3 Ways to Stand Out from the Competition and Take Market Share

Have you ever driven around town and thought to yourself, "Man, there sure are a lot of painting trucks on the road!" 

(Now that I've mentioned it, confirmation bias will kick and you'll start to see them everywhere 😀.)

On the one hand, that suggests that there's a lot of demand for painting services.

On the other hand, that also means that there's a lot of competition to provide service for all of that demand.

So it begs the question: If you do in fact see lots of painting trucks on the road where you live, would investing in a painting franchise be a wise move?

We're not just talking about painting. Think about any business in your area that you see a lot of signs for: Plumbing; HVAC; Pest control; Gyms; Accountants; Real estate agents. You get the idea. Many of those are potentially great businesses, even if there appears to be a lot of competition.

I sat down recently with Allan Alarcon, co-founder of ResiBrands, and raised this topic with him. I think you'll find his answer insightful and telling. Give it a listen:

The key point Allan makes is that a fragmented industry with lots of "Chuck-in-a-Truck" competition presents opportunity. But that opportunity can only be realized if you successfully take market share from existing businesses (something that's true whenever you start a new business, by the way). Here's how to do that.

3 Ways to Take Market Share When Launching a New Business

1. Have a Unique Competitive Advantage

The easiest way to stand out from the crowd is to offer something that nobody else is offering or do things in a way that is different from the way your competition is doing it. Now, I'm not talking about gimmicks. Fads and short-term gimmicks may generate substantial business for a while, but what happens when the trend ends and people move on to the next shiny object? You want to build a solid, stable business that will provide a wonderful lifestyle for your family well into the future, so you want to ensure that your competitive advantage is something that is integrated with your business model and will still make you the go-to in your industry years from now.

Let's circle back to painting. There are a lot of painting businesses because the barrier to entry is fairly low and there's a lot of demand. But when you run a Google search and read the description of the different companies in your area, they all pretty much look the same. So how do you choose? And if you're the business owner, what can you do differently to stand out? LIME Painting is an example of a franchise painting business that has carved out a unique niche by only servicing homes and businesses valued in the top 30% of the market. Because high-end properties tend to need more than just a new coat of paint, they're able to layer on additional services resulting in an average ticket of $19,414, 4x the industry average.

Or consider pest control. There are a lot of companies that will come to your house and spray for bugs. But ohDEER is the only all-Natural option to traditional mosquito/tick treatments and deer repellent services. That means that your customers don't have to leave their house for two days when it's time for their quarterly spraying. Their kids can literally be jumping on the trampoline while your technicians spray their property — and your technicians don't have to be wearing gloves and masks while applying the product! Talk about a competitive advantage in an increasingly health-conscious demographic.

Whatever industry you're looking to break into, align yourself with a brand that has a built-in competitive advantage. Doing so will accelerate your path to profitability because of the relative ease with which you can acquire new customers.

2. Be Consistent

According to the U.S. Department of Labor and Statistics, nearly 50% of small businesses fail within five years. There are a lot of reasons for that, but the point remains: If you can outlast your competition, you can fill the vacuum they leave behind and acquire new customers that might have otherwise gone to them.

Business isn't overly complicated when it comes right down to it: Find the activities that fill your pipeline and lead to new customers and do those things over and over and over again. Consistently.

Also, don't give up when things get hard. Every business encounters sticking points. Markets change. The economy has highs and lows. There will be challenges when building any business. Expect it. If you expect things to be hard at some point during your first five years in business and have the mindset from the outset that you will not quit, you will be better able to withstand setbacks and still be in business long after your competition falls by the wayside.

There's a saying in sports that the best ability is availability. In other words, you can have all of the talent in the world but if you're always injured and unable to play, you're not doing anyone any good. The same goes for business. Your expertise / skill / service / widget can only help people and benefit your community if your business stays in business. Consistency is the key to making that happen.

Business guru Codie Sanchez puts it another way: "'Hack' does not mean 'shortcut.' The best hack is realizing consistency is what matters. Show up every day."

3. Provide Next-Level Customer Service

A while back I presented several franchise brands to a woman who was transitioning out of Corporate America and wanted to start her own business. She found the first couple of concepts that I showed her to be moderately appealing, but then her eyes lit up when I got to Floor Coverings International. She immediately resonated with it because she had recently remodeled her own home and recounted how frustrating it had been dealing with certain contractors. And then she said something has always stuck with me. She said, "I think I'd be able to build a really successful business in the home remodeling space because simply answering the phone, showing up on time, and doing what I say I'm going to do will separate me from 90% of the other companies out there." She's exactly right about that.

People do business with people and companies that they know, like, and trust. People will like and trust you if you provide impeccable customer service. Why do people drive across town to Chick-fil-A even if there's another fast food joint closer? Great customer service. Gary Vaynerchuk famously responded personally to every social media DM he received for years when he was growing his online wine business. That's customer service, and it differentiates you from your competition.

Yes, the product or service you provide has to be good. But people will sometimes settle for lesser quality if they enjoy doing business with you. Customer service matters that much. And the best part? Not only does first-class customer service lead to repeat customers, but it often leads to referrals, too — and referrals are the lifeline of any new and growing business.

Conclusion

When evaluating a particular industry or niche to break into, remember that fragmentation isn't the same thing as saturation. The more competition there appears to be, that could actually be a good thing if it reveals a fragmented market with a lot of smaller players. When that's the case, it presents a great business opportunity for you because it's often easier to take market share in a fragmented industry by implementing the three strategies discussed above.

Consider, too, that you may not have to take as much market share as you might think to build a sizeable business that is capable of replacing your current income and generating legacy wealth for your family. Remember LIME Painting? With an average ticket of around $19,000, you'd only need 53 customers to generate $1M/yr. in revenue. That's basically one customer per week. That's incredibly realistic, especially when you consider the backing and support that a franchise provides.

Perhaps that's why Entrepreneur reports that only 3.9% of franchise businesses are terminated or close within five years, a much higher success rate than we cited earlier for small businesses generally. In addition to the numerous advantages that franchisors provide their business owners, they excel at product differentiation and customer service, with longevity built into your franchise agreement. If you're exploring business ownership and have never considered franchising, schedule a free consult with us. We'd love to see if it could be a good fit for your family's goals and empower you on the path to entrepreneurship.