“The biggest mistake I’ve made and how your business can learn from it.” by Jonathan Montgomery, Real Estate Coach
I’ve been in real estate since 1998 in just about every aspect that one could imagine.
I’ve done everything from owning a brokerage, to appraising, to investing, and now I enjoy teaching agents nationwide how to grow their real estate businesses.
So believe me when I tell you that I have made a ton of mistakes. I often teach my coaching members the lessons from my mistakes, but the reality is that the same principles apply to any small business.
However, I want to share with you one of the biggest mistakes that I’ve made in my career and how you can learn from it. This mistake is quite easy to overcome, once you understand what it is and how to identify it. I want to share with you the keys to overcoming this major hurdle.
But first…what is the mistake? GIVING THE BUYER TOO MUCH POWER.
This can manifest itself in a myriad of different ways and it’s easy to have this problem when you are starting out in a new business venture. It usually looks like the following.
The small business owner opens their doors and begins to look for customers to buy their product or service. They soon discover that this can take a lot of energy, money and time. Also, of course, this process includes a lot of rejection. However, along the way, they are able to get a few customers here and there. In an effort to bring in more customers, they begin to expand their product line in hopes of attracting more customers.
And then it happens…They get a customer that is willing to spend a lot of money with them for a period of time and it’s time to roll up the sleeves and make sure the client is happy and happy for a long time. Then the customer makes an unusual request that requires a tweak of services, just a bit. Then comes another request. This tweak involves adding to the service that was originally offered, but wasn’t negotiated in the price. This second tweak adds to the workload of the business owner. But, it gets done.
By now, you may be guessing that you know where this story is headed, but the reality is that it can happen in many ways. But, the dangerous part is still ahead. Changes occurred and my customer lost their account with their customer, which means that they no longer needed my services. This scenario happens all the time in the world of small business. In my case the buyer had too much power. They were adjusting my business model by making a simple request and they represented too large of a percentage of my business’ income. In short, my business suffered for my decision to cater to them as their business began to change.
Here are some strategies that you can use to help you overcome that “over-powered” customer.
Strategy Point #1) Have A Laser-Focused Niche.
First, choose a niche.
Your customers will be drawn to you because of your niche. So, choose a niche that has a lot of potential customers. I highly recommend that you make your niche as narrow as possible. This is very challenging to most business owners because of the fear that they may be missing out on an opportunity elsewhere. On the contrary, my friend, your niche will identify you as an expert, the expert.
For example, I once marketed myself as an expert on downtown Denver lofts (not apartments, brownstones, or condos). On my website was info about all the lofts for sale in Downtown Denver. My customers were able to find me by searching Denver Lofts in Google and I ended up at the top of the first page. I worked with tons of people searching from out-of-state for lofts in Denver. Many other people saw my marketing and figured I could help them with their real estate needs too. And I did.
Do not be afraid to have a small niche that has lots of potential customers.
Second, choose a niche with little competition.
You will have a true advantage if you know that you are able to get a solid foothold in the niche that you are considering. I am in real estate and everybody knows somebody with a real estate license. But there are few agents that are marketing themselves as specialists in Denver lofts. So it has been quite easy to get a foothold in that niche. Do the same for your business.
Strategy Point #2) Don’t Stop Marketing Your business.
In other words, always get more customers.
This can be a crucial mistake for many small businesses. When times are good, it’s easy to set aside your business development efforts and focus on the business that you have. But remember, the goal is to not have one customer that has too much power. There is no better way to solve this problem than by having lots of customers. Furthermore, when times are bad, it’s an even BETTER idea to do more business development. Why?
During tough times many small businesses cut back on business development efforts such as marketing and your competition will likely do the same. In good and bad times stay above the rest and you will have a greater opportunity to stand out among your competition.
Strategy Point #3) Hire People.
You can hire people either as employees or contractors, but hire talented people to be part of your team. These talented people should be able to manage the processes and operations side of your business successfully. Do not be the business owner that feels like other people can’t work their business the way that you can because you will not be able to push past your glass ceiling and grow.
Think about it. Does it make sense for me to design my logo; which means buying software, learning the software, getting some art skills, and then trying to create an actual logo? Or does it make more sense for me to hire somebody else with all the tools to get this done quickly and efficiently.
Strategy Point #4) Use technology
When it comes to technology, it excites me to see how much a business can accomplish more than ever before. Over the past 10 years, technology has grown by leaps and bounds. A small business owner has the ability to now do things that once required a computer science degree and a Hollywood production studio. And it continues to grow every day.
Embrace technology in your business. Use it to your advantage to leverage your message to reach and grow your audience. Remember your audience is your customer base. Technology can enable you to reach them more effectively and allow you to serve them better, so that they will continue to be loyal to your brand.
Good luck and I wish you much success!