What's the Best Business Location?

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Scenario: "Dude, we gotta choose a location that has no competition. We'll be the only one. Yay!" Peep this: You're opening a furniture store.

Scenario 1: You choose a retail spot in a remote location.

  1. You speculate traffic will come because of the incoming high-rise buildings.
  2. Ten months later: you see some traffic, but nothing that really fits your target demographic.
  3. You thought it would happen, but you're no fortune-teller. No one is.

What happens to your company? Bankruptcy in the mutha-!@^^% ^&*.

Scenario 2: You choose a location with competitors galore.

  1. You know your target market visits businesses of your type in that area.
  2. You have real-world results/reports/data/evidence of businesses -- like yours -- thriving in that particular area.

What happens when you locate there? With more exposure to your demographic, you start making freakishly more $$$.

Common Sense Sucks

The criminal advice from all those 'business experts' who sold you books: "Choose a place where's there's no competition. Yay!" Bull-!@^^%^-!@^^. That's why most businesses fail: They start distancing themselves from their targeted demographic, then wonder why the heck no one visits. When choosing your retail location: Rule ^1: Get as near to those-most-likely-to-buy as possible; that is, where your competitors are thriving.

What happens when you situate yourself among the flourishing competition?

  1. Targeted Customer Charmaine sees your location.
  2. She visits your location (1) on impulse, (2) because she couldn't find what she needed at the competition, and/or (3) because customer service sucked.
  3. If you're good, she (1) buys, (2) comes back, (3) brings a friend, and (4) recommends you to other friends.

That cycle viciously repeats with another customer, then another, and another -- until the end of time. You win.

The Starbucks Effect

If Starbucks opens a store in the middle of several mom-and-pop coffeehouses, Starbucks would crush 'em all -- right? It's typical conventional wisdom: 'Big retailer comes to town, wipes out all mom-and-pop coffeehouses!' Bull-oney. While the few sucky ones who-provide-!@^^%&-shoddy-service-and-deserve-it do die, the ones who provide customer value thrive -- even more. Why?

  1. Starbucks introduces ignorant-coffee-dude Cletus.
  2. Cletus becomes a coffee fan.
  3. Cletus: "Hey! I love coffee! I'm gonna try these other places around Starbucks too!"
  4. Cletus: "Yay! Rockin' coffee. High-five! High-five!"
  5. Cletus: "Let's visit this other coffeehouse too. Yay! High-five!"

Starbucks initiates the new-who-then-become-fanatic peeps, who soon venture further into other coffeehouses -- opening up more opportunities for the mom-and-pop shops. As the mom-and-pop shops develop and keep their loyal following, they grow their revenues with new market opportunities created by their 'crushing competitor.' Win for every frickin' solid coffeehouse in the area. Situating your business in an area of "supposed" competitors does the same thing: It creates more opportunities for your business to attract those most likely to buy from you. Another example:

The Mall Effect

Big apparel shops go krrr-aaa-zzzy situating their stores among the competition in malls across the world. Levi's, Diesel, Seven, Lucky Jeans, Mark Jacobs, Guess, Polo, True Religion, and the yadda, want neighboring competition. Their mindset for doing so:

  1. You want jeans.
  2. You'll visit multiple shops within a small vicinity for your jeans.
  3. "We want to be there when you're buying your jeans."

Multiply that scenario by 94839820358209094803325832532, and you'll see why almost-every-frickin'-gosh-dang store thrives off the competition. More competition = exponential increase in traffic = more purchases for all.

What You'll Need to Succeed

Sure, you can't expect to (1) imitate an already-established competitor, (2) locate yourself in that same area, and expect to succeed. Those 'business experts' say that you'll need "differentiation." We say bull. Just ask yourself:

Where can you kick the competition's ass?

Don't toot your own horn; be a realist.

  • If you're competing against them multi-million-billion-dollar competitors on (1) prices, (2) inventory, (3) marketing, (4) incentives -- you'll lose.

But say you're opening that furniture store, and you have a world-class degree in interior design. You can't compete on prices and marketing dollars with those big mutha-bastards, but you can demolish the competition on your interior design skills. So, you build a furniture store using an interior design theme, where your store:

  • Provides assorted color psychology tips throughout the store.
  • Trains employees your interior design skills to consult with customers, anytime.
  • Offers free interior design workshops on Tuesdays, enticing future orders.
  • Tags furniture item (e.g. coffee table) with placement tips -- what matches with what.
  • Complements neighboring competitor services with interior design services.
  • Offers a monthly newsletter on interior design sent to their email/mailboxes, ensuring you'll keep that prospect/customer for one frickin' long time.

By focusing on where you can rock the competition in the area, you gear yourself to kick major ass.

Piggy Back 'Em Off the Heezy

Existing 'competitors' have done all of the hard work for you, which likely took years/decades:

  • Generating key demographics to the location.
  • Gathering real-world data of your target demographic.
  • Doing target market foot-traffic research studies.

No bottlenecks. No rough starts. No need to push any freakish momentum -- which takes years (if ever) -- by your lonesome. Nada. Real-world evidence tells you:

  1. Key customers gravitate to a certain location.
  2. Businesses of your type are thriving there.

Now, be the opportunistic badass and hop on the mutha-!@^^%& train that's already running full-steam ahead. Choo! Choo!

Takeaway: Most Business Competitors Suck

We'll close with this takeaway: we'd rather not hate -- but we think it's certainly true: Whether that's customer service, fulfillment, bugs, defects, horribly-trained employees, non-responsive management, or the yadda: Most business competitors suck -- and yet, they're still flourishing in several locations. You can do a much more bang-up job than most of 'em sucky-suck-suckers-who-only-care-about-frickin'-dollar-bills, and-not-servicing-customers. Scared of competitors? You shouldn't. Just visit them.

'Where's the mutha-!@^^%^ competition at?!"

 

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Posted on May 21

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