Spitting Chips
Lee and Sue* run the local take-away food shop. They work 14 hours a day, 7 days a week, 51 weeks a year. It’s hard labour in a tough suburb, and I admire them.
Tactically, they’re nailing it. With such a phenomenal work ethic, prosperity must surely be theirs.
Yet with no time for strategy, they almost came unstuck the other month.
Threat
Walking home from town I passed a building site. The board out the front said a new fast food shop was coming.
This site was directly opposite the housing commission flats (projects). I knew these towers held Lee and Sue’s main demographic. I also knew that, with a homogenous product like fast food, these clients would happily ditch Lee and Sue to dine 300 m closer to home.
Action
I alerted Lee and Sue, using animated sign language that startled some passing children.
While I wasn’t sure my warning had got through, the couple thanked me and gave me a free dim sim.
Result
Last week, Sue told me she’d sent her son to read the board. On realising that a huge slice of their customer base was at risk, they’d composed a letter to the council.
It now seems the new building will be used for office space.
Conclusion
I’ve often heard phrases like ‘sweat equity’ and ‘working smarter not harder’. This example shows the extreme danger of keeping your nose too close to the grindstone.
Oblivious to a major threat just two blocks from their enterprise, Lee and Sue’s years of striving could have come to naught.
Recommendation
We’ve learned that it’s vital to rest and take holidays. On your next break, take a turn round your (actual or virtual) neighbourhood.
A strategic, 15-minute power walk could save your bacon!
* Not their real names.
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Interesting story. A lesson worth keeping in mind.
Many thanks, Stephen. There ain’t a whole lot of community spirit in the inner east, but this couple is an exception.
Years ago, thieves broke into our car and stole all our change. When they dumped it on the counter at the fish and chip shop, Sue challenged them and they fled. We haven’t had a break in since!
What a woman!
This is such a familiar story, isn’t it? Small or big business, it’s so easy to get caught up in the day-to-day and put off the planning, which never seems as pressing. And then one day you realise you have no idea where you’re going or why.
Fer sure, Megan. I took up corporate copywriting to build a fighting fund that would free me to concentrate on my fiction.
The result was a ten-year corporate copywriting career, without a single new piece of fiction for the entire period!
Fortunately, I’m back on track now. But I very nearly exchanged my life-long dream for a lesser reality.
Or spitting pizzas, as the case may be
G’day Paul…well your capacity for nailing both relevant and timely topics continues to amaze me.
I’ve now been ‘in business’ (and I use that term very tentatively – http://blog.qdosology.co.uk/2009/03/18/delusions-of-a-self-employed-business-owner-pt-1/ – an article I like on the subject), for a grand 3 weeks.
It’s not the ‘competition issue’ presented here that is my concern per se…more it is the ‘head-down bum-up’ posture that resonated.
I believe that I have, in earlier blogs, mentioned my new-found capacity as ‘THE WEAKEST LINK’ of my business ( http://mybrc.myobnet.com/2009/09/24/gift-rap/comment-page-1/#comment-2890 ).
This is only reinforced by the fact that I am only ONE Person!
This topic highlights, for me, a so far inescapable dilemma:
There is an absolute plethora of ‘business success’ information available, all of which is all but useless unless one has the resources with which to assess it’s viability (research), and then IMPLEMENT IT (develop)!
Rest? Holidays? Hmmm! My current resources allow for the following viability assessment – NOT VIABLE!
On reflection, this is perhaps a poor comparison, as ‘Sue & Lee’s’ business is obviously established and viable (if you call 110 hours x 51 weeks per annum viable?..I don’t).
My business would not yet qualify even as a ‘business’; I’m still adapting the model having discovered shortcomings in the initial focus. Can I adapt? Of course I can. Will my society buy me the time to do so? That remains to be seen…so far, so bad…but you’ve seen some of the challenges I’ve faced already, and I’m still here.
And I’m not dead yet! Never give up, never surrender.
Cheers
Stephen G
Great post! So many aspects “got me thinking” about local businesses and our responsibilities as members of their community.
Their success has a snowball (we get lots of snow up here!) effect on our communities, and so does their demise. In my community in northern Michigan, we have a strong push to support local. Granted we could save a few dollars here and there by driving to the closest “big City”, but it sure is nice when we need something and it is only one block away.
