A friend inboxed me complaining about her sector becoming over flooded by competitors. She was greatly worried as competitors were taking a large slice of the cheese from the sector she was a pioneer.
Let’s get this correct…in Zimbabwe opportunities generally last for 3 months before most reverse engineer and figure out your secret recipe. Where are you sourcing products? How are you selling? How is your business model structured?
You can hardly enjoy a monopoly especially for new opportunities beyond 3 months….its’ the way it is and you should always factor this in your business strategies.
So what strategies can she employ to keep her head above the water in a pool recently joined by sharks?
In come the ladder steps concept,
Level one: A good friend of mine started baking fancy cakes around 2009 and she became a hit around the capital. She literally had a monopoly of home baked cakes but with time competitors entered the scene for their own share
Level two: Instead of complaining about being copied, she maintained her market in a fast shrinking sector but later on innovated and moved up the ladder to conducting training for ladies interested in baking. She offered well attended training classes for several months before realising that some of her trainees were becoming rivals who were setting up own training institutes. It did not take much time before the market was flooded.
Level three: If other students copy you at school, the easy strategy is to ride solo-study alone, be selfish with knowledge and let your hard work and intelligence reflect in end of year exams. You can report to examiners anyone employing unethical conduct during exams! In business, especially in Zimbabwe, for small businesses-you have no avenue for reporting. Your solution is innovation and moving up the ladder.
She stepped up the ladder and maintained her cake business and training plus added a new portfolio of supplying baking supplies such as flour, recipes and equipment. She developed solid relationships with suppliers in South Africa and for a while enjoyed her time in the sunshine. By now you should have figured out that competitors soon flooded the sector too?
Level four: Yes the competitors followed her footsteps in level 3 prompting her to innovate too and climb another step of starting another industry in Namibia where once in a while she was invited for special training classes and also supplying inputs.
Through innovation and moving up the steps, she increased her profits despite the opening of floodgates. She looked at the bigger picture of the value chain and explored untapped opportunities.
Instead of complaining about dwindling profit margins due to new competitors stampeding to join her sector, she welcomed them with open arms and viewed them as partners.
Now this concept is used to manage competitors but guess what?
You can also employ it when investing in any venture of your choice. Invest in level 1 or enter at level 2 with the intention of moving to level 3 and above. Rear broiler chickens or produce poultry feed?
Carry out online trainings or develop online training infrastructure?
This should be a familiar concept if you read our debut book in 2018. Our books cover opportunities and entrepreneurship concepts.
We welcome your feedback
Kea leboga
