Can Small Niche Stores Last?

Almost all of us have heard the tale of the elephant who was scared of a small ant. For the benefit of those who may not have heard it, in that story the ant could control the elephant as it could cause pain by getting into the trunk of the elephant. 

However, this does not hold true in most instances in real life. The normal scenario in the world we live in is where the ant gets trampled by the elephant even before it could contemplate entering into the elephant’s trunk.

This phenomenon is clearly visible in the market. You would surely have noticed small scale businesses either being thrown out of business or being devoured by the market giants.

For example, take a look at the next door grocery store which disappeared with the introduction of a famous retail chain into the neighbourhood.

Although rare, there are instances where small scale businesses have actually succeeded in acquiring considerable market share. The best example is the industry of craft beer Hong Kong. Even though this industry faced its own drawbacks (be it because of the laws that were in place or because of the powerfulness of the large players in the market in terms of advertising, benefits of mass productions, etc.) it managed to bounce back with vigour.  

The secret behind the success of this particular industry has been identified as “true differentiation” which means that the products are so different that the consumers can clearly identify based on the flavour, quality, etc.

In the case of fine Grimbergen crafted beer the differentiating factor is the flavour. Due to the differences in the brewing process, the ingredients used, etc., the flavour of beer changes and may better suit the preferences of many people.

Likewise, in agriculture, the latest trend is organic food. At the moment organic food is mainly being harvested in small scale farms but this does not mean that the large agriculture companies will not takeover soon.

In contrast, crotchet, paper quilling and hand crafts, especially in the jewellery sector, remain the domain of the small scale businesses as they essentially have to be done by humans.

Yes, the small enterprises advertise less (if they ever do) by spending a lot of money like the mass producers do and mainly rely on the grapevine. Once a customer purchases a good, if he/she is satisfied with it, he/she is bound to spread the rumour.

This advantage can clearly be seen in the apparel industry. People, especially women, cannot stand to be seen wearing the same outfit as someone else; they want to be unique and uniqueness cannot be achieved through mass production due to the costs.

Therefore, it can be deduced that miniature businesses may thrive by acquiring more market share and more recognition if they are craftier than the mass producers.

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