Did you know that one Giant Atlantic pumpkin seed can cost $800?
Giant pumpkin farmers are willing to pay a premium price because the seeds are unique and provide precisely what the giant pumpkin farmers need/want. These farmers don’t want to grow an ordinary pumpkin but rather a prize-winning giant pumpkin.
How does this relate to building a business?? It all comes down to what your unique offering and niche are.
Giant Atlantic’s product is a giant pumpkin seed.
What is your “giant pumpkin seed”? What unique offering do you sell to your customers?
To start, you need to know your area of innovation and what your top customers want. This allows you to command profitable pricing based on the value of what your company delivers to your top customers. You’ll be good at everything in your business, but you’re going to excel at one key area of your business.
The secret to maintaining your unique offering is once you know what your area of innovation is, you must continue to improve it. It’s not something that is one-and-done. You must consistently keep up with the times, or eventually, another company will out-innovate you.
Price, Convenience, or Quality?
Your area of innovation will fall into one of three categories: quality, price, or convenience. It is challenging to excel in more than one area. Most large businesses only focus on one thing.
For example, Walmart or Dollar Tree focus on competing on price. They aren’t necessarily big on quality or Convenience, but they will be on price every time.
Price is tricky for small businesses to compete on. You don’t have the same purchasing power or economics of scale that the large companies do. When a small business tries to compete at the lowest price, they struggle to make a profit.
You could, however, compete by being the highest price, which usually signifies that you are a luxury brand. For example: Before Starbucks came along, a cup of coffee was about $0.50. Then Starbucks created a unique experience, sold coffee in to-go cups, $5+, and positioned themselves differently from the competition. And it turned out to be highly profitable for their business.
Amazon competes on convenience. Occasionally they have the lowest prices or better quality, but their overall business strategy is focused on making the purchase as easy and fast as possible. They’ve devoted significant resources to developing systems that create the highest level of convenience.
The last area of innovation is quality. This doesn’t necessarily mean high or low quality, rather quality of the experience. For example, Zappos is an online shoe company. They’re known for their outstanding customer service and experience. Their tagline is powered by service. They are constantly striving to find ways to wow their customer experience.
Choosing your area of innovation
But how do you select your area of innovation?
This is the key to standing out from the crowd. If you could pick one thing to do and excel at, what would it be? You will not be just choosing something that your company is good at, but rather something you are willing to continue to innovate and improve upon. Something that you will continue to knock out of the ballpark month after month, year after year.
Then you’ll make sure everybody knows what you do and what your area of innovation is.
It’s something that your top clients are really going to value. So start by asking yourself and your clients what something in the industry that isn’t being addressed is? Or what is something that quilt shops aren’t doing well?
It may take some time to find the answers to these questions. Take the time to talk to your top customers and ask them what’s not working well and their strengths.
First, ask about the industry as a whole. Then, for your quilt shop. Then review the answers you receive and find a common thread.
Next, you’re going to identify what your strengths and abilities are for your company. What do you do well? Try to find a common thread and theme from your customers. Does it relate to innovation, quality, or price?
You’ll also want to consider what lights you up? What do you enjoy doing? What gets your ideas flowing? Those are important things to consider as well when determining your area of innovation.
What makes you stand out and what makes you different from other quilty shops?
Once you identify that, find ways to improve upon it and outdo yourself month after month!
Do you need support discovering your area of innovation??
Check out the Money Made Simple Academy for Quilt Shops. We have live coaching sessions that cover topics such as this and move you towards growing your shop and gaining financial peace and freedom.