Say hello to another business term that is not nearly as well known in the mainstream - “Monopoly Control”. In this article, I’ve invited Louise Motuzas - Co-founder of Thrive Business Consulting, and an accredited exit planner, to dive into the concept and what it means for your business.
So jump straight into what monopoly control refers to. The term encapsulates “how you can stand apart from your competition. It means that you have something that is very hard for somebody else to replicate. It would be hard for a different business to go to one of your customers and match your offering. So it’s important to have something that stands out, either because you developed a product that you've patented and nobody else has that product, or you have packaged a product in such a way that it's very difficult for a competitor to do again.” Louise explains
A market system that possesses the traits of a true monopoly is referred to as a monopolistic market. When one supplier offers a specific commodity or service to lots of customers, there is a monopoly. In a monopolistic market, the dominating corporation, or monopoly, has complete control over the market and hence determines the supply and price of that item or service.
The effects of monopoly control
In this masterclass series over the last 3 months, my focus has been to help business owners like yourself come to terms with the reality that we all will need to make an exit at some point. When we intentionally plan to exit on our terms, we will build the best possible value for our businesses.
And if you have a business that is essentially only running on price, and not on an alternative unique value proposition, it's going to be much harder for you to exit from your business. If you want to grow value to your business, you have to offer unique products or services; the more unique and the more entrenched you can get with a niche customer base, the better it is for you.
Louise shared with me a story from when she worked at a bricks and mortar business: “In the computer industry, we had a very loyal customer; a customer that had to put projects out for tender as part of their process. And one time they put something out to tender and a company that wasn't even in London, Ontario, (they were actually in the GTA - Greater Toronto Area) came in and they were very, very slick. They had a good marketing department. They were very smooth with their presentation. On the other hand, what we did is we just gave the customer what they needed, but we didn't do it as slickly. This meant that we did lose an extremely large customer. Not the customer as a whole, just that particular contract, but we're talking hundreds of 1000s of dollars.”
How monopoly control applies in the consulting industry to make you unique
“I'm a business consultant and there are millions out there. Why would I be the best choice? Well, there's many reasons! One thing is that I've actually owned a company, I’ve had employees, I've had inventory, I know what’s kept me awake at night. And secondly, I'm a team instead of being on my own. I've also recently become a Certified Value Builder and a Certified Exit Planning Advisor, so now I have an up monopoly. There is nobody within 90 miles of me that has what I have. This is something I did on purpose, because I wanted to stand out in an otherwise crowded market.” says Louise
If you enjoy the audio medium, you’ll find a lot more in the podcast episode here. Have a listen!
If you are looking to make a cash rich exit from your business in the next 5-10 years, please continue to make time for this series. We have 10 columns on the subject, over 3 months, which will set you up with the basics of the 8 drivers of value in business. This Value Builder Masterclass series is sponsored by “Elevated Conversations” with me, Colleen O'Connell Campbell, a roundtable mastermind for co-founders and business owners who want a cash rich exit in the next five to 10 years.
An invitation to an Ottawa community.
If you’re in Ottawa, you may be interested to hear that I'm reintroducing “Elevated Conversations” which originated in 2018 where I brought together smart investors and business owners to talk about interesting topics in technology and finance that were disrupting our world. With COVID and the end of dinner parties, we moved to virtual roundtables and now I’m bringing back masterminds in person.
The event is on October 26, 2022, and is by invitation only.
Let me know via LinkedIn or email if you’re interested, and I’ll send you more information.