Power of Niche
This is a restaurant review cum a business lesson.
There is a small eatery in Rajouri Garden by the name of Pehlwan famous for serving mouth watering magaj, mutton tikka, kebab and Mutton chops.
I am not exaggerating ladies and gentlemen; the guy at helm has magic in his hands. What he dishes out is so awesome that I am sure you would not have eaten food this good anywhere else.
5* hotels boasting off celebrity chefs cannot dream of competing with his food. You see they can garnish their mediocre food with coriander and julienne’s of ginger , what they cannot replicate is the ‘TASTE’.
That got me wondering as to what exactly is his secret. I mean, what is there to it. All you need is a Tawa and a few ingredients (which are NO secret as it is a stand and eat shop and he cooks right in front of you). What can be the reason for such amazing craftsmanship with the same set of tools available to everyone?
After contemplating on this topic for a while 02 important points came to my mind.
When you combine these 02 potent forces together, you can have some AMAZING results. Right from Vivekananda to Charlie Munger have been advising the youngsters the very same thing.
Take a small idea, make it your own and keep pounding away at it.
The chef’s who pass out from celebrity institutes are Jack of All idiots. They know how to cook 800 dishes. They know a 1000 other things apart from just cooking. Apparently this makes them all rounded personality. Unfortunately All rounded personalities don’t have an EDGE (Pun Intended) and so they are average on Average.
Our dude at Pehlwan has only 04 dishes to concentrate on. He has mastered the art on only 04 items so well and for so long that now he has transformed it into some kind of art form. I am sure you guys must have seen Jiro dreams of Sushi.
Right from how much heat is necessary to how much salt, pepper etc to go in, he works like a man possessed. His body is synchronized with the chronological schedule of what ingredient goes after which. It is fascinating to watch him cook, it is almost as if he runs on an AUTO PILOT.
Taking that example to the business world, barring exceptions, niches would always perform better than BIG conglomerates. Big diversified companies are functionally equivalent of a celebrity chef (Jack of all idiots). On average, their performance is average. Something like an INDEX fund. It will be a lot smoother than individual companies.
That brings me to the disclaimer. Of-course it is a 02 edged sword. If you do not have a defined edge in your chosen niche, the same sword will cut you in half mercilessly.
The investment lesson is that if you don’t have an edge, all of a sudden Average (INDEX) looks like a great outcome.
The real test of character is in KNOWING oneself. It requires a lot of (Above average) courage and character for an average person to realize and confess that he is. (Average)