Of all the industries that could benefit from local vendors taking part in the market, the service industry is probably the most substantial. Service business owners not only contribute positively to the market but are also lifesavers who make livelihoods of people around them much easier on a day to day basis. The service sector includes everyone from people who paint your homes, renovate your homes, walk your dog, coach you through gym and even those who cook and clean in your homes. Basically, anyone and everyone who serves to make your life essentials easier is a service person.
While it might seem like a daunting task, accommodating a service business while competing with big market players- it must be remembered that customers often prefer local vendors and there has been a massive shift towards smaller businesses in the recent times. A lot of this trend might be attributed to the Covid 19 pandemic, as consumers around the world had to adapt to local marketplaces where businesses based in their immediate vicinites could serve them better. A new pattern of customer behaviour was established where home businesses were trusted more than they were before.
And this trend applies even more to the service industry. More often than not, consumers are likelier to take referrals about service professionals from people around them. When deciding on whom to do their home repairs, renovation or their next hair-do, people tend to listen more to experiences of people they know rather than random reviewers on the internet. This means there has always existed a niche gap for local vendors in the service industry no matter how many big players diluted the market.
A few things to remember about the service industry:
You are the product
Unlike other industries where you could source raw materials from underrated sources and market a unique product, the service industry is all about marketing your skills and yourself. Service professionals are usually trained in a specific service sector or have a particular skillset. Think about it, while you will need some investment as a hair stylist in the form of scissors and other accessories- the quality of the service almost entirely depends on the skillset of the professional.
And consumers usually recognise this dynamic. This means as a service professional or as the owner of a service business, you will need to market the people who will be providing the service. This includes showing off your or your employees’ credentials, years of experience and the equipment they often use.
Over delivering will usually get you far
The great thing about the service industry is how easy it is to out perform your competitors. One way to do this is to leave a lasting impression on first time consumers who will either come back for a second serving or refer you to friends and family around them. Say if you’re providing a 50 dollar service and end up providing something that your competitors would charge 75 dollars for, you’ll definitely impress.
This ends up in good referrals from those consumers and thus you achieve word of mouth marketing (which is still surprisingly effective).
Growth is all about patience
While all business requires some amount of patience, the service industry is all about taking some time to understand your customers and the market you’re catering to. This also means that the amount of time it takes for your business to take off is usually longer as compared to other industries.
However, once your business gets out of it’s growing pains- growth almost comes automatically. You will notice that hairdressers and interior decorators usually keep getting more and more clients as time goes on. Essential, the entire process is like a rock rolling down a steep hill.
It’s important to decide if you want to start small or go big
While some businesses could only start small (like a home bakery or babysitting), other service businesses require you to make a decision. Starting a hair dresser, a renovation or a decor business requires you to make a decision on if you want to start from small or go big big immediately. Starting small will allow you to start with almost no capital, but your growing pains will also be much more magnified.
A larger initial investment will allow you to cut out the growing pain to a substantial degree, however securing funds becomes instrumental. In this case, you will either need to invest a larger amount of personal wealth or come up with a more comprehensive business pitch that you could present to potential investors.
Flexibility is important
No matter if you’re starting your business as a side gig to your job or as a primary income source, the success of your service depends on how flexible your routine is and how well you can accommodate your clients. Failure to meet deadlines will not only take away customers, but also create a negative impression about your business that is pretty hard to get over. Remember, a good impression is half of a succesful business plan.
So, is it worth it?
If you can spare some time and want to hone your hobbies, skills or just want to own something that you can call your own- ABSOLUTELY. Due to the low investment style of the service industry, it’s very easy for you to put your head down and make a dent in the industry. And more importantly, if your plan doesn’t work out and you have to pull out- you can almost entirely recoup your investment.
Running a small service business is all about setting realistic goals and thus it’s important not to give up quick. Set a monthly target that you will keep working to reach and you should be all good to go.
If you’re confused on how to get started or want further clarification on if starting a small business is worth it for you, check over here.