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Ever heard the expression, “Think Outside the Box?” Of course you have – who hasn’t? Roughly translated, it means to think of the things that people don’t normally think of. In business, it means to find and utilize the ideas that your competition is missing.
What is my point, you may wonder, and why am I bringing up this topic? A few days ago, I had a conversation with another bookkeeper that irritated the “heck” out of me. The bookkeeper worked for a property management company that dealt with billing for a condo association. I asked the bookkeeper if they had an email option where they could email their bills instead of snail-mailing them. In the most snotty tone possible, the bookkeeper said, “We don’t do that. We have 1,200 condos that we bill for. It would be too much work to email everyone a bill.”
“Do you have QuickBooks?” I asked her, intent on telling her how to setup the email option so that she wouldn’t have to do any extra work ever again. (At the same time, I was thinking – well, how long does it take you to stuff all those bills into envelopes? And how much does it cost you to buy stamps for all those envelopes? But of course, I didn’t say that.)
“No, we don’t,” she snapped, clearly peeved that I had dared to ask. “We have (insert obscure bookkeeping program here) which is the standard bookkeeping program for property management companies. That program does not have an email option.” And with that, our conversation was over.
When I hung up the phone, all I could think about was how irritating the whole situation was. I could see immediately that the property management company – and the bookkeeper – were “in a box.” They were using the “standard” bookkeeping program for their industry instead of looking for something new and better. On top of that, they are not the only property/association management company I deal with. I’ve dealt with many others, and I happen to know for a fact that none of them offer to email bills. They are all doing the same thing and using the same programs, and none of them have set themselves above or beyond their competition; they’re all in the same box.
Can you see the problem with being “in the box”?
The Problem with Being “In The Box”
As I’ve stated in my profile, I not only do bookkeeping, but I also do market financial feasibility reports. I’ve done research for hundreds of malls, museums, arenas, concerts, and food and beverage facilities all across this country. I’ve done research for huge corporations like Paramount, Starbucks, the Academy Awards, and Kelloggs. I’ve had access to confidential information which will forever remain locked inside my head. And do you know what those big corporations always ask? They want to know what concepts are successfully working in other cities similar to theirs all across the country. And this is the trend I’ve seen when I begin researching a city:
In every city and town across the country, a “standard” business-type (or “box”) is created in that city. In other words, every business in that area does the same thing. They’re location has become the box. On top of that, they’re all offering the same services and products, and very few businesses set themselves apart from the others – or “get out of the box. The ones that do “get out of the box” and set themselves apart go on to become successful franchises. The ones that don’t, often end up making just enough money to get by, and others go under during difficult times.
An Example of How Businesses put Their Companies “In The Box”
You’re probably thinking I don’t know what I’m talking about – or I’m just not making any sense. So, here’s an example. Consider the national chain, Chuck E Cheese. This “Family Entertainment Attraction with a Restaurant” has three basic products they sell: arcade game entertainment, kid-approved food, and a party environment. The last time I pulled their SEC filing, I did an analysis of how much money each product brought in. Here’s how it broke down:
- On average, each arcade game brought in approximately $11 per month. (I know – ridiculously low, right?)
- The majority of their kid-approved food was pizza, soda, and a very basic salad bar. The food and beverage element brings in the largest portion of their profits – as much as 80% to 90% in some restaurants.
- The parties average $100 to $200 per group, which includes food and game play. Most of their parties are on the weekends.
This is the “basic box package.”
Now consider their competition in your area – the other “Family Entertainment Attractions with Restaurants,” whether golf courses, lazer tag, skating rinks, bowling alleys, etc. The ones in my area all serve the same food – pizza, soda, hot dogs, and nachos – in other words, unhealthy food and soda. They all have arcade games. They all offer birthday parties with food and limited access to their other elements. It is the standard “box” and it becomes the standard because the business owners look around their towns and cities and see what they believe is working for other businesses and then implement it into their own companies. They are unwittingly strengthening the box and thus making it harder to for all of the businesses to thrive. (Think about this – the last time you went to an arcade, how busy was it really?)
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Other Examples Of Being Inside the Box
- Have you ever gone to an author’s book signing? Have you ever noticed what they give out when they sign a book? An author, no matter how big or small, will give out one of three things with their books: a bookmark, a post card, or an empty book cover.
- Have you ever been to a Smoothie Shop? What do they serve? Smoothies with boosts, and maybe a very, very small menu of “healthy foods.” On top of that, they all charge approximately $5 for their smoothies.
- Have you ever been to a health food grocer? They almost all sell organic food products and vitamins.
- Hamburgers – they’re almost always sold with fries.
The only way any of these businesses end up thriving is if they manage to set themselves apart somehow, whether through name recognition and brand preference, or finding a location farther from their competition.
How to Think Outside the Box in a Manner Similar to the Big Boys
If you want to “get out of the box” and become as successful as the larger corporations, you have to do a certain amount of research. You have to open your eyes and ear, and you have to pay attention. Here’s what you need to look for and to ask if you truly want to “get out of the box”:
- Define your box: What is your local competition doing that you also are doing? Where are you all the same?
- Next – look outside the box. What are similar companies doing in other towns and cities that mirror your own population-wise? What elements are they selling that you can implement into your own business?
- Listen to Your Customers. What elements have your customers asked for that you’ve given the old “it’s the industry standard” reply? What services or products could you sell that would make their lives easier.
- Recognize Any New Elements. What can you offer to your customers that your competition is not offering?
- Analyze the New Element. What is the true cost of that element? If sold alone, will it create a profit? If it will not create a profit, will it draw in customers?
- Implement the Element if possible. The more elements you can successfully add to and advertise for your business, the faster you will outdistance your competition and the longer you will survive.
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Source Article from http://onehourbookkeeper.com/2013/07/30/get-out-of-the-box/
Get Out of the Box
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Originally posted 2013-07-30 09:19:34. Republished by Blog Post Promoter