You do not want your firm stuck in a "commodity market." In a commodity market, your products cannot be differentiated from the products of your competitors. Thus, the success of a business is based completely on product price. The only way to compete is to reduce prices. Small scale firms are disadvantaged because their cost per unit of output is almost always higher than that of a larger scale business or big box store. Without product differentiation there is no room for your business to shine.
You want a special niche for your business. You want to separate yourself from the competition in the minds of customers. You want to insulate yourself from price competition. To do these things you must make your products different in some special way from similar products sold by your competitors. Some things that might differentiate your products are special quality, variety, additional processing, special services, convenience, location and special information available with your products. Such differentiating aspects of products are often called value added, because they can make products more valuable to customers.
focuses on writing a statement of how you see your firm positioned in the marketplace. Use your thoughts about customer needs and how they relate to product characteristics, competition, place, pricing, packaging, and promotions from Worksheet 4. The statement of position should indicate what niche your firm will fill in the market.