Many years ago in the auto salvage industry, there were the guys
who handled import cars and the other guys who handled domestic
This is not a joke. If you handled import cars as an auto recycler
in the mid-eighties, you were considered “different”
and few in the industry wanted to talk to you. By the nineties,
however, that notion disappeared, and it’s obviously not
the case today.
As the times changed, profit margins declined in domestic parts.
More recyclers came into the business. Margins dropped further.
(Today, margins are continuing to drop for all products.)
That information sets the stage for a hypothetical story, but
one that is close to true.
“My neighbor sees that I’m in the auto wrecking business.
He owns a pizza shop. He sees that I’m driving a brand new
Mercedes. He’s driving a Chevy. First thing I know, he’s
driving a new BMW.
“He knows I’m driving a brand new Mercedes, so he
decides to open up a recycling yard. I see that he’s driving
a brand new BMW; so I decide to open a pizza shop.
“Before you know it, we’re both broke.
“We both stepped out of what we knew first, out of what
we did well and drifted away from our core product. And, we drifted
from our core business. (See last month’s article.) The
import wreckers started doing domestics, and the domestic wreckers
starting doing imports. (Today, there is very little distinction,
and most are made in the U.S. anyway.)”
The moral of the story is not to let your competition drive
your future. Not all your competitors are in the same business
Always try to differentiate yourself with a different product,
service, prices, quality, etc. And remember, perception is reality.
You only have to convince the customer you are different. We all
know a used alternator is probably a used alternator, regardless
of where you get it. But if yours carries a lifetime warranty…now
you are on to something.
If you really want to compete, stay with what you know and do
best. Let your competitor change if he can’t stand it. But
you should stay focused on what you are doing and get better at
it. He’ll never be able to touch you, let alone keep up
with you. The grass is often greenest on the inside of the fence.