What is Your 1% Advantage?

What is Your 1% Advantage?

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The One Percent Rule—Are You 1% Better than your Competition?


James Clear— author, entrepreneur, and past Guest Speaker at a Caito Foods’ Seminar—recently wrote a column on JamesClear.com entitled “The 1 Percent Rule: Why a Few People Get Most of the Rewards in Life”. He begins with a bit of history: “Sometime in the late 1800s—nobody is quite sure exactly when—a man named Vilfredo Pareto was fussing about in his garden when he made a small but interesting discovery. Pareto noticed that a tiny number of pea pods in his garden produce the majority of the peas. Now, Pareto was a very mathematical fellow. He worked as an economist and one of his lasting legacies was turning economics into a science rooted in hard numbers and facts. And the peas in his garden had set his mathematical brain in motion. What if this unequal distribution was present in other areas of life as well?”


And Clear continues with another example from nature: “The Amazon rainforest is one of the most diverse ecosystem on Earth. Scientists have catalogued approximately 16,000 different tree species in the Amazon. But researchers have  discovered that there are approximately 227 ‘hyper-dominant’ tree species that make up nearly half of the rain forest. But why?”


Clear explains: “Imagine two plants growing side by side. Each day they will compete for sunlight and soil. If one plant can grow just a little bit faster than the other, then it can stretch taller, catch more sunlight, and soak up more rain. The next day, this additional energy allows the plant to grow even more. This pattern continues until the stronger plant crowds the other out and takes the lion’s share of sunlight, soil, and nutrients. From this advantageous position, the winning plant has a better ability to spread seeds and reproduce, which gives the species an even bigger footprint in the next generation. This process gets repeated again and again until the plants that are slightly better than the competition dominate the entire forest. Scientists refer to this as accumulative advantage. What begins as a small advantage gets bigger over time. One plant only needs a slight edge in the beginning to crowd out the competition and take over the entire forest.”


MERCHANDISING TIP OF THE WEEK.   James Clear proceeds—in his article—to outline how, like that tree in the Amazon, a business uses a slight advantage to grow faster and stronger...and how that slight advantage becomes great over the passage of time.


The 1 Percent Rule: Here is how James Clear takes his “nature” examples and turns them into business applications: “You need to be only slightly better than your competition, but if you are able to maintain a slight edge today and tomorrow and the day after that, then you can repeat the process of winning by just a little bit over and over again. And each win delivers outsized results. We can call this The 1 Percent Rule. The 1 Percent Rule states that over time the majority of the rewards in a given field will accumulate to the people, teams, and organizations (stores) that maintain a 1 percent advantage over the alternatives. You don’t need to be twice as good to get twice the results. You just need to be slightly better.”


Choosing the area in which you want to be 1 percent better: Choosing an area to “beat” your competition is difficult, because that decision can be reversed—in some cases—as easily as changing a price or “heating up” an ad. But beating the competition in other areas can be more profound, more noticeable, and more lasting.


For example, what if you chose to be “fresher” than your competitors?  While this could be treated as merely an advertising “catch-phrase”, what if you decide to prove you are fresher— perhaps by starting in your cut fruit / cut vegetable area?  What if, for example, you only allowed cut melons on display for 24 hours before discarding them?  What if bagged salads were pulled two days before the sell-by date? What if you proved you are fresher by living up to the highest freshness standards?


Or maybe you  choose to be the “safest” place to buy fresh produce. Once again, this could be a nice talking point—or you could choose to prove you adhere to the highest standards of food safety by inviting your customers to tour your back room and prep areas. This food safety emphasis could be exemplified by the uniforms worn by your staff—plastic gloves, clean smocks, even hair nets. And your cleaning and sanitation schedule might be posted for all customers to see— and cleaning done during times when it can be witnessed by those who shop your store. Of course, dusty fixtures, debris on the floor, flickering lights or clanging fans can never be part of being 1% safer than other stores in your area.


Another way to gain that 1% advantage could be establishing your produce department as the most “engaging” place to shop. This means much more than a blanket “How ya doin’” thrown out to everyone who passes within range of an associate. You need to prove your associates are more engaging by training them to speak confidently about the products offered—recommending new items, sampling specialty offerings, understanding and sharing recipe ideas. After all, we are all in the Food Business, and every associate needs to understand basic food preparation facts. So to achieve this 1% advantage, you need to invest in training , and look at prospective associates in a different way. Better to hire a completely inexperienced associate who genuinely loves food and cooking than a seasoned veteran who only eats Big Macs and fries.


The most risky way to attempt to gain that 1% advantage is the be “cheaper” than your competition. While some merchants have successfully managed to be cheaper, reducing prices usually comes at the expense of either profits, reducing quality  standards, or paying fewer associates. Diminished profits must be made up somewhere else in the store, so another department must suffer. Fewer associates would make being freshest, safest, or most engaging nearly impossible. And reducing quality? Benjamin Franklin said it best: “The bitterness of poor quality remains long after the sweetness of low price is forgotten.” So, choose the area you want to create an advantage over competitors wisely. And remember, it takes a sustained 1% advantage to create sizeable long-term victories. Happy Selling!

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