Big ticket or big volume?

Sep 3, 2015 | | 1 comment

My experience as an entrepreneur has thought me that there are two options to make it big, which I refer to big ticket and big volume.

Big ticket means high ticket business. Offering premium products with significant margins that allow you to be relatively successful just by selling a few of them. If you build and sell high end houses, or run a BMW/Mercedes dealership, you might be a high ticket business.

Big volume means high volume business. Selling low profits, affordable items, to the masses, and achieve scale by the volume of sales. Internationally, MacDonalds or Walmart are examples of such businesses. In Africa, if you are wholesaling rice or other commodities, you might be a big volume business person.

The huge mistake that many entrepreneurs make, including myself at a point of my entrepreneurial journey, is to go for the big volume, low margin business, but not having the market size necessary to make it to the next level. This is especially a concern in Africa where demand is inelastic and lowering your prices will not automatically translate into higher sales. I used to criticize sellers who were maintaining prices at a high level compared to their costs and local purchasing power, only to understand later than even if they lowered their prices, they would not sell that much more.

So are you, or will you go for the big ticket or the big volume?

Posted in: Business | Tags: , ,

One Response

  1. Hi, We are supplier and exporter of Stainless Steel Architectural Hardware Fittings, stainless Steel Bathroom Accessories and Stainless Steel Glass Fitting Hardware.

    can you suggest me, how can we access African market place?

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