Last week I was invited to Chicago to speak about increasing store profitability to a group of independent camera and digital film processing store owners.

Camera store owners face extreme competition on pricing from the internet, drug stores and big box stores, plus consumer buying behavior, with respect to printing photos, is changing drastically. In the past, people would develop several rolls of film, looking for the perfect shot… now they average only four to five photos.

This means camera stores are at a major crossroads—they must answer the vital question of how they can grow their business when the market/demand for film prints is decreasing, and the market is more competitive than it's ever been.

The challenges of the camera store owner are almost identical to what we're facing in the gift industry—how can gift retailers grow in a tough economic environment, with big box, discount and internet retailers competing on price and acting faster than ever in response to new product trends?

So, what's the formula for success?

The answer is simple—retailers can grow their business if they follow these three steps:

1. Sell products that aren't found elsewhere
2. Offer top-notch service
3. Ensure your products are of great quality

Camera store owners have been forced to re-examine their value proposition and re-define what business they're in—changing from being just film processors to providing new ways for consumers to tell their story (maybe through photo gifts such as books or mugs and large scale photo prints). These products are not only unusual gift items, but also highly personalized where quality is important, thus giving consumers a reason to shop at their stores.

Now is the perfect time for all of us to ask: What business are we really in? Where are we headed in the next two to five years? How are we going to get there?