7 Tips to Find a Niche Market for Your Business
The success of your clients depends on the quality of your products.
When running a business, you’re going to want to gain an edge over your competitors. Whether you’re doing that as a retailer or as a wholesaler breaking into an industry, it’s important to see what your competition is doing and how you can learn from them, avoid their mistakes and, ideally, overtake them.
The Importance of Having an Edge
An edge is what will set you apart and make retail clients come to you over hundreds of other wholesalers in the market.
Think about it from your customers’ perspective: why would they choose you, another run of the mill supplier, bringing their restaurant, bakery or home food business the same stock of vegetables, fruit and meats that other businesses with the advantage of scale can probably offer for cheaper?
When you’re a B2B operator, your customers are also businesses trying to maximise their profit and savings. They’re also looking for the lowest bid on the highest quality, to make a new product and offer it to their customers, the final consumers.
The success of your clients depends on the quality of your products. Why would they spend an extra dollar per kilo of cilantro that you bring in from your supplier’s farm, when they can get it for cheaper from a competitor’s business?
Your client won’t really care that you’re a small business whose supplier’s farm is farther off, or that you work with contractors who charge you an arm and a leg for shipment and delivery. To them, it’s the simple fact that two businesses are offering similar quality products, with a price difference that’s significant enough for them to switch.
Are you giving your clients certain special offers, a loyalty saver option, a discount that keeps them coming back, or really, any incentive that’s enough to keep them around?
If your answer is no, ask yourself this: why my business?
Understanding a Niche
An often passed-around piece of advice that people give to companies is to “create demand.” It’s overused and overdone—we’re living in a world of smart consumerism, and of course, every day we’re met with new problems that require new solutions, but it’s not always about that.
Innovation doesn’t exclusively refer to creating something ‘new’ to have an edge or be a forerunner in the market; sometimes it’s simply about offering your clients something they won’t be able to find anywhere else.
You don’t need to create an artificial need by tricking businesses into thinking they need your services; make them come to you by offering something that cannot be refused. It’s easier said than done and would require you to make a lot of decisions and some serious evaluation and perhaps even redirection of your business strategies.
Focus on where you can come in as a wholesaler, what gaps you can bridge with the products and services you offer, how you can connect with your clients like other suppliers can’t. Find what makes you tick, what makes your clients click with your business and how to expand on that.
Finding Your Niche
Now that you’ve decided to go off the beaten track and venture into a world of risk and exploration, how do you move forward?
Primarily, it means finding yourself away from the crowd, taking a chance and really understanding how market dynamics are different from where they might have been a while ago. You’d think you’re not affected by consumer trends and wants, because that’s a problem for the retailer, but that couldn’t be farther from the truth.
Understand the way changing consumer behaviours will affect retailer behaviours and how that, in turn, opens up not just new markets for you, but also alters your business strategy.
Here are some tips on finding a niche for your wholesale business:
1) Find what your passion and interests are
This is essential for any sort of business owner. Whether you’re running a small start-up offering digital protection services to clients in your area, or you’re a well-known wholesaler offering the finest quality produce to restaurants across Melbourne, there has to be a sense of purpose to your work. Business is business, yes, but you still need something that gets you interested, excited and makes you get up and out of bed and show up to work day after day.
Only if you’re dedicated and passionate enough will you be able to seek out a niche that you want to chase. See what you can see yourself investing time and effort into in the long haul.
2) See if there’s an industry for these passions and interests
Understand that if you have a general interest in something, and think it’s a viable and necessary business idea, not everyone might agree. Is there anything remotely related to this passion of yours? Or are you the only business owner who thinks that it’s an important area of focus?
3) Conduct extensive market research to understand unmet needs
Understand your target customers; who are the people you’re aiming for?
Perhaps you don’t know, and this is where you can work backwards. See how trends are changing locally and globally, what’s emerging, what’s being scrapped and what’s still relevant.
Understand how you can come into the picture as a seller and offer specific segments of the society that need your product. For instance, in today’s world where ethical consumerism is all the rage, consumers want to know the impact of their choices—which means retailers need to be more transparent about their processes too.
As a foodservice wholesaler, you can offer clients whose businesses align with these principles and offer them deliveries in recycled packages, for instance. Or offer organic and free-range produce. It all depends on the specifics you wish to adopt.
4) Make sure you have enough of a market to take on this niche
Of course, you wouldn’t want to alter your entire business strategy or create an entire business for a market that’s either too saturated—as can often be the case with niches—or for a market that doesn’t quite exist.
If you have two clients that need no more than a few dozen free-range, omega-3-rich eggs for their healthy food ventures and no real signs of growth or expansion for your business, there’s no point to investing in something like that. You don’t want just to break even and help clients meet their needs—you’re also running a business!
It’s important to evaluate the pros and cons of any business venture and if you’re working with a niche market, it’s even more pressing to do that.
5) Consolidate a marketing strategy, network and build a referral system
You’d think that because you’re fulfilling a need and bridging a gap by virtue of operating, but there also needs to be an effort made to connect with your clients. You can’t get lazy and rely on organic business alone, even though that’s likely to work for niches. You still have to consider what makes you stand out and why clients should trust you with their specific needs.
Wholesale marketing strategies are obviously very different from retail strategies, but the basic idea of getting clients on board still stands. Instead of reaching out to individual consumers, your target is retailers, and you can reach out to them in various ways.
From offering discounts and offers that attract new clients, encouraging them to try your product, to target very specific customers that need your product, using emails, pamphlets, advertisements or sales reps—it depends on your strategy.
Send samples; ask them to see for themselves if they’re satisfied with the quality. Take in suggestions if possible.
Build a reputation and then ask for referrals, network at events, conferences and keep up with industry names and local businesses alike. There’s potential wherever you search for it.
6) Make use of any and every resource you can
Use social media, connect with clients and make your brand available to potential clients. Make use of contractors and see how your small business can benefit from technology. Invest in an order management system like OrderTron, which is great for small businesses, and can help suppliers organise and connect with clients, take orders and manage deliveries. It also calculates your stock, so you avoid overstocking and risking losses. Take whatever help is available to you as a business owner!
7) Keep loyal and regular customers on board
You want to be ambitious, but you don’t want to chase away your regular clients either. Invest time and effort in keeping old clients coming back to you—not only does it cost less, but it’s also good business practice to do so.
When you’re working in a niche market, your clients will already be limited. You don’t want to drive them away and risk losing the limited market share you do possess. Your work will speak for itself at one point, so don’t worry about that.
If you’re a wholesale seller venturing into a niche market, stay focused, stay organised and don’t be afraid to take risks. Learn more about OrderTron and how it can help your business grow by contacting us here!