Why is it that we are reluctant to focus our business?
The vast majority of the readers of my blog and newsletter are freelancers, professionals, consultants or other knowledge industries and this is particularly relevant to you. However this has just as much application for any business.
The evidence is overwhelming that a business which is narrow in what it does makes the most profit.
Tim Williams of Ignition Group talks about the complexity tax. There are many examples of big companies that we could use however rather than use HP vs Apple (60000 products vs 120) but consider Coke and Pepsi. Coca Cola is a beverage maker only. Pepsi is not only in beverages but also food. Coke is the most successful though. The more complex a business becomes the less profit it makes.
Lets bring it back though to our size businesses. Just for a minute though consider the medical profession. The specialist’s make more than the General practitioners.
It is who we don’t work with, it is what we don’t do that matters most.
By trying to serve as many people as possible, or as many services as possible we become known for nothing. No product or service or company is able to be successful by being the answer for all comers.
Now I know personally it is hard to narrow. Because we can do a lot things we think we should. We feel that if narrow our focus then this will increase the risk. It makes us nervous when we see a potential client / customer going elsewhere.
But the reality is totally different.
By subtraction we will achieve multiplication. (yes excuse the fuzzy maths).
For an excellent example of the power of focus I refer to a great chat I had with Chris Farmand of Small Batch Standard – an accounting firm specialising in craft breweries. Chris talks about whilst he endured sleepless nights it has been the best decision he has ever made.
So my challenge to you is “how could you narrow the focus of your business?”