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Doing $75,000 USD Per WEEK (Service Business)

The Abundant Man

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458

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I appreciate your apology, that speaks a lot about your character over all.

To help get this thread back on track, and potentially become a gold thread...

Can you give us a bit more clarity on what you excel at in detail? (maybe a mod can add the snippet in the OP)

You've stated a high ticket item and you lead the sales team, but maybe explain a bit about what you excelled at to get you there.

Was it hiring and inspiring the sales team?
Building sales team infrastructure?
Cohesion between sales and production/fulfillment?

Anything that can narrow us in to how we can ask calibrated questions that set you up to really help out these new guys?

I still have this write up on my task list, have not forgotten. Will get it done next week.
 

458

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I still have this write up on my task list, have not forgotten. Will get it done next week.

Dealing with a mini crisis right now. I guess I can add that to the list of things I have gotten pretty good at.. dealing with crisis and weathering the storm. Will post write up as soon as things calm down.
 

Surf16

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Hitting stride now but still growing fast, 2019 should have us averaging 150k a week, right now i am at 75k per week.

I've learned a lot as we have grown, who has questions? Add them below and I'll answer (good questions only).

EDIT: SPECIFIC QUESTIONS RELATED TO YOUR OWN STARTUP OR BUSINESS, NOT RELATED TO MINE.

EDIT EDIT: A few current fun facts for everyone:

1. Current Age: 29
2. Xmas gift to myself: Topre Keyboard
3. Drink of choice: COFFEE x 1,000
4. Current work schedule: Mon - Fri 4am to 5pm and Sat 10am to 6pm
5. Current ride: Your mom

Since you provide a service not sure you can answer this but here it goes...

My partner and I are in the product development stage of our product.

We have found a need that solves an every day problem. We both believe this product will impact millions.

I know MJ says an idea is just that... an idea, but it is the execution that makes it a product.

I am going on forums in the niche and asking people if they would be interested in the product and/or have a need for it and would buy it in the future.
I haven't 100% stated on these forums what the product is or how it works but basically talk about the problem it solves.

My question is do we need to get a patent before we involve a freelance product designer or start talking to manufacturers?

I would like to describe the exact product and talk about the problems it will solve to a test market. But worried that somebody with more money to invest or a big company will take our idea and run with it.

Thanks.
 
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458

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Since you provide a service not sure you can answer this but here it goes...

My partner and I are in the product development stage of our product.

We have found a need that solves an every day problem. We both believe this product will impact millions.

I know MJ says an idea is just that... an idea, but it is the execution that makes it a product.

I am going on forums in the niche and asking people if they would be interested in the product and/or have a need for it and would buy it in the future.
I haven't 100% stated on these forums what the product is or how it works but basically talk about the problem it solves.

My question is do we need to get a patent before we involve a freelance product designer or start talking to manufacturers?

I would like to describe the exact product and talk about the problems it will solve to a test market. But worried that somebody with more money to invest or a big company will take our idea and run with it.

Thanks.

Patents take forever and cost a lot of money. It is better use of your time and money getting something/anything put together and then test the market to see if there is actual demand there. Filing a lot patents just to protect your interests isn't a skill set to acquire on your first venture, its a waste of time. It doesn't really teach you anything about design, production, testing, selling, etc. You need to make a lot of mistakes to learn what you are doing, filing patents doesn't give you that opportunity.

Again, I am only speaking to your first at bat. Later on when your Ms. QVC you can have your attorney on retainer filing patent ideas that popped into your head during lunch..
 

CareCPA

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I'm still anxiously awaiting the write-up. I obviously run a service business, and am still trying to figure out the puzzle of scaling (mainly, getting in front of my target audience). Once we see your area of expertise, I'm can narrow down my questions.
 
G

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2. A total industry market cap for the product or service between 100m and 500m USD (You do not want to compete with large corporations, you will lose)

3. Something with few competitors (There should only be 2-3 big players and your research determines they have a lot of weaknesses and are lazy with there operation. IE. You call, get put on hold, transferred 10 times, and the person you finally speak to just learned English)

Have a couple of questions based on this.

