Give Your Startup an Edge by Going the Extra Mile

Don Quijote, or commonly referred to as Donki, claims to be the largest discount chain store in Japan. One of the key success factors for Donki is the low prices it charged. The company’s discount business took off in the 1990s with the bursting of the economic bubble in Japan. However what is noteworthy is its attraction to tourists who are seduced not only by its low prices but by getting a tax refund on the spot. This happens not at the airport store but elsewhere such as its stores in Tokyo or Osaka. Furthermore tourists need not make a sizeable purchase to qualify for the tax refund, unlike many other outlets providing such services. Even those purchasing groceries for less than ¥2,000 (about $18) can claim for the tax refund. However Donki too has a floor for branded goods like handbags at its outlet.

What proportion of Donki’s business comes from tourists is not known. However, the fact that tourists make a bee line for its outlets when visiting Japan is testimony of the attractiveness of its tax refund service. Since the minimum purchase amount for the tax refund is relatively low, one can only imagine the volume of paperwork that Donki has to process in order to claim back the tax paid from the Japanese government.

Many companies refrain from incurring expenses to do such work with what they perceive to have low returns. As a result of their myopic views, they are unable to compete with Donki. In the 1990s, non-fast food restaurants providing home delivery services were relatively unheard of. Today, with the proliferation of food delivery services, it is soon becoming the other way around. The reason is simple. If everyone is doing it and you don’t do it, you are at the losing end.

When starting up a business, look for areas where you can provide a service which competitors refrain from doing. In other words, if everyone is not doing it and you are the only one doing it, you are a winner.

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