The ease of internet buying and the building of “big box” shopping malls contribute to the erosion under the foundation of commerce supporting local small town businesses. A reminder I will take away from your post is fundamental, and it is incredibly self-serving as well – if we don’t support our local business community when we choose to shop elsewhere, they certainly aren’t going to be there when we need them. (When my bookstore was on main street I used to gently whisper this all day
)
Vote with your dollars, and vote with your feet. Get in there and patronize them. Go buy something from them, just because!
Thanks!
Cheryl C. Cigan
http://www.known.com
Dear Stephen. As you know, I have absolute confidence in your ultimate success.
But to be on the safe side, have you considered cloning? Or a retired police dog? An extra pair of paws in the kitchen could be a blessing…
Thank you for matching my heartfelt revelations with yours. And for giving me such a resounding shot in the arm every time you visit.
Hiya, Cheryl! Welcome to the Dark Side. That’ll teach you to linger too long in my Twitter stream!
I’m rapt that you visited us all the way from America. It would’ve been enough for you just to show up. But you’ve also made some fabulous observations from a perspective we’ve not yet enjoyed.
So I’m doubly grateful.
Excellent post, Paul! Having owned and operated my own businesses full time for 6 years now, this story resonated with so many of my experiences.
As a small business owner it was so easy to get caught up in the day to day running of our businesses and a few times we failed to take note of the strategic issues that were occuring around us – sure we noticed the effects, but failed to connect the individual problems with the bigger picture. This could relate to staffing, purchasing, stock and finances to name just a few.
Even just paying attention to trends in our own local market – a quick trip around the shopping centre we operated in was often an eye opener and even provided a spark of creativity to keep our business alive and flourishing.
Being able to step back and analysis the results for the month, purchasing trends, what was hot, what wasn’t – were often life savers. We were a franchisee and our Franchisor would provide purchasing recommendations each month – of course, we had to pay for the stock whether it sold or not. After some time, we were able to modify the recommendations and we noticed our sales and profits improve, whilst reducing our overall costs.
It really does pay for the Business Owner to ‘take time out’ and do some ‘naval gazing’ – or strategic analysis to make sure they are on track…. it is much to easy to get lost in the forest and not be able to see the forest for the trees!
Thanks for the timely reminder.
Hello, Charly, and welcome! It’s great to hear that we’re on the right tram. And even better to hear these principles described from your point of view.
It sure has been a good day for detailed, relevant comments. Thank you for taking the time to send yours.
Lee and Sue had a lucky escape and I’m sure it wont be that easy everytime. It’s certainly prudent (essential) to look around and know what’s happening in your market but equally important to ensure your business is bullet proof.
How? By building a satisfied and loyal customer base that will keep coming back to you because you offer service and value. If a new place opened up business may drop off for a while as people try the new place but if the foundations are there the loyals will come back.
The other strategy is to change your offer to meet the threat head on – what are they offering that will take your customers away and does it make sense to compete directly while adding more value?
Bullet proofing your business starts today, not when McKFC moves in next door.And if that happens to you Stephen you can drive your business around the corner!
Thanks once again for your expert insight, Malcolm.
I was wondering whether you could expand on how a bog-ordinary fish and chip shop could create a point of difference and loyalty sufficient to make people go out of their way to walk past another, closer fish and chip shop.
Surely a fried dim sim, thawed from a generic pack of 1000, is going to be the same wherever you go? Where and how could you add magic to this equation? Only if you have time, of course.
There are three fish and chip shops within a 5 minute drive of my house (one within walking) and let me tell you, they are all very different! In fact we drive to the farthest away because the flake is better quality (and more expensive as a result). It’s also the cleanest-looking.
Thank you, Megan. I once heard that if you can smell a fish and chip shop from the street, it’s no good – because that’s the odour of residual food particles frying in old oil. Does that mesh with your experience?
Product – Service – Quality
A basic, fundamental yet vital premise for the success of any small business. If the other business is a direct competitor (fish and chip shop) then the store needs to differentiate itself. Firstly we need to look at the demographic. If it’s main customer draw comes from the housing commission flats over the road changing to the business model to copy Doyle’s in Sydney ($50 fish and chips) may not be a great idea.
