There are thousands of resources dedicated to business strategy. One the hardest business strategies to define and adhere to is a highly defined niche strategy.
A niche strategy, at a very high level, could be described as a focused area of a market that a business serves well. One business that has found its success by specializing and serving the specific needs of a very targeted, defined group of customers is Fortune Transportation headquartered in Windom, Minnesota.
Perry Olson, owner and CEO of Fortune Transportation, recently took time to share their story with us. Fortune was founded in 1980 when Perry’s father started the business with one truck. Today, Fortune has over 150 over-the-road refrigerated trucks with terminals in Windom, Minnesota; Greeley, Colorado; and Roswell, New Mexico. Fortune’s success stems from hard work and determination plus a unique niche strategy and culture that differentiates them from their competitors – a niche strategy that is a marketer’s dream.
Niche Business Strategy
Perry and the Fortune Transportation team could teach a class on how to develop and perform well with a niche strategy.
“Fortune provides refrigerated transportation for the dairy and beverage industries,” Perry said. “Regardless of the economy, people always want cheese, beer, pizza, and ice cream. The customers we haul for tend to be medium-sized companies and the routes we cover are smaller and more specialized as well.”
The benefits of a niche strategy include:
- Recognized expertise – Product, service, or market segment specialization that a company is known for.
- Decreased marketing costs – Targeted outreach and laser sharp focus as it relates to both effort and spend.
- Reduced competition – Differentiation among a vast array of competitors.
- Established customer base – A reputation within a defined market.
- Increased profit – Customers that tend to be less price sensitive.
Perry acknowledged that adhering to a highly defined niche strategy takes discipline and a certain stick-to-itiveness.
“We’ve had many opportunities to grow outside of our niche, but we’ve stayed focused on dairy and beverage because that’s where we perform the best. Admittedly, one of the drawbacks of our niche strategy is that it’s harder to replicate on a larger scale and still deliver exceptional service and on-time delivery performance. However, our customers tend to be less price sensitive, and our niche is somewhat recession proof.”
Corporate Values and Employee Engagement
Fortune’s formula for success goes beyond a niche focus. Their fleet of semis and refrigerated trailers are modern and top-notch. And, their employee engagement appears to be rooted in strong values, including ability-driven loops, level pay, home time, respect, looking ahead, and safety.
The day after we met with Perry, he left for Fortune’s Roswell, New Mexico, terminal to kick off Truck Driver Appreciation Week, a program that recognizes the over 3 million male and female truck drivers for their commitment in keeping the country moving forward.
“Mutual respect is important. We believe in working while you’re on duty, and spending time with your family while off duty,” Perry said. “Our driver’s benefit from being able to be home weekly for their 34-hour reset in the comfort of their home. Also, when a driver hits 1 million miles with Fortune, they get to choose the color of their truck.”
When asked about the challenges he’s facing, like many companies it’s difficult to find drivers. “If Fortune could find 20 new drivers, we could put them to work tomorrow,” Perry said.
Financial Partner for the Long Haul
“I always say that it’s more difficult to stay the same, yet still stay on top,” Perry said. “Working with Mike LaMaack and Justin Schmit at Bank Midwest has been consistent, and they’ve been flexible as we’ve worked through cycles. It’s been a long-term relationship and if we’ve ever needed anything, they’ve been there for us.”
To learn more about Fortune Transportation, visit www.fortunetransportation.com.
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