Let's say you've had a great business selling to auto companiesWhat do you do now? Wait for the American auto industry to get better, or……

Let's say you've had a great business selling to airplane manufacturers.  What do you do now?  This week is the biggest week in the airplane business.  It's the Paris Air Show, or as many call it "La Bourget" which is the name of the suburban Paris town where the show occurs.  It's the "mother of all conventions" as manufacturers of planes (and lots of military equipment beyond things that fly) try to book orders from international governments, airlines and corporations.  This year, it's doom and gloom as Marketwatch points out in "Is Paris Burning?".  Even the President of Brazil's very successful commuter jet manufacturer Embrear is saying it's too early to call a bottom in aviation sales in his interview "Not There Yet". 

There are many American businesses selling to the aviation industry.  Aviation doesn't cycle as fast as automotive, because the prices are much higher and the product lives much longer.  So it's easier to predict market moves.  We now can predict that the business will be soft for a few additional years with high confidence.  Some will choose to "double down" and try to grow share while the recession is on.  An expensive effort to find a lower cost while volume drops.  Another option would be to cut output, lay people off and wait it out.  But, unfortunately for both these options, when sales resume you can't be sure some new suppliers won't have entered the market with new products or new technology.  Both approaches could well find prices down and competition up – or even worse the market recovers with new aviation products and you're in a pitched battle to supply the industry against new competitors against whom you have no advantage.

A better idea is to move resources.  You don't have to abandon the old business, but why keep trying to live in a worsening environment?  If the market is shrinking, isn't it smart to find new markets.

Take for example the behavior in retail.  We all know that Circuit City went out of business, and lots of other retailers like Mervyn's and Filene's Basement have filed bankruptcy.  It's tough on retailers.  Especially those who keep trying to do the same thing.  But some are taking actions to change in order to be more competitive.  Nine West and some other retailers are changing their approach as reported in, "Gap, Specialty-retail stores mixing up brands."

"Consumers are interested in the best of the best.  Not the best of what your brand has to offer.  Retailers are learning not to put all their eggs in one basket.  If it doesn't work, you just get rid of it."  Now that's some advice worth listening to, offered by Marshal Cohen of NPD Group.  When markets shift, you have to shift.  Waiting around for customers to come back to you is not a viable option. 

Retailers that are growing are using test markets to try new things.  Like Nine West partnering with New Balance on a new shoe that is attracting a lot of young shoppers.  Not everything works, at Cache the store tried some new brands but the test reinforced that people were looking for the Cache brand rather than the products Cache tested.  That's the benefit of testing, you can learn.  As you learn, you can adapt and adopt new behaviors. 

Retailing is going through a massive market shift.  Those who survive have to learn a lot more about individual stores versus malls, and on-line versus in-store.  They have to learn about brands and about store brands and what people now want.  Those who don't have ongoing White Space tests are failingThose who are have a much better chance of surviving

So, if your market is shifting, you need to MOVE.  Whether you make car parts, aviation parts, furniture, windows,
clothing, candy – anything – you will see your market shift because of
the globalization of new technology.  When markets shift, the thing you shouldn't do is "wait it out".  That is not a viable strategy.  That's putting your head in the sand.  Just because you aren't certain what to do doesn't mean you don't take action.  And that's why White Space projects are critical – because the only way you can develop a new Success Formula is by trying it in the marketplace.   You don't want to end up like all those going out of business because they keep trying to do what they always did, only cheaper, faster or better.  You have to start doing different things.  And NOW, because the market keeps shifting more every day.