Price may very well be an issue but discounting is not the answer of they will have to work far longer and harder to make the same return they are now.
Product – what product is the competitor selling and what else would the market like? Can they bring other fish that just flake, offer grilled for the health conscious, hand cut the chips, offer a better selection of drinks, add coffee.
Quality – I hate fish and chips because they are a greasy mess from virtually every store I go to. It’s an industry standard of poor quality, old oil and dodgy hygiene. Change that. Replace the oil more often, offer a better quality fish at a slight premium, focus on the result – crisp hot chips and delicious chips. How much more does it cost to do this – not much. Maintain the flake, chips and dimmys at the market rate but offer a wider selection at a price and quality premium to capture a wider slice of the market.
Service – Engage customers and be friendly, offer a frequent buyers club and give them a stamp every time they come in with a free drink after 5 and a free meal after 10. This will keep people coming back. Make the store look nice and have it clean. Offer current newspapers for waiting patrons to read, have a small treat for the kids (small pack of lollies) and they won’t let mum and dad go down the road. Offer lunch packs to the local businesses – call in by 11.30am and have them delivered to site. This costs very little but adds a whole lot.
These are just a few ideas to demonstrate how differentiation can be easy and cost efficient. Anyone can chuck a free potato cake in but that wont do it, create a quality experience with your business, ask your customers what they want and provide it with a smile and keep the till ringing.
Bloody hell, Malcolm; this is fantastic stuff! It appears you’re in the correct profession!
Thanks so much for taking the time to lay it all out. The lolly pack is diabolical – and quite brilliant.
I think I might get me an old fryer from eBay and set up shop…
Great advice Malcolm. But I’m a bit worried about Paul’s revelation that smelly fish & chip shops should be avoided…usually it’s the smell that gets me in
!! Especially on the long walk home after a day at the beach…
Maybe you need to do a smell-off, Megan. Have a whiff of all three shops, and see if smell and quality are inversely proportional. I’m sure MYOB will happily spot you $30 from petty cash…
Great stuff Folks
Good to see you Charly
And Dear Malcolm…I’m agreeing again…this is getting scary…butt seriously, such advice as your good self (& Charly), have provided is a great help.
And yep, I’m fortunate that I have a business model flexible enough to drive around the corner…I would imagine that for me, competing head-on with another business might mean driving around a different corner and parking in their foyer?
Probably wouldn’t be long before some decidedly ‘Blue’ folk appeared, but it would certainly send a message (appropriate? perhaps not)? 
Anyway, for now I have far bigger fish to fry (Hey! Don’t pick on me…I waited…no one else used it ;-P )…like Cash Flow…but I moaned about that earlier :- )
So now I’m presented with yet another time/resource-eating-monster…whilst trying to refocus my business to improve short-term cash-flow, the other edge of that sword presents a similar dynamic to that discussed here…the time and resources involved in re-negotiating payment options with suppliers, essential services etc. E.g. I just got a Power Bill I can’t pay…I have phone bills I can’t pay, I’m behind in my rent (eviction notice served the other day), I have loan payments I can’t pay.
Why am I in this position? I have spoken of this at length in earlier posts…but in summary, because of over 6 months of delays mostly from Finance related organisations, the I got suspended from my only stable income – NEIS Program – after writing to Ministers etc, I have since been reinstated, but not paid yet. I’m deluged with a whole new level of compliances for that too…so with all this ‘Small Business Support’ is it any wonder that Small Businesses struggle so much and have such a high attrition rate?
Is the ‘Western Economy’ just a giant ‘Pyramid Scheme’? (Pyramid Scheme Defined: The people at the bottom, pay for the people, actions, mistakes, bail-outs, time etc at the top.)
Is therefore, the National Economy a ‘Pyramid Scheme’?
Is therefore the Commercial Sector any different? Are Small Businesses paying for the Large Businesses?
So what is ‘Small Business Support’ really? Shouldn’t we at least call a spade a spade and call it Large Business Support?
In the face of all of this, there is only one available strategy (given my current resources and circumstances) and it is this:
Never Give Up, Never Surrender! (I just loved Galaxy Quest…you may have gathered
).
