There are between 3,000 and 4,000 Pregnancy Help Centers spread out across the United States.
That sounds impressive, but as we discovered in yesterday’s article, it’s not a good thing because many of those centers are located in areas where there is low demand for abortion.
Why does this happen?
We’ll explore another reason in today’s article using the economic concept of “market barriers to entry.”
How Much to Get In the Game?
In any given market, asking the question, “What are the barriers to entry?” is essentially asking, “How hard is it to get started with a business in this market?”
An example of a market with high barriers to entry is the commercial airline industry.
To start a commercial airline business that would compete against the likes of American, United, and Southwest Airlines, it would take hundreds of millions, perhaps even beyond a billion dollars, as well as passing innumerable regulatory hurdles and other obstacles, before you sold your first ticket to a passenger.
Such high barriers to entry in the airline business results in very few, if any, new airline companies coming into the market in any given year.
On the other hand, an example of a market with low barriers to entry is the internet information business.
You can start your online information business today, for example, selling your expertise in whatever it is that you’re an expert at, for less than $100.
All you have to do is register a domain name for a website (about $12/yr), buy web hosting for the site (about $70/yr), and load blogging software and a design template (both free), and off you go.
Now you know why there are literally millions of websites trying to sell you stuff! 🙂
Are low barriers to entry in a market good?
On the whole, absolutely.
But looking at the Pro-Life Business Industry, where the market barriers to entry are low, reveals that there might be some exceptions to that – especially once the market is well-established with many participants.
Let’s Start a PHC!
At the time Roe v. Wade became the law of the land on January 22, 1973, it was a great blessing that the market barriers to entry to start a PHC were low.
There was a great need to establish as quickly as possible in all cities across the country, an “on the ground” competitive counter to abortion facilities.
Almost half a century later, with three to four thousand PHCs now on the ground, I’m not convinced that low barriers to entry are still a good thing for the Pro-Life Business Industry.
I get inquiries all the time from pre-launch PHC start-ups looking for help with marketing.
When I ask about their motivations for starting a PHC, there’s a consistent theme in the answers – “we just felt called to do something to help save lives from abortion.”
That is a wonderful sentiment!
But does it mean you should start a PHC?
I think the answer to that is – it depends.
For example, it is possible that there already exists a PHC in your market area that is effective at competing against Planned Parenthood, as measured by market share.
If that’s the case, and you start another PHC, advertising a different brand name than the PHC that is already competing effectively against Planned Parenthood, then you could end up causing confusion among prospective clients, giving Planned Parenthood an additional competitive advantage in the process.
Ouch.
On the other hand, if you have a PHC model that you know will compete effectively against Planned Parenthood – and not because you just think so, but because you have data that proves the model is effective – and you also have data proving that current PHCs operating in your area are ineffective against Planned Parenthood as measured by market share, then your entry into the market could save the day.
In the former case where there is already a strong PHC competitor in the market, the best thing you could do with your desire to “help” is throw your support behind the existing competitive PHC to enable them to become even more competitive.
In the latter case, as I said, your entry could change the competitive game in the market for the better.
The problem is, in my experience, that start-up PHCs don’t do this analysis.
Because barriers to entry to start a PHC are so low – meaning there’s little risk involved – it leads to well-meaning folks just jumping into the market with a new PHC without doing the analysis to determine whether or not a new PHC was really needed in the first place.
More is not necessarily better.
To be continued…
Regards,
Brett
Bridget
You are dropping some thought bombs
Almost scary to.consider the miscarriage of assets. Borders on dark…hmmmm.
Bridget
You are dropping some thought bombs
Almost scary to.consider the miscarriage of assets. Borders on dark…hmmmm.