In short: when capital is limited, start as a specialist. Become known for one service or product, then consider widening your range. Specialise first, broaden later; the risk is far lower.
The difference
- Specialist: one category of service or product. Lower investment, simpler management, staff reach expert level faster, and customers remember what you do.
- One-stop: everything customers might want. More apparent opportunity, but more equipment, staff and stock, and every line has to be good.
Why specialise first
- Your money goes further: the same budget, focused on one service, buys better equipment and better people.
- Word of mouth comes faster: "they are the best at X" gets passed on more easily than "they have everything".
- Standards are easier: with fewer services, processes are easier to write down and teach, so quality is steadier.
When to start broadening
- Your core service is reliably profitable and no longer depends on the owner doing it
- Regular customers start asking "do you also do Y?"
- The new line can use your existing customers, staff or equipment instead of starting from zero
This holds in almost any industry: being first at one thing makes you easier to choose than being tenth at many.
Specialise first. Broaden later.
Adapted from Dave Tan's book How High Should Your Customer Retention Rate Be? (2014, in Chinese), updated for today. About the book
Author: Dr. Dave Tan, DBA — Founder of Vital Design, Doctor of Business Administration (DBA). A business consultant to salons and SMEs since 2003, and author of a book on salon management.
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