I will simply continue until I either succeed or fall…and falling for me means getting a job working full-time for someone else…
Cheers
Stephen G
Dear Stephen, I’m really sorry to hear you’re doing it tough. I wish you could do a national range of postal pizzas that work like glow sticks: you crack them and they heat themselves.
On a serious note, is there any point you going to ABC TV’s Australian Story or a local radio station? Your tale definitely seems worth telling, but perhaps not via the more odious mainstream media channels.
If guts and grit the keys to success, you’re a shoo-in. I do hope that’s the case.
Coming from a family that buys, builds and sells these types of businesses, its all about the cleanliness of the shop. Fresh paint, new friers, new look menu with value packages and good service. As someone mentioned earlier, people will travel for good Fishnchips.
One of my uncles was still up to a year or so ago, pealing (by machine) his own potatoes. They tasted 100% better than teh frozen ones you get today. He also cut his own flake rather than get it delivered in frozen pieces. Makes a big difference to flavour and traffic.
Fantastic, Arthur! I really appreciate your contribution. Many thanks indeed.
Dear Paul,
Thanks for your kind and supportive thoughts once again Good Sir.
Funny thing is, I don’t think I’m doing it tough…I think that I’m fairly typical of small business start-ups.
My point is – Why? With so much money being spent on ‘notional’ small business support, is so little of that money made directly available to small businesses themselves…especially when and where they need it? It’s not like I need a lot of money…in fact, relatively very little…for me, the difference between ‘Tough Street’ and ‘Easy Street’ (and I mean REALLY Easy Street), would be $10,000 to $20,000. Not a big ask when placed alongside the Multi-Bazillion dollars being poured into the myriad ‘Small Business Support’ ‘Schemes’ available.
And yes, I know there are a bazillion funding avenues for small business and start-up ventures…but you know what I need to access them don’t you?…Yep! Money that I don’t have! Who is going to lend to a small business that is in debt, trading, but not yet creating enough turn-over to balance its books? Unless I’m able to tick all the ‘STANDARD’ financial institution, government backed ‘boxes’, you can forget it.
I’m not saying this stuff because I’m pissed off or because I think I’m in some way original…I’m saying this stuff to invoke conversation…because I reckon it needs to be said over and over until it can ‘actually’ addressed. I hardly expect it to make a difference to my current and/or immediate circumstances (clearly, only I can do that), but it may spark a conversation that helps others.
And I have endeavoured to used this fine blog to provide a ‘warts n all’ account of my business…this is just a particularly ‘warty’ bit
…like all things, it will pass…and no one will die…it’s just unfortunate that many organisations and people act as if someone will.
Onward and upward.
Cheers
Stephen G
PS Actually, it’s funny that you mention a National Range of Postal Pizzas. The refocusing of my business includes making cold pizzas available through retail outlets (small shops to start). This of course invites the possibility that I may indeed be less restricted geographically…stay tuned
Thanks for the illumination, Stephen. I’ve heard a lot of good things about micro loans.
On one side, you have poor folk in war-torn countries who could die from plague at any second.
On the other side, you have kind souls ready to lend them a tiny bit of cash for a cow, a bag of seed or somesuch.
Pretty shaky ground. I don’t know if MacQuarie would endorse it (or maybe it’s EXACTLY what they’re after these days). But it all seems to go swimmingly, with no broken hearts.
Can it be so hard for an entire first world continent to pluck one pizza guy from the muck and set him on a knoll until he dries off and toddles away to do his thing? I don’t get it…
Re: “Can it be so hard for an entire first world continent to pluck one pizza guy…?” Short answer? No! Not if the pizza guy was in that first world country. Why? Short Answer? Insurance!
Why Insurance? Not as short, possible answer? This a rough and very simplistic interpretation of a Map of our Society/Economy (the terms are becoming indistinguishable), that I have in my head…one slice of it anyway
Our Society/Economy is a Great Big Insurance Company (started out as a ‘Friendly Society/Co-op). All the different buildings and shops (including Banks), are simply different departments, specialty outlets and subsidiaries of that giant insurance company. Why? Because if it can’t be underwritten it doesn’t or isn’t allowed to exist. So who owns what really? Hmmm!