The first question is...
At what point to you decide to get out of a business and do something else?

I don't mean getting out of a business because it got hard...

I mean deciding to hop out because the model simply doesn't meet your criteria.

For example, I could be at risk of being in the wrong business because it doesn't check the Market Cap and Competitor criteria. I'm in a market with a fuzzy/low market cap (#1 competitor is only estimated at $1.3MM/y revenue), and there's more than a dozen Competitors who are doing exactly that...Competing and effectively commoditizing the service we offer.

The second question, going off that...
What would you do in this market, given those challenges?

Blue Ocean Strategy answers this question by asking a reader to find an angle that makes the competition irrelevant. For example...

-This service could be realistically automated by AI, and give a customer something instantly.
-Everyone in this market fulfills orders in 72 hours as a standard. Why don't we do 12 Hours, for everyone, at the same or lower price than everyone else?

Given those challenges, would you do the same? What else would you keep in mind in a market with a low market cap and fierce competition?
 
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458

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Have a couple of questions based on this.

The first question is...
At what point to you decide to get out of a business and do something else?

I don't mean getting out of a business because it got hard...

I mean deciding to hop out because the model simply doesn't meet your criteria.

For example, I could be at risk of being in the wrong business because it doesn't check the Market Cap and Competitor criteria. I'm in a market with a fuzzy/low market cap (#1 competitor is only estimated at $1.3MM/y revenue), and there's more than a dozen Competitors who are doing exactly that...Competing and effectively commoditizing the service we offer.

The second question, going off that...
What would you do in this market, given those challenges?

Blue Ocean Strategy answers this question by asking a reader to find an angle that makes the competition irrelevant. For example...

-This service could be realistically automated by AI, and give a customer something instantly.
-Everyone in this market fulfills orders in 72 hours as a standard. Why don't we do 12 Hours, for everyone, at the same or lower price than everyone else?

Given those challenges, would you do the same? What else would you keep in mind in a market with a low market cap and fierce competition?

The answer to your first question is usually as fast as humanly possible without hurting yourself. However, there are way too many variables to answer this questions in the way it is presented. You may have missed something in your analysis for example. There might be a whale in the space bringing in $100m in revenue, your just not aware of it. As it pertains to an entrepreneurs first real venture, success in any form is going to be better for you in the long run no matter how small. Confidence builds on itself.

In regard to your second question, the answer is still about the same. Get out as soon as humanly possible with a small win under your belt. Human beings always over estimate there ability and under estimate short comings. Almost everything related to success revolves around probabilities. Therefore, the equation you need to answer for yourself with true objectivity is: "What is the probability of my FIRST successful venture being in a niche that has fierce competition and a very low market cap?"

If you are truly objective about answering this probability question, you'll come to the realization that your time is better spent elsewhere on something with a higher probability of success. Time and energy should always been your focus, never dollars and cents.
 
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458

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I am still dealing with a mini crisis but there is light at the end of the tunnel and we will come out stronger.

One thing you always learn over and over again as an entrepreneur is you can never build enough fail overs for all your processes. IE. Always have multiple bank accounts, two ISPs on a fail over router, back up merchant accounts, etc etc. It is always time well spent building these fail overs into your operation because without fail, you will use them eventually.
 
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Jonathan Hoch

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I am still dealing with a mini crisis but there is light at the end of the tunnel and we will come out stronger.

One thing you always learn over and over again as an entrepreneur is you can never build enough fail overs for all your processes. IE. Always have multiple bank accounts, two ISPs on a fail over router, back up merchant accounts, etc etc. It is always time well spent building these fail overs into your operation because without fail, you will use them eventually.
From what I have seen, I have no doubt you’ll overcome your situation with a good solution.

On the race track, the man with the fastest car usually stands on the largest pile of broken parts. Failures point out the weak points of your system. It’s your job to figure out how to fix them.

On the topic of redundancy, I agree a thosaund times over. It is something that is always overlooked, and under appreciated, until you need to rely on it.

In the USMC infantry, we were taught everyone’s job 3, 4, and sometimes 5 ranks up the chain of command. In war, people die, and the mission needs to be completed. Being a Private First Class, you are still given the mission critical information that is given to the platoon commanders.

