Suddenly, the shish kebabs don't seem so savory, and you leave the club empty-handed, dazed and depressed, wondering, "How can I compete with that selection and cost?"
Competition comes in all shapes and sizes, and there's another truth: every gift basket seller is not your competitor.
There are designers who live in your region and possibly on your block. They are your direct competition, the ones you must watch incessantly. They are small and/or homebased. They are after the same clients you have and want. They struggle with the same types of problems that you are also trying to solve or haven't yet experienced.
Then there are retailers who happen to sell gift baskets. This group is known as indirect competitors (Macy's, clubs, specialty stores, etc.). Their inventory is composed of thousands of products. Gift baskets are a small component of the inventory. Indirect competitors sell cookie-cutter gift baskets, the kind that look alike. Indirects don't deliver and won't let you customize anything. You like it, you take it, goodbye.
The next time you become rattled when seeing a store's gift baskets, ask yourself:
Don't let the retail price fool you. Each store's buyer purchases goods for hundreds of stores within the chain. When you start ordering merchandise to fill hundreds of stores, along with leasing space the size of football fields and hiring thousands of workers, then you can also price your baskets between $15 and $30, just like the retailer. Until then, keep your eyes on the direct competition. She's just down the street making a gift basket for a client that should be yours.
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