Growing Small Businesses

Lesson 2: Positioning your product or service

Making money by delivering best value

In the end, your prospective customers will all do the same thing: they'll add up how much value they are going to get out of buying from you and they will set that against how much they're going to pay and how much effort it is going to be. They'll compare that with what they can get from some other suppliers and they'll buy from the one where the overall value is the best. At this point the overall value you're offering has to be better than anyone else's.

Once they've made their purchase they will repeat the exercise to see if they received the value which they anticipated. You've put a lot of effort into getting this customer and it is going to be a lot more efficient to keep him for future business than it will be to lose him and to have to get another one. As a result, you have to make sure that the value the customer receives is at least what you led him to expect. To ensure repeat business and happy customers, the value received should even be a little bit better than expected because there is nothing customers like better than to get something extra for free. If you can ensure that you offer top value and then deliver a bit more, your business will boom in no time.

To make sure this equation works, everything has to match and you have to make sure it does. What the particular group of customers have in common as a need with characteristics which they value greatly has to match what you do best and what you can produce at the lowest cost. Then all you have to do is let them know you're there - they'll be calling you with the orders when word gets around.

While it is not always possible to achieve the perfect match, getting closer and closer is just a matter of research and work. The closer you get, the easier it will be to grow your business. After all, you're in control of what you produce and who you want to sell to. You should be able to get a pretty good match between the two without too much effort. And the great thing about it is, everyone involved wins.

Your customers get exactly what they need at a fair price. You get to do what you do best and you get paid what it costs plus a fair profit. Your competitors can't or won't get in your way because they see that they couldn't do what you do as well or at that price. And, because your customers buy great value and get even more, they stay your customers and your business grows steadily as you add new customers without losing any.

For more on growth strategies and details on how to close the circle and deliver value to your customers in return for business, try our recommended resource, "Navigating the Marketplace: Growth Strategies for Your Business." It gives more specific advice on how to structure your business for growth and how to build on competitive advantages.

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