Unsurprisingly, 10 Businesses Facing Extinction in 10 Years includes pay phones, record stores, newspapers and coin-operated arcades, according to Entrepreneur magazine. What I found intriguing is the suggestion that the best of these dying breeds will probably continue to hang around for a long time. Anita Campbell, who led me to this article, believes that You Can Make Money Even As Your Industry Declines. She comments that:
Some businesses actually manage to achieve temporary growth spurts in the midst of dying industries. For instance, you may see consolidation plays where one player buys up other struggling players (say, to maintain economies of scale in production facilities) and milks the remaining years for every dime. Or the stronger players just out-wait the pack and gobble up the crumbs left behind as competitors go out of business one by one. Or sometimes businesses branch out to foreign markets where the rate of decline may be much slower.
The smart companies in declining industries deliberately cannibalize their own businesses. As the old industry is declining, they invest in alternative business lines or disruptive technologies that are replacing it.
The lesson for all businesses is to stay on top of industry trends and understand that competitors may not even be in the same industry you are. If your growth curve flattens out — you are tracking this, aren’t you? — take a look at the maturity of your industry. If a newer technology is starting to replace what you offer, consider broadening your business model to participate in the new sector.