Never try to compete on price.
You will fail if you try to compete on price. We can guarantee that with 100% certainty. if one cannot compete on price, what other basis is there? The “secret” is to compete on design. your role and value at the small business level is to be a innovator, which means premium prices and unique designs. You make more money doing less. You may be selling hats like anyone else, but they are upscale, specialty hats. You may have a hole in the wall restaurant, but your Chow Mein is $22.50 a plate.
If you plan to be a big business billionaire like Steve Jobs, you start here. If you plan to be a small business billionaire like Ty Warner you start here. If you plan to have your dream lifestyle, and don’t care about the money, you start here.
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6 comments:
Weren't Beanie Babies cheap before they became a fad? I think they were like $5. Wasn't this competing on price?
It is the designer paper clip issuem they look cheap at a nickely each, but price conscious paper clips are ten for a penny. $5 is expensive for a beanybaby...
It is the designer paper clip issuem they look cheap at a nickely each, but price conscious paper clips are ten for a penny. $5 is expensive for a beanybaby...
I'm thinking of doing a business experiment: Can I start a product line of unique, collectible products (like beanie babies or hummel figurines for example) and deliberately turn it into a well sought after mania or fad? How would upscale specialty stores be approached (I'm assuming it would be the same as John teaches)? Would the approach be any different from what you teach? Can the product line be managed by using limited editions (limited production), unique designs, a prolific number of different designs, and targeting up-scale stores?
I think there is a difference between a mania and a fad... as I mention in the book. These things cannot be programmed, if they could, Mattel would do one every six months. They are like lightening strikes... you cannot call one down... you do your best and you get what you get business wise...
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