What is Your Business “X Factor”

Running a business can be an insane gamble, given the odds of failure. But it doesn't have to be that way--not if you discover your company's X factor. That's what allowed ventures such as Starbucks, Apple, and McDonalds to dominate their industries. By finding their X factor--that is, an exponential advantage that put them at least seven times ahead of competitors --they left their rivals gasping for breath and unable to catch up.

Let’s take for example Schultz, the founder of Starbucks. His company’s X factor was charging prices several times higher than his competitors. That gave him the capital to hit big and quickly open thousands of cafes across the country and multiply his extreme markups many times over.

So how do you figure out your X-Factor?

The best place to start is to look for common industry bottlenecks. Once solved, they could put your business in the driver’s seat. Usually, they could be a massive cost factor or an enormous time factor. The real challenge is that you’re often as blind as everyone else to the real problems that have been accepted as industry norms.

Next, begin looking for solutions that will give you an exponential competitive advantage (7-10x) for your industry. You may look outside of your industry. Use the power of analogous thinking to find solutions to critical industry problems that have already been solved by other sectors.

Sometimes merely thinking about your industry from a different perspective is enough to help you find your X-Factor.

Three examples of companies manage to solve industry bottleneckes and find their X factor.

McDonald brothers solved the long-standing restaurant industry bottleneck. They managed to reduce the drive-in dining experience from an order being ready in 30 minutes down to a nearly-unbelievable 30 seconds. This is how the “fast food” was born and formed the backbone of chain restaurants for decades.

In the furniture business, the industry bottleneck has always been the storing and shipping a whole lot of air. Ikea’s solution was simple: “Flat-Packed”. By making furniture that was flat-packed, they’re able to save a lot in storage and delivery costs. With the flat-packed approach, IKEA’s profitability is a whopping 13% compared to the 2% industry average.

Barrett Ersek, the founder of lawn care company Happy Lawn faced a very challenging situation.

It typically takes five weeks in his industry to land a customer at an average cost of $350. Since his service costs $50/month, it would take him about seven months to break even on the sales and marketing costs.

So Barrett worked on reducing the time and cost of getting a customer. He found a way to reduce the time from five weeks to five minutes, which doubled his customers from servicing 6,000 to 12,000 lawns in about five weeks.

Barrett’s X-factor approach to acquire customers was so attractive, that he was able to sell his company for a huge profit.

So, are you ready to find your X-factor? Read this 7-step blueprint for making 10x more money with your business.

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