Let me explain. I used to have just 1 main revenue source to my business and that always was a concern to me because if that dried up for some reason we would have to close the doors, so I decided we needed another strong revenue source ASAP. In this business, I sell previously loved maternity clothing and the model is like a resale / consignment shop. Naturally, we just had our in store revenue source as that is how all of the resale stores operate. But, for me, I didn’t want to be like everyone else and I wanted to stay ahead of the curve. That’s when I opened our online store where we would take items in the store and post them online to sell. Once this was up and running it started to account for 30% of sales just 6 months in. Recently, however, our online sales tanked because our in store sales have been growing rapidly. Now, for most businesses this would be mutually exclusive but seeing as we are a resale shop, every item is unique and if we sell an item in store it is taken off our online store and vice versa. To me, I am not worried about this at all because our overall sales are growing and that growth is cannibalizing our online store, which is fine by me! If any competitor is going to take business away from me, why not have that be me. Where there would be an issue is if a competitor moved in town and sales were drying up because of that, then we would have a problem, but when I am kicking my own butt, I am all smiles.
When I look at my business, I am always thinking of ways to “put myself out of business” to stay ahead of the competition. This forces me to think of new ways we can increase our top line and cut what fat we can to maintain a healthy profit. Now, cannibalizing your business is nothing new, most retail stores that have an online channel, i.e. Target, Walmart, and the 5,000 others, have been doing this for years. The ones that have sat idle that are not in a strong niche category are the ones that fall behind and become history. Comments are closed.
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Who is this guy?Hi! I am Dan Canfield, a born marketer that thrives on pushing the boundaries in my industries. I am currently a business owner, consultant, and employee, so I have a diverse perspective in the business world. This site is an outlet for me to share what I have learned and give you a piece of my mind. |