Friday, November 21, 2008
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succession
strategy & growth
  Today's Thought - Get More Results By Reframing Your Competitive Perspective

A friend of mine owns a local restaurant. His menu and moderate prices attract a local clientele on a regular basis. The food is quite good and the menu is imaginative. I asked him, "Why not raise your prices -- you are just a good as ...?"

He responded, "Being moderately priced makes my place a regular comparative choice when people are choosing among local restaurants. My menu gives my restaurant a competitive edge. If I raised my prices and became a fine dining establishment, my meal tickets would be higher but we would become a special event venue, not a place you frequent. I'd have fewer customers overall and very few who would come regularly. Frankly, I like my regulars and we are gaining new regulars every month."

In most industries, there are many supplier choices, ranging from high end to bargain basement. And in most instances, there is enough opportunity for any number of providers to make a living by being a comparative choice. There are those who preach that you must become bigger and bigger, giving up your smaller (lower margin) customers in favor of bigger, more profitable, ones. Here is a business creating sustained value using an inclined plane of steady growth that combines the strategies of selling each customer more and taking good care of each and every customer at every meal, not trading up to new, more affluent, faces.


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