The chaos of battle could take out any of the chain of command, and you never know who’s going to freeze in battle. The point, is redundancy is what has kept the Marine Corps successful for 236 years. And it should be what is used to keep your business running at all times even when you don’t think you need it.
 
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YoungPadawan

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When you're selling your high ticket items, do you first sell something that costs less to get your foot in the door with your customer/build their trust? Or do you go straight for the $1,000 - $5,000 sale?
 
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jimmeboy

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One thing you always learn over and over again as an entrepreneur is you can never build enough fail overs for all your processes. IE. Always have multiple bank accounts, two ISPs on a fail over router, back up merchant accounts, etc etc. It is always time well spent building these fail overs into your operation because without fail, you will use them eventually.

Excellent advice!

Ask yourself questions like... What effect would it have on your business if your payment processor/PayPal blocked your account in the lead up to your peak season after having just landed a massive order from your suppliers? You can't trade. Your funds are locked. You're pretty f'd! Now, what if you had a backup merchant account ready to go? Different story!

The above example happened to me. I had over 300k locked in a PayPal account for 3 months. It almost destroyed my business to the point where I was on the verge of shutting down. I persevered, and eventually retrieved the funds. What was the first thing I did next? I set up multiple merchant accounts as backups with different providers/banks! And yes, it happened again, BUT I was prepared and it didn't effect the business by more than the time (<1hr) it took my developers to change some code to switch processors.

I went on to continue incorporating "fail overs" into the business wherever possible. Additional staff. Multiple servers and backups. Developers. Etc... I was determined not to let something like that happen again.

Just go and do it. And, hopefully you feel it was all a waste of time! But if the time comes, you'll be back here repping the sh!t out of @458 's post.
 

JunkBoxJoey_JBJ

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I'm still anxiously awaiting the write-up. I obviously run a service business, and am still trying to figure out the puzzle of scaling (mainly, getting in front of my target audience). Once we see your area of expertise, I'm can narrow down my questions.

@CareCPA - I am still reading this book (won in the giveaway and wanted to finish Goggins first) about halfway through and this sounds like something you could use.

https://www.thefastlaneforum.com/co...eve-explosive-growth.85667/page-3#post-746730
 
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CareCPA

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@CareCPA - I am still reading this book (won in the giveaway and wanted to finish Goggins first) about halfway through and this sounds like something you could use.

https://www.thefastlaneforum.com/co...eve-explosive-growth.85667/page-3#post-746730
Yea, I sent it to you, I won the other one.
It's on my list, I just need to be more deliberate about making time to read things that are actually beneficial to my company. I get so busy "doing" that I don't take a step back to grow.
 

458

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When you're selling your high ticket items, do you first sell something that costs less to get your foot in the door with your customer/build their trust? Or do you go straight for the $1,000 - $5,000 sale?

Absolutely. First sale runs between $300 - $600 and is accomplished most of the time through two calls. First is the cold call opener and pitch where we grab there email and set the follow up call appointment to close. Next we send our prospect all of our information through text and email on who we are, what we can do for them, and why they should go with us. Last we call them on the scheduled appointment time and if they answer 9/10 will close on that second call.

The rest of our prospects that do not answer and close on the second call are loaded into our marketing campaign funnel and contacted 3-5 times per week through unique and original sales copy using Aweber and texting.

We close deals weekly with people we spoke to only one time back in 2016 or 2017 and finally called in off our Aweber campaign ready to go. They may have been called, texted, emailed hundreds of times and never responded to us but for whatever reason, now is when they pop up and close. Never give up..
 

458

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Excellent advice!

Ask yourself questions like... What effect would it have on your business if your payment processor/PayPal blocked your account in the lead up to your peak season after having just landed a massive order from your suppliers? You can't trade. Your funds are locked. You're pretty f'd! Now, what if you had a backup merchant account ready to go? Different story!

