Not long ago, NPR's Morning Edition had an excellent story on the "comeback kid" of small business, General Pencil. Founded in 1864, this New Jersey-based, family-operated pencil manufacturer still uses machinery from the beginning of the 20th century to create high-end pencils.
No. 2 Pencils are a highly disposable commodity and can be manufactured cheaper in overseas markets like China (surprise, surprise). By the mid-1990's, General Pencil's customer base began to decline and the end of an era was in sight. But rather than dry up and wither away, General took important steps to resuscitate itself:
Stop, Look and Listen.
David McCullough recently commented on the research and writing of his Pulitzer-Prize winning books, "It's the thinking that takes most of the time, as it should." In the mid-1990's, General Pencil took a deep breath and began to think. What were the trends in the industry... in the world? How has society changed... and do we fit in? General Pencil put an ear to the ground and began listening for the arrival of impending change. They detected subtle shifts away from pencils as writing instruments, and began to search for ways that they could stay in business without sacrificing quality.
Exhale - Then Redefine Your Market.
With technology overwhelming the market for basic writing instruments, General Pencil had to make some difficult decisions and then had to redefine its customer. The company looked beyond a customer's need and focused in on her motivation - what kind of customer might be looking for a high quality pencil? The natural answer was artists and art students. General dropped their biggest line (No. 2 pencils) and focused on the market that cared about quality. It’s very difficult to give up the comfort zone you’ve always worked within, but drastic times call for drastic measures. Focusing on a niche within a broader business category proved to be exactly the right thing to do, especially with the power of the Internet and the opportunity to connect with artists worldwide.
Become the Gumby of Your Industry.
General Pencil is now so focused on delivering the best to loyal customers, they bend themselves into pretty much any shape the customer wants. Recently, one of their retail store customers asked for a smaller version of the popular artist color pack. Turnaround from idea to finished product? One week. They not only strive for immediate response, they have no less than 30 new products in development at any given time. How flexible are you when it comes to customers’ needs? Do you have the skill and the will to do whatever it takes to satisfy a customer? If you don’t, guaranteed there’s someone else out there who is eager to fill your shoes.
Are you asking yourself the right (and sometimes difficult) questions? Do you even know what questions to ask? Could you redefine your market if you had to... and in the process, re-invent yourself? It may mean a smaller target, but as my partner Roy H. Williams often asks, "Would you rather own 100% of the people 10% of the way, or 10% of the people 100% of the way?" It can mean the difference between obscurity and profit beyond your dreams. Now that’s something worth writing home about.