In order for a business to prosper, it needs to have a niche. That’s because when you don’t have a niche, you’re not only trying to sell your product or service to everyone; you’re also trying to compete with every other business in existence.
However, when you do have a niche that works well for your business, it gives you an edge over the competition. You see, if you know what your niche wants and needs and how they behave and think, then it’ll be much easier for you to find out how best to serve them.
One of the most common mistakes we see in businesses is the failure to pick a niche. Most businesses focus on a broad market. And we get it. Picking a niche can be scary. It does, after all, require that you actively choose to cut out a group of potential customers.
Doesn’t that mean lost revenue? Probably. And therefore lower net profit? Probably not.
We’ve seen many cases where the opposite is true: businesses who target a specific niche end up with higher profits because they are able to tailor their marketing, products, and services to those specific customers and their specific needs.
We’ll use an example of a client to show what we mean.
This client was working with customers of every size. And on the surface they were making the same amount of money. Through our specialized CFO services, however, we were able to show her the differences in two groups.
The first group had significantly higher set up costs, communication time requirements, and labor demands.
The second group came with increased deliverability issues.
Numbers showed the profit potential of the second group was higher than that of the first group.
She was worried niching would cost her revenue. And for the first two months that happened. But in those two months her revenues dropped while her net profit actually increased.
As time progressed, however, she was able to focus on acquiring the right customers. And her revenues increased while her net profit substantially grew.
She now makes twice the revenue with profit margins three times higher while working the same amount as before. And all it took was focusing on the right niche.
What Is a Niche?
Some of the most successful companies in the world are niche businesses. They take a very specific approach to what they do and direct their services to those who need it most. For example, if you wanted to open a tax preparation business, you could have several different niches:
Small business taxes
Each of these is a different niche within the same industry. They all offer the same service — tax preparation — but they each have their own unique approach and clientele.
The best part of being a niche business is that your audience is often easier to target. You can focus your marketing efforts on people who are actually interested in what you provide, instead of putting too much effort into trying to reach people who aren’t likely to be customers.
Let Wasatch CPA Services Help You Find Your Business Niche
Choosing a niche really is the best way to get ahead in business and earn higher profits. When you find the right niche, you’ll have a more satisfied and loyal customer base because you’ll be speaking to their needs specifically. You’ll have less competition because you’ll be the only one addressing a specific issue for that market. And you’ll also be spending less time, effort and money in your marketing efforts since you’re not trying to appeal to everyone.
Is it time for you to find a niche that works better for you? If so, let us help. Call Wasatch CPA Services in Pleasant Grove at (385) 247-0165, today!