Very few of us will become the next Tesco or Amazon and take over the world. Given that, becoming the “go to firm” in a small niche can be the key to financial success.
Being a big fish in a small pond gives you multiple benefits:
- Expertise – If a plumber approaches you and some general web design competitors, chances are they’ll be impressed by your industry knowledge so more likely to go with you.
- Search engines – for a new small business, ranking well for “web designer” is nigh on impossible. Ranking well for “web designers for plumbers” won’t be.
- Less price sensitive – if you’re the expert in your niche, people looking to purchase within your niche will be prepared to pay a bit more for your skills.
- Streamlining – you’ll be able to do the work quicker as there’ll be less to learn for each job. To some extent you can automate or copy/paste certain things. Obviously take care with this, but again using the example of plumbers, they’ll likely only have a local geographical reach, whilst you can easily have a national reach. Therefore a plumber in Cornwall shouldn’t be too concerned if another plumber in London/Edinburgh has a similar website.
Bad points? – The main argument against “niching” tends to be that you’re greatly limiting the size of your potential market…but as long as that smaller market is big enough for you to thrive, who cares?! I have no idea of the stats, but I’m sure for a one person web designer they could make a very healthy living even if they limited themselves to just plumbers.
Expand that niche – Of course if they wanted to expand, they could easily go for electricians or other tradesmen. I’m sure if marketed to this (larger) niche well, it could generate enough work for a small team to be kept busy.
Maslins has heavily skewed towards FreeAgent using contractors/freelancers.
MVL Online only offers solvent liquidations to cash shell companies (means we can heavily streamline).
“Success”? – In my first paragraph I deliberately said “financial success” rather than “success”. I know lots of people who have started their own business doing something they absolutely love to do. They have no dreams of huge growth, but enjoy the variety that each varied new client brings. They would consider themselves successful, and I’m not arguing with that.
Inevitably the more you niche, the less variety you get in, which for many may mean boredom. So whether to niche may in part depend on whether you want to enjoy doing a variety of work in your chosen field, or whether you want to build a scalable business with systems and/or staff.