Scratch a niche to find small business success

Sometimes, a niche business starts out offering one product or service, then moves into an entirely different niche. When he started his business in 1990, Tim Mossberg, owner of TLM Industries Inc. in Fort Walton Beach, Florida, distributed screen-printed cups and mugs for convenience stores. Each mug had the logo of the particular convenience store on it. But his clients were telling him that what they needed even more was a supplier they could turn to for durable staff uniforms that would hold up through many washings. Also, many of Mossberg's clients employed plus-size individuals and had a hard time finding appropriate uniforms, so they just told their staffers to wear their own clothing. Mossberg, 42, personally went to store managers in various states--including Alabama, Georgia, North Carolina, South Carolina and Tennessee--to get input firsthand about their employees' uniform needs. A light bulb went off for him--and the mug niche was replaced by the uniform niche.

“You have to listen to your customers very closely and research on your own if what they are asking for is viable when you create a niche company," says Mossberg, whose $2 million business employs 20.

Today, Mossberg services more than 200 convenience-store chains nationwide, manufacturing and distributing all their employee uniforms. He knows this niche business can keep growing, since the convenience-store market has a total of about 2,500 chains. Already, Mossberg is branching out his specialty even further: He has recently started supplying uniforms to supermarkets and fast-food companies.

The beauty of a niche business is the ability to capitalize on your area of expertise and add new customers who will still buy what you are selling," Mossberg says. "I've found a niche that works, and there are many possibilities for further growth. It's a great feeling.

Finding your niche
Brainstorming niche business ideas is easier than you may think, says Ira Davidson, director of the Small Business Development Center at Pace University in New York City. With a women’s clothing store, for example, you can create separate and distinct niche stores that sell one type of women’s attire. Related niche stores from this single concept would include:

• Bridal shop
• Business suits, handbags and accessories
• Casual clothing
• Clothes for girls and teenagers
• Designer clothing store (all items are one designer’s name, such as Gucci)
• Discount clothes—every item under $10
• Evening and formalwear
• Maternity wear
• Petite-size clothing
• Plus-size clothing

Resources
Learn more about your niche from:

• Competitors
• Customers of the product or service
• National Association for the Self-Employed
• National Association of Women Business Owners
• Niche and Get Rich, by Jennifer and Peter Sander (Entrepreneur Press)
• SBA
• Similar companies that have failed
• Trade-association meetings
• Trade magazines

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