The above example happened to me. I had over 300k locked in a PayPal account for 3 months. It almost destroyed my business to the point where I was on the verge of shutting down. I persevered, and eventually retrieved the funds. What was the first thing I did next? I set up multiple merchant accounts as backups with different providers/banks! And yes, it happened again, BUT I was prepared and it didn't effect the business by more than the time (<1hr) it took my developers to change some code to switch processors.

I went on to continue incorporating "fail overs" into the business wherever possible. Additional staff. Multiple servers and backups. Developers. Etc... I was determined not to let something like that happen again.

Just go and do it. And, hopefully you feel it was all a waste of time! But if the time comes, you'll be back here repping the sh!t out of @458 's post.

Another largely overlooked fail over is actually cash on hand. A big misconception and mistake in my opinion is the belief that cash in the bank is worthless because it is not earning you interest and therefore it should all be deployed.

In some businesses this may be true but when it comes to start ups that are self funded and have little outside support, cash reserves are absolutely vital. If it wasn't for the cash reserves i keep, this mini crisis would have literally put me out of business in a matter of days.

Cash buys you time to make mistakes, deal with crisis, fix mistakes and carry on from there. Lack of cash flow and bad cash management probably kills more startups than anything else in my estimation.

If you know the story of Rockefeller, you would know that one of the biggest lessons he learned from his father is never put out more cash than your callable loans because a day will come when they are called and you won't have the cash on hand to pay and therefore at the mercy of your creditors to liquidate your business and take control of your assets.

Cash is king.
 
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458

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I'm still anxiously awaiting the write-up. I obviously run a service business, and am still trying to figure out the puzzle of scaling (mainly, getting in front of my target audience). Once we see your area of expertise, I'm can narrow down my questions.

Coming to you Monday (I hope lol)
 

eliquid

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2. A total industry market cap for the product or service between 100m and 500m USD (You do not want to compete with large corporations, you will lose)

Hey @458 , How do you find these numbers out?
 
G

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The rest of our prospects that do not answer and close on the second call are loaded into our marketing campaign funnel and contacted 3-5 times per week through unique and original sales copy using Aweber and texting.

3-5 times a week? Holy...

And you've found this frequency of contact beneficial and not a turn-off to leads?

Fascinating. My guess is the copy is a spun template you guys developed?
 
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458

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Hey @458 , How do you find these numbers out?

For market niches made up of mostly private companies, it is not an exact science. Start with finding all of the industry leaders in the Inc 500/5,000 list. Next put together a list of all the companies you can find in your specific niche along with there corresponding employee head count. Use the revenue and employee count from the companies reported in the Inc 500/5,000 list to determine average revenue brought in per employee. Next multiple this number times the total employee count you were able to determine. Next multiple this number by 2 and you now have a conservative estimate of market cap for a non publicly reported industry.

After you have the above number, look around the internet to see if you can find other information on what the estimated market cap of the industry is and use those numbers to determine if you are close in your estimation.

Again, it is not an exact science and there are probably other ways to come up with your estimate that i may not be aware of, this is just an example of how i did it for my current venture (IE. A niche market cap of 100-200 million USD).
 

458

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3-5 times a week? Holy...

And you've found this frequency of contact beneficial and not a turn-off to leads?

Fascinating. My guess is the copy is a spun template you guys developed?

We do not "spin" content, that doesn't work. I have a professional sales copy writer on retainer at $125 an hour.
 

458

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I appreciate your apology, that speaks a lot about your character over all.

To help get this thread back on track, and potentially become a gold thread...

Can you give us a bit more clarity on what you excel at in detail? (maybe a mod can add the snippet in the OP)

You've stated a high ticket item and you lead the sales team, but maybe explain a bit about what you excelled at to get you there.

Was it hiring and inspiring the sales team?
Building sales team infrastructure?
Cohesion between sales and production/fulfillment?

Anything that can narrow us in to how we can ask calibrated questions that set you up to really help out these new guys?

