Business disruption and evolution: How can we make the right decisions?

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My late father's drug store. This image would have been taken when I was 10 or 11 years old -- and his business was surviving some really high-powered competition
My late father's drug store. This image would have been taken when I was 10 or 11 years old -- and his business was surviving some really high-powered competition
My late father’s drug store. This image would have been taken when I was 10 or 11 years old — and his business was surviving some really high-powered competition

When I was young, I remember well my father reacting angrily to the arrival of a discount drug store in Vancouver, where we grew up. The store advertised effectively especially on radio, and cash prescription sales dried up. The competing store survived, thrived and expanded, and today London Drugs continues to be one of the most successful Canadian retailers.

Yet my dad wasn’t a complete fool, who would allow his business to be blown away by the competition. He discovered a rather unique (and to me, highly embarrassing) niche: Selling condoms.

In the late 1960s, contraception and sexual disease prevention wasn’t a topic you would speak about in open, polite society, so he came up with his own radio ads, where he publicized: “Male clerks in attendance after 6 p.m.”

It seems the customers got the message. Guys came in from all over the city to purchase their condoms, including bulk orders from ships’ chandlers. Because my father’s sales volume within this speciality was so high, he received huge quantity purchase discounts.

As well, folks from the British Columbia interior requested mail order supplies. These were easy to serve from the store’s sub post office. However, there was one amusing incident where a guy showed up after six p.m. one day because he needed a “mail clerk” — he had a parcel he wanted to send.

I, of course, endured ribbing from my middle-school classmates about this rather unique and very public business. But the store survived, based partly on the condom revenue, and also because it’s location in a poorer neighbourhood generated a steady volume of government-paid social assistance prescriptions, where the cash cost of the drugs didn’t matter to the consumers.

ships chandelry
A restored ship chandlery circa 1900 at the Maritime Museum of the Atlantic in Halifax, Nova Scotia. (Wikipedia)

However, I suppose the experience/environment put me off of pharmacy as a career — and that sub-post office, from where I would send requests to obscure countries for their stamps, introduced me to bright coloured pieces of paper from otherwise unimaginable African countries, like Rwanda and Burundi. Little did I know that these perceptions would eventually lead me visit and live in these places as a young adult, setting my life’s direction.

These days, in our businesses and practices, we see similar competitive challenges. In the architectural, engineering and construction community, large conglomerates are gobbling up middle-sized professional firms; as middle-tier opportunities disappear, through project bundling, expensive-to-bid public/private partnerships and the like. In the residential sector, a combination of the cash underground economy and in some markets, sophisticated and well-organized marketing machines, make it harder to earn a dollar.

We have it easier than some other industries.  Taxis are really suffering under Uber’s onslaught and the conventional print and broadcasting media (heck, my business) have to contend with massively successful Internet and online advertising with the likes of Facebook and Google.

How do we survive these forces?:

  1. First, we must recognize and appreciate their power, and that disruptive market innovations and technologies will tear at our established practices. We might want to wish for a return to the good-old-days, or perhaps to see regulatory enforcement to protect the status-quo, but these models generally break-down under free market pressures.
  2. Second, generally the best way to survive disruption is to do our own bit of disruption, ideally by discovering and implementing a solid niche/focus strategy. Sometimes it is best to slim down and be really good at a few things than being okay at  many.
  3. Finally, it never hurts to align with rather than fight the trend-creating leaders. We’ll be sailing with, rather than against, the wind.

My eldest brother inherited my late father’s pharmacy and continued the business until his own retirement, when he sold the still-independent business for a healthy sum to a conglomerate which maintained its branches’ independent brands. After my adventures overseas, I ended up in Ottawa, ultimately establishing 25 years ago the speciality construction publishing business that continues today.

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