Battle tactics for niche firms

The toppling of some of the nation's largest corporations could clear the way for new and small businesses to carve out a profitable market niche or expand their existing business.

That is, if they can survive the recession themselves.

"There isn't a small-business owner in America who hasn't woken up at 3 o' clock in the morning and wondered, 'Is my bank going to make it? How am I going to pay my credit cards? How many employees do I really need to carry into 2009?' " said Henry Dubroff, a small-business owner and co-author of the book "Battling Big Box: How Nimble Niche Companies Can Outmaneuver Giant Competitors," which will be published in January by Career Press.

He hopes the book will be a guide for the growing ranks of people trying to start a business after a corporate career, as well as those already fighting in the small-business trenches. In the book, "big box" refers to any large competitor a small niche company faces.

"The people who make it through this particular recession, and who have the courage to start a business in this time, really need a new kind of road map," said Dubroff, who founded a weekly business newspaper, Pacific Coast Business Times, in Santa Barbara in 1999.

The book, which was co-written by journalist Susan J. Marks of Denver, is peppered with excerpts from the notebooks Dubroff has kept to track the sometimes wild ride he and his business have been on for almost a decade.

Dubroff, a former business editor of the Denver Post and onetime Denver Business Journal editor, writes about what it was like to skip a paycheck for three months to cover bills and severance payments after difficult layoffs at his fledgling business.

The book also taps often-used examples of famous entrepreneurs, such as Kinko's founder Paul Orfalea and MackayMitchell Envelope Corp. Chairman Harvey Mackey. They have good advice, but small-business owners may find the experiences of Dubroff and other owners of still-small businesses quoted throughout the book even more applicable.

Dubroff spoke with The Times last week.

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Where do most small businesses fall short?

A lot of people who start companies, or who are running companies that are niche companies, come out of a larger business environment. So one thing about cash management, you really have to scale the business to the size of the market; that's critically important. Don't build a company to handle $10 million in revenue if you are likely only to get $5 million early on.