Why niche players should be like nomads
The niche market expands
As a niche player you have a good business with reasonable margins and a slow sustainable growth.
As your market grows your revenue increases too.
The world seems perfect and the future is bright.
However your niche is becoming less a niche and your market gets a broader appeal and interest from more customers.
More competition will move into the market.
Soon even large corporations will acquire competitors or create their own products or solutions.
Competing with large corporations: not done
Competing with the large competitors is a battle that normally is won by the large corporations as they have the capability to scale in marketing, sales, manufacturing, logistics and distribution supported by their brand name.
Seldom has the niche player actually stayed leader in his market: only if he can achieve scalability in order to equal to the major corporations and coping with the growth of his organization.
At the moment the multinationals have overtaken the market,
it is too late for any niche player to shift focus to another market as:
- the margins have become minimal due to the competition
- market share has decreased
- net income has become less
- money is drying up
Hence less cash available to invest in order to start-up in a new niche market.
The curse of the niche player: a market nomad
Niche players should start to plan to move on to a different niche market as soon the market opens up and new competitors enter the market.
At that moment the money gained should be invested in order to create new products or offerings and to develop the niche market.
Niche players should be nomads moving from one niche market to another every time the market expands significantly.
The curse of the niche players is being a nomad. A market nomad.
If you are working for a niche player, in what stage is your niche market ?
Is it time to look for a new niche market ?
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