Competitive midset
Things such as soaps, biscuits, salts, shampoo etc. which are used on a daily basis by us are difficult to cash on as a business. There is fierce competition in the market for such things. A lot of small business owners try to sell the same product with different stories. We buy from the brand whose story resonate with us. This makes the market quite fragmented and competitive.
This rock or that rock
But my mind ponders over a question as to who finds it more difficult to compete in these markets. The big brands which have huge capital but also stakeholder pressure to perform and show consistent growth. Or the small business owners who have limited resources and distribution reach.
One of the tricks that I often see that is used by bigger brands to that once a small brand picks up the pace in the market, a bigger shark just puts down the money to but the stake and kill the small business or assimilate the products into their categories. It may be tempting for small businesses to leave such huge amount of money to leave.
Is it worth your dreams?
Why do small business accepts the propositions from the big brands? I feel that opening the business in that commodity segment was never their dream. It was only for the money. They only try to fill the small gap that they saw in the market. It was never about building a sustainable businesses. It is intriguing to see that the founders could observe such gaps and execute upon that. However, staying in the market takes a lot more than what was originally thought.