Is niche positioning considered a sustainable competitive advantage?

QUESTION:

I’m wondering if niche positioning is considered a sustainable competitive advantage by the investment community?

ANSWER:

Larry Chaityn

Larry Chaityn

by Larry Chaityn, President, Keiretsu Forum NY

Great question and way to be thinking!   The short answer is yes.

When determining the type of product/service there are 4 basic strategic options to consider:

1. Enter an existing market

2. Create a totally new market

3. Resegment an existing market as a low cost entrant

4. Resegment an existing market as a niche player

There are specific strategies with each.

Tell me a bit more about your product category, and I’ll try and give specific examples.

Comments & Advice:
  1. Excellent question, I would like to get your opinion on our venture. We are an enterprise software development company with emphasis on clinical laboratory systems. We have a very high end and comprehensive product that covers all possible workflows, and is highly integrated with other systems and hardware vendors. We have one code base but a highly configurable system, we custom tailor each installation to our customer specifications. We have a traditional deployment mode but a transactional pricing model.

    Hope this was enough info. Thanks in advance.

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