Scratch a niche: targeting a narrow customer base with a niche business could be your key to success

Entrepreneur, August, 2005 by Laura Koss-Feder

"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 zoo 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:

1. BRIDAL SHOP

2. BUSINESS SUITS, HANDBAGS AND ACCESSORIES

3. CASUAL CLOTHING

4. CLOTHES FOR GIRLS AND TEENAGERS

5. DESIGNER CLOTHING STORE (ALL ITEMS ARE ONE DESIGNER'S NAME, SUCH AS GUCCI)

8. DISCOUNT CLOTHES -EVERY ITEM UNDER $10

7. EVENING AND FORMALWEAR

8. MATERNITY WEAR

9. PETITE-SIZE CLOTHING

10. PLUS-SIZE CLOTHING

RESOURCES LEARN MORE ABOUT YOUR NICHE FROM:

* Competitors

* Customers of the product Or service

* National Association for the Self-Employed (www.nase.org)

* National Association of Women Business Owners (www.nawbo.org)

* Niche and Get Rich, by Jennifer and Peter Sander (Entrepreneur Press)

* SBA (www.sba.gov)

* Similar companies that have failed

* Trade-association meetings

* Trade magazines

LAURA KOSS-FEDER is a freelance business and features writer in Oceanside, New York, who has written for Business Week, The New York Times and Time.