in one store. If you keep trying to market to both of
them, you are going to exhaust yourself--and your budget.
Separating these two businesses will give you the freedom to
focus on one niche at a time. Assuming you don't have the
resources to open an entirely new retail store at the drop of a
hat, my suggestion would be to pick one or the other for the
brick-and-mortar location. Use your marketing plan (and perhaps a
revamped business plan) to determine which concept will bring in
the most revenue. Alert your existing customers of the imminent
change--and make plans to sell one or both types of products on
eBay.
My instincts again tell me that a brick-and-mortar golf store
would bring in more money than a collectible-car store. They also
tell me that it makes sense to sell collectible cars on eBay, where
collectors love to troll about, looking for rare treasures--not to
mention it's much simpler to ship a small collectible car than
a set of golf clubs. I did a search for "diecast collectible
cars" on eBay, and I only came up with two results--which
could mean you have the potential to carve out a nice niche on
eBay, if you market your product correctly. (Refer to the eBay
seller guidelines for more help on properly selling your product.)
But don't take my word for it--do some research. And remember,
you can sell both types of products, but I'd recommend easing
into these changes to your business--for your sake and your
customers'--rather than doing everything at once.
As for the flea markets, take a look at how much money you are
actually bringing in from them. Evaluate whether it is worth it to
spend a Saturday hawking your wares to people who could wind up
being one-time customers--or whether your time and money would be
better spent on cultivating the relationships you have with loyal
customers. In the long run, those people are more likely to bring
in the dollars you need to grow your business--and get you a piece
of that proverbial "pie."
Karen E. Spaeder is editor of Entrepreneur.com and managing
editor ofEntrepreneur magazine.
The opinions expressed in this column are those
of the author, not of Entrepreneur.com. All answers are intended to
be general in nature, without regard to specific geographical areas
or circumstances, and should only be relied upon after consulting
an appropriate expert, such as an attorney or
accountant.