Kinky Boots: Finding Your Supply Niche

I saw a wonderful little British flick this past weekend called Kinky Boots (OK, some more established film critics disagree with me on the wonderful part). It's not a complex movie, but in my view, it's an excellent metaphor for how suppliers that are having a difficult time competing in global markets can thrive by finding their niche. The gist of it is that an old-school English shoe maker -- think the British equivalent of the venerable US shoemaker Alden which has made the same style shoes for nearly a century, and of which I own more pairs that I care to admit -- is having trouble competing against lower-priced (and lower quality) imports. But not one to give up, the fourth generation owner -- who is not exactly an expert in all things shoes -- decides to take a chance by targeting a highly niche market. How niche? Try John Lobb-like quality specials for transvesites who need extra support because they're always breaking their heels.

Most people probably would see the movie as the latest in a light-hearted string of British comedies, but my wife and I could not stop talking about the lessons in it for manufacturers and business owners who pursue what others might think of as outlandish, but ultimately profit extensively from their investment. This modern allegory -- and I do mean modern, probably too modern for some -- holds true in so many ways. Even within our own families and businesses, we can think of so many similar situations where outsiders thought we were nuts for pursuing an opportunity. For instance, what right-minded person would have pursued a business blog for Spend Management back in 2004 when no one knew what a blog was (and he could make far more money through other writing and consulting activities)? It was a bit crazy for the time, as was a 100% contingency business model based on implemented savings in the direct materials sourcing and logistics arena which my wife and a business partner launched around the same time. Or what about our infamous "Cousin Bob" who purchased a large commercial property across the street from a federal prison as part of a real estate investment portfolio. His bet was that the facility would close (which it did, after twenty years). But he earned a whopping return on his investment.

If we look at allocating personal time and capital in the same way as allocating spend, there are some decisions that simply could never make sense to an outsider, and a right-minded person would call crazy. But sometimes you need to go with your gut and set out to build your own version of Kinky Boots. As the US automotive supply chain rebuilds itself following the current shake-out with GM and Delphi, perhaps the most successful suppliers will be those who follow the road less traveled.

Jason Busch

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