Smart entrepreneurs find a way to take risks without betting the farm.
As I reported in this week’s IBJ, small-business owners increasingly are adding products and services to keep revenue flowing during difficult economic times. (Read the story here.) Butler University’s Jim McKneight calls it a low-cost, low-risk way to grow.
He and other experts recommended that businesses survey existing customers to gauge their interest in potential add-ons, then pay attention to the reaction in the marketplace. If an idea doesn’t work, try something else.
But the strategy isn’t for everyone. Indeed, some entrepreneurs take the opposite tack—narrowing their focus to establish expertise in a few core competencies.
Carmel marketing firm Roundpeg is eager to help clients design and fine-tune their websites, for example, but refers them elsewhere for e-commerce work. Owner Lorraine Ball said profit is up 75 percent since her team made the decision to specialize.
McKneight said both approaches can be successful but acknowledged that it’s often difficult for an entrepreneur to turn away paying customers.
What do you think? Which approach makes the most sense to you and why?