I’ve been reading about the evolution of the Early Learning Centre (ELC) this week and, in particular, it’s brush with the bad times.
ELC is a chain of educational toy stores that, over the years, has become something of a British institution. You‘re probably familiar with them as there are a number of ELC stores in Australia. I, being both English and a mum of four, am almost intimately acquainted.
As the story goes, the ELC was doing phenomenally well. They were the go-to people for educational toys and were one of the most highly regarded retailers in Britain.
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As often happens when a business is doing a great job, ELC’s success made the educational toy market look very attractive: enter the competition.
ELC’s response to the new players in the market was not unusual. Rather than tackle them head on ELC decided to diversify. Soon the ELC stores carried an enormous range of other products including clothes and nursery furniture.
But the diversification was not a great success. ELC got so absorbed in its new business that it lost sight of its core. At the time a ‘turnaround’ team came in to save the company it hadn’t developed a new toy – the core of its business – for over five years.
It’s an interesting story that plays out in many small and medium sized growing businesses.
When you are a very small business you fly below the radar. You do a great job, but because you are pretty small your business doesn’t look fabulously attractive. Yet.
The time does comes though when people wake up to the success that you are having and, quite literally, they want to have some of it too.
This is when you start feeling the force of tough, and sometimes unethical, competition.
What course of action you take next very much depends on your individual circumstances. But, one thing’s for sure. You don’t want to jettison the very thing that made you successful.
So, if this sounds like the position your business is in right now, take a moment to remind yourself:
- What made your business great?
- What is your business best known for?
- What is the ‘bread and butter’ of your business?
In other words, keep doing what you do, and do it well. Even if you add products to the mix, keep on “developing the games”.
Julia Bickerstaff’s expertise is in helping businesses grow profitably. She runs two businesses: Butterfly Coaching, a small advisory firm with a unique approach to assisting SMEs with profitable growth; and The Business Bakery, which helps kitchen table tycoons build their best businesses. Julia is the author of How to Bake a Business and was previously a partner at Deloitte. She is a chartered accountant and has a degree in economics from The London School of Economics (London University).