Now I’m not saying that I have evidence to back this, it’s just an extrapolated deduction based on what I see and what I know of how these things may work…
I reckon that those third world micro-loans are underwritten in an entirely different way to what a personal loan for a car would be over here. Consider the risk assessment? The Mico-Loans Country (call it ‘ML’), has already been written-off as an unrecoverable debt or something of that ilk. There’s little or no income, people are not insured and there is no measured economic consequence from their life or their death (in our illustrious economic terms, they are worthless)…so any investment in that country has huge incentives (very low costs) and almost zero risk (on paper). It’s like it can’t get much worse, but has everything to gain; so if you’re crazy enough to put money into it, we’ll turn a blind eye until it registers on our International Trade ‘Cash Register’. What happens to your money in the meantime is left to an almost extreme version of ‘Laissez-Faire’. In other words, little or no compliance/regulation/monitoring…enter ‘human nature’ and ‘good will’ in it’s essential and arguably ‘truly’ cooperative form.
It’s a different story in a developed country…almost the complete opposite in fact. A small business is a relatively costly, very high risk investment and is underwritten as such. ‘Good will’ itself measured, priced, bought, sold and of course underwritten…
I’ll pull-over here and open the floor for other views, and I happily stand to be corrected…
Cheers
Stephen G
At this stage, I think I’ll pull over too; I can’t possibly add anything to that comprehensive and authoritative analysis!
Well, as usual Cobba, I appreciate your kind support…though I am flattered, I wouldn’t call it a comprehensive and authoritative analysis…more of a conversational and speculative observation?
Anyway, my intention is to invite further conversation around some of the glaring anomalies underlying business practice (as we know it), not only here, but globally…and this topic highlights a major symptom.
And I know I keep saying it, but with all the ‘energy’ that’s going into ‘eco-friendliness’, ‘carbon-offsetting-ness’ and attempts to address ‘climate change’, we seem to insist on clinging to our industrial approaches to addressing symptoms (sure this might buy us a bit of time, but at what cost?)….how can we hope to establish ‘Sustainable’ anything in an unsustainable context?
That is to say, and in my opinion, unless we actually change fundamental economic/industrial tenets like “constant & never-ending improvement’ (which in practice has come to mean, ‘constant & never-ending growth’), and actually ditch the ‘Accrual Accounting System’ and replace it with the now well discussed ‘Natural Accounting System’, I reckon we are just having ourselves on.
I find this topic particularly fertile ground for tabling this aspect of the conversation, because it is (again in my opinion), one of the main ’symptoms’, preventing us from collectively and meaningfully addressing the underlying causes.
Whilst our commercial sector has all of it’s attention on ’short-term survival’, how can we possibly hope to ‘adapt’ to changing circumstances, let alone begin to actually address malfunctions in fundamental principles underpinning business/commercial practice?
If small business is such a great and necessary part of our society, then why is it that when someone has a go at starting one, there is great moral support from other small businesses, but no incentive for them to actually help? There seems to me to be this ’schizophrenic’ crack where, on the one hand, I deserve moral support for having a go and trying to contribute to the country, but then, if I actually do it, then I suddenly become competition and ‘market-forces’ align toward my destruction (or someone else’s). Who creates ‘market forces’ for heaven’s sake?
Why are so many people in the same position as Lee & Sue? For the sake of conversation, what if everyone implemented the fine suggestions above, what would be the outcome? Would it fix the situation/symptom, or would it simply accelerate it? Would it contribute to addressing the cause, or would it simply push it deeper into our unconscious?
Anyway…I seem to be on a bit of a roll here…so I’ll stop here…again
Cheers
Stephen G
There is an old warning not to work so hard IN your business that you don’t have time to work ON your business. Never has that been as important as it is now. So few businesses like theirs have made the time to learn about all the Local Search Directories and communities that can send them business.
Local Search Directories are like online yellow pages that offer totally FREE far more information than a business could put in a full page display ad. NOW is the time for businesses to take action because:
1) Their existing customer base may have less money to spend
2) It is so easy for them to find alternative businesses now
3) If they look for you online and don’t find you they’re likely to go elsewhere.
Why would your EXISTING customers be looking for you? To get your phone number, find out what hours you’re open, what forms of payment you accept, whether you have a Web site, to see what you carry – maybe even to read reviews others have posted.