Here are the top 3 skills/mindsets that I excel at which have been a common thread throughout my career as an entrepreneur for which have gotten me where I am today:

1. Delegation & Offshoring

a. Delegation - 90% of everything done within my business is now done for me on my behalf without any type of micromanagement, and I continue to offload work every single day. I have always been very savvy when it came to seeking out the best talent that my money could buy and then delegating the work to them without micromanaging the process. If delegation did not work for something then i would look to 2c or 3b below.

b. Offshoring – Not everything should be handled in house. There are many functions better suited for full time off shore staff. I currently employ around 15 full time off shore staff that truly excel at the tasks given to them. If I tried to employ in house individuals to do these tasks it would cost three times as much money and they would not be happy performing the tasks therefore resulting in high turnover and decreased morale. The task given always needs to be paired with the right individuals or else failure is certain but not always because the task is flawed but because the wrong person was assigned.


2. Technology & Lean Loop System Building

a. Natural Ability - I have a natural talent for computers and systems. In the early 90s when I was around 7 years old, I asked for a PC for Christmas before the internet was even a thing. The next day after Christmas the computer was still in boxes since not even my parents knew how to assemble it. Without asking them or supervision, I took it all out of the boxes and assembled it myself and began using the computer. Without computers and the internet I would definitely not be here today.

b. Investment Mindset – For a very long time now I have consistently invested in the best of the best when it comes to technology (Both hardware & software). My organization runs the best of everything. One example of going above and beyond is our direct line fiber connection. It took over 6 months to get it installed and costs me an arm and a leg; but guess what? We haven’t dropped a single phone call since.

c. System Building & Trial/Error Mindset – Everything within my organization is a system that everyone relies on to function each and every day. These systems have been built and assembled together over time by myself and the looping feedback that comes from everyone in the organization. This feedback loop usually comes from problems that arise and questions that follow. If a problem arises, then the first question I ask myself is: “Did this problem arise from an issue with our system or something else?”. If it is something within the system then the loop continues into additional questions such as: “Should an adjustment be made? What should be adjusted and when?” and on and on until an adjustment is rolled out and tested/monitored. This loop mention of adjustments never ends and is carried out with every single function of the business into infinity. No system or adjustment is ever agreed to be for forever. The second something has ability to be improved is the second it is improved. Anyone that is a threat to this type of thinking is eliminated in short order. A lot of employees might find improvements and adjustments draining and annoying because most people don’t like changes, these employees should be fired.

d. Stop & Lock In – There is a point of diminishing returns and everything needs to be locked in and tested for a good period of time before additional adjustments are made. It is important to understand that changes, no matter how small, always cause slow downs in momentum and workflow. Therefore it is important to always make sure that your adjustments are well founded and necessary along with locked in for a good amount of time before any additional adjustments are made.


3. Culture of Excellence

a. Hiring Only Excellent Talent – It is a time consuming and frustrating process that over time will pay the most dividends but only if you consistently follow the next step of firing everyone. Many times when you hire someone you believe will turn out as a star talent often turn out to be duds. This happens often but there is no way around trying someone and seeing if they can fly or not. This goes for both employees and contractors.

b. Firing Everyone – Almost everyone that is, you want to only keep the excellent hires and fire the rest. I have found that very few business owners and entrepreneurs are good at firing staff. I on the other hand am extremely gifted at this. I couldn’t care less about firing any person and I have always excelled at immediately firing any person that is not a good fit. Most organizations hold on to mediocre staff far too long and in the process hurting morale and the organization as a whole.

c. Automatic Culture - By doing the above two your culture of excellence will form over time. This culture of excellence will allow the number 1 and number 2 above to grow exponentially over time. Therefore, system implementation and delegation suddenly become effortless because everyone is naturally for growth and adjustments and will to take on more tasks through your delegation.
 
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458

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love bump
 

Process

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What process for getting upsells and referrals from existing customers do you recommend?
 

458

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What process for getting upsells and referrals from existing customers do you recommend?

The best way to get an up sale is to do an amazing and outstanding job on the first "get them in the door small sale". This is not to say that you do not want to have an amazing product or service on the second or third sale. It just means that if you promise X on sale number one to get them in the door, you should actually give them 1.5-2X even if it means you breakeven or lose money on the first sale.