And that is just the FIRST step. There is much more to do. I’ve linked to a post I did on a shortcut to getting your business listing in 76+ local search directories. I’m sharing it because it takes days to do that manually. I hope anyone interested in growing their business or blog will come read what I share.
Be sure to leave a dofollow comment and anchor text. If you don’t know what those are you can find out there. Both benefit your blog or business. I also share quality content that crosses my path at Twitter, StumbleUpon, FriendFeed, Facebook and Delicious so cross my path often and I’ll send you more visitors.
Dear IS@GM, it’s great to reconnect with you. You always write such impressive and useful comments.
There’s much in what you’ve said that will benefit many of our readers. I’ve seen you in action over the months and it sure looks like you know what you’re doing.
Megan, you may wish to check out IS@GM’s recommendations with a view to supercharging myBRC’s content. Thanks so much for dropping by.
The other good thing your story illustrates is that it is possible to make a difference, even if you are a small or micro business. We often think that we don’t have much power, but that’s always worth testing! We don’t always have to be at the mercy of government or bigger market players, especially if we can be creative in our approach.
Too right, Joanna. Damn fine point. Thank you for making it!
I thought about this blog post subject yesterday during a conversation with a fellow business owner. We live in a small resort village. She owns a store with the highest volume of foot traffic outside of the local grocery store.
She sells office and business supplies plus the types of business services you would expect – copies, shipping, faxing, etc. And because we are 15 miles from the next bigger city she thrives by being able to provide the convenience of location and time savings. And she provides outstanding customer service. Her customers want her to solve their problems.
We talked about how lucky our village is in spite of our national economy. We seem to be a bit insulated up here. The tourism has been good. Our local wineries, boutiques, antique shops, galleries and gift stores have always served as magnets for shoppers wanting unique items not readily available elsewhere.
Subtle changes have visited our agricultural county over the past decade or so. It used to be families would come and stay for a solid three months. Now, both parents work and they spend a week here and there, perhaps a weekend. Most of the people who owned second homes or cottages have retired and live here all year. That has affected their casual ‘on vacation’ shopping mindset. They are applying the same cost-savings practicality they used prior to living here full time. Their permanent residence has also removed one more vacation rental property from the roster which is affecting vacationers being able to find lodging.
So rather than an abundance of the ‘idle wealthy’, we are transitioning to a population base of practical-minded residents who no longer seem to be buying those high-end gallery and boutique items.
The demographic of those spending freely tend to be a bit older, and while internet users, they are not rabid fans of shopping online. So our conversation led to the topic of consumables. Because pretty soon the age group above our’s will soon be gone. And the age group coming up does not shop for hobby. They shop online. They spend their days on the beach, skiing, boating, golfing, and playing tennis.
Luckily, for her business, she has the perception to see this shift coming and is beginning to change out her inventory to more consumables rather than the trinkets sitting on shelves looking nice and collecting dust.
We also discussed that as this population ages there is less of a desire to collect and accumulate with more of an emphasis on downsizing. Somewhere along the way people are losing the desire to own more “stuff”.
So it was with a sense of foreboding that we said nice things about our fellow merchants and tried not to think of how the fabric of small town shopping is going to change, and not all will be able to survive.
Differentiation will definitely matter. However I think the secret to their survival will be learning about this new type of customer and developing memorable relationships with them. Because regardless of what they value or their generational attitudes, buying decisions are about core emotional needs a purchase meets and fills. Knowing that, and selling to that emotion will be the key to their survival – both online and walking in off the sidewalk.
Continued success,
Cheryl C. Cigan
http://www.known.com
Wow, Cheryl. What a fascinating insight…thank you!
Dear Cheryl, I’m blown away by the time and care you’ve lavished upon your ‘comment’. It’s really a (very good) post in its own right!
Thak you so much for taking the time to visit once again. I commend your site and your excellent new book to our readers.
Megan and Paul:
Thank you for your kind words! I enjoy your blog because of the perspective it provides – and also it is good to step outside our neighborhoods every once in a while to learn how others approach their lives and businesses. Thanks for doing such a great job of that with this blog!
Cheryl
http://www.known.com