However, this will only work if your follow up game is on point for up selling and referral requests. Asking one time per customer is not a strategy, its just being lazy. We follow up until they say stop, its just about finding the right mix of medium and frequency for your specific niche. Obviously asking for an up sale on Christmas lights in July is just going to piss off everyone on your list.
 
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458

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458 will be the richest guy on the fast lane forum and possibly a billionaire one day.

Haha, maybe but that isn't my intention.. I enjoy the game more than anything, the money is nice though but being a b guy isn't a goal of mine. If I had that much money i would probably donate most of it, too much of anything is always too much, no matter what it is.
 

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For market niches made up of mostly private companies, it is not an exact science. Start with finding all of the industry leaders in the Inc 500/5,000 list. Next put together a list of all the companies you can find in your specific niche along with there corresponding employee head count. Use the revenue and employee count from the companies reported in the Inc 500/5,000 list to determine average revenue brought in per employee. Next multiple this number times the total employee count you were able to determine. Next multiple this number by 2 and you now have a conservative estimate of market cap for a non publicly reported industry.

After you have the above number, look around the internet to see if you can find other information on what the estimated market cap of the industry is and use those numbers to determine if you are close in your estimation.

Again, it is not an exact science and there are probably other ways to come up with your estimate that i may not be aware of, this is just an example of how i did it for my current venture (IE. A niche market cap of 100-200 million USD).

Hey @458

Still have some questions on this, thanks a lot for expanding on this.

When you’re listing out the companies in your niche (competitors) to do some estimates on industry market cap, are you only listing out the ones in your geographical area that you are serving? Essentially, finding the industry market cap for just the zone you will be operating in. Thus, if I were only servicing a local metropolitan area, that’s the only industry I should consider.



On another note, have you found success in other channels apart from direct sales? Are there any other particular channels you would recommend, or solely focus on one (direct sales) for a service business.



Thanks again


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458

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Hey @458

Still have some questions on this, thanks a lot for expanding on this.

When you’re listing out the companies in your niche (competitors) to do some estimates on industry market cap, are you only listing out the ones in your geographical area that you are serving? Essentially, finding the industry market cap for just the zone you will be operating in. Thus, if I were only servicing a local metropolitan area, that’s the only industry I should consider.



On another note, have you found success in other channels apart from direct sales? Are there any other particular channels you would recommend, or solely focus on one (direct sales) for a service business.



Thanks again


Sent from my iPhone using Tapatalk

I would caution putting to much emphasis on market cap as a signal to be in or out of a specific niche. It is not a tool to gauge whether you have or can have a competitive advantage, it is only used as a rough estimate to ensure you are not getting into a niche that is so shallow there is little chance you'll be able to scale and grow into an enterprise versus a one man show. Its a quick rough estimate calculation:

1. Are there other people in this niche or a very similar niche?
2. How many?
3. How large?
4. What public data is there on these large organizations?
5. Run a rough estimate calculation
6. Commit or move on.

This is only done AFTER you have established that you do have some type of competitive advantage that justifies even attempting to be in this space. Anyone can print T shirts with funny images on them, just because you can to doesn't mean you should be there.

In regard to your second question, yes, in direct mail but the margins are tighter and its harder to gauge what works and doesn't work in a short amount of time. You have to spend a lot and wait a long time to dial in a campaign for the most part. On the phone your stats are live and in real time so its easy to see what works and doesn't and then adjust.
 

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This is only done AFTER you have established that you do have some type of competitive advantage that justifies even attempting to be in this space.

Awesome insight, thanks for this specific detail.


Which form of competitive advantage (ie operate at lower cost vs competitors, or command a price premium, or perhaps both) did you decide to go after, and why?


From what you’ve shared it sounds more so that you went for lower costs, by 1) really dialing in your sales and marketing to be closing deals very effectively and efficiently, 2) keeping your delivery and operations lean and efficient to the point of quality you are aiming for, and 3) post-sales service in which you mentioned you continue the customer relationship beyond the first sale for opportunities to upsell by knowing more of their needs and how to bring them more value.


Was that the case at your company? If not, how did you see it?


Which other forms of competitive advantage have you found are likely present in many industries today because the status quo has them complacent and comfortable?


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