Businesses like Home Depot and Wal-Mart offer convenience and affordability to many consumers. The harsh reality of this is that the Wal-Marts of the country tend to sap business from small local businesses. These smaller entities offer similar inventory but are unable to keep their prices comparatively low for several reasons, mostly due to tax breaks and inferior resources.
There are very few industries whose local small businesses are not threatened by larger competitors, or at least the prospect of them moving into the local community. It’s important for all businesses to prepare for the potential impact.
Heed the tips below to remain locally competitive against big businesses.
Remain Locally Competitive: Prioritize Customer Service
One of the most common criticisms of large companies like Wal-Mart is that their customer support is severely lacking. In a thorough article on Kabbage that touches on this issue, several business leaders stressed the importance of customer service for local small businesses in response to the subpar customer service of larger competitors.
“Many people have found that not only is the quality not always there, but the customer service [of larger competitors] is lacking,” explains Craig C. Powell, CEO of 5 Block Radius. “We know what we do and we love it, and we want to create those feelings for our customers too!”
What Powell and many other prudent CEOs of small businesses are doing is emphasizing customer service, recognizing that quality of customer service is determined by effectiveness, not size.
So while the Wal-Marts may be able to outprice small businesses, consumers who recognize the importance of customer support – which is many – would rather pay a little extra for that, as opposed to saving some on a product.
Maintain a Prominent Internet Presence
With practically everyone on social media now, a business would be foolish not to capture their audience on the Internet. Small local businesses should use their local connections and pride to connect with locals in the area. This can be done in two ways:
- Regularly providing interesting content on social media
- Showing support for the local community
Both tasks can be easily accomplished with tweets or Facebook posts.
As this Entrepreneur article explains, it’s important for businesses to nurture their social media following because Google ranking regards social media presence as a prominent factor in its algorithm. A small business has a smaller scope than big corporations, but the small businesses are able to better provide a humanized, personal experience to their followers, a fact that they should take full advantage of.
Strive for a Highly Connected and Collaborative Company
A Forbes study found that companies who utilized enterprise collaboration platforms to better connect their company experienced a 12% increase in sales, a 75% decrease in support calls and a 75% decrease in the time required to generate and maintain content.
Indeed, seamless collaboration and communication makes any business more efficient by providing employees with a transparent flow of information that can better aid their tasks and result in a more optimized work environment.
Speaking of collaboration, some small businesses could prepare for an incoming larger corporation by considering a collaboration or merge with another small local business specializing in a similar niche. There are many strategies based on collaboration and connectivity that can excellently prepare a small business for a larger competitor.
It’s important to remain personal and connected with customers on a more intimate level than that of larger businesses, but small businesses also need to exude a certain level of professionalism reminiscent of these larger corporations. It shows a level of organization that consumers are confident in.
Small businesses should strive to make every aspect of their business professional, from the way they answer the phone to general attire to the design of their business cards or web site.
Focus on a Niche
Superstores like Target or Wal-Mart may be able to cover mostly every industry, but there’s rarely a passion for that niche demonstrated by employees or the general selection. A small business, on the other hand, can choose to focus on a niche to a substantial extent, holding events that would interest this demographic.
Provide Personalized Value
Many big-name stores are great at providing value when it comes to costs; however, small businesses are able to provide personalized value that large business cannot. Providing customized services and a more personal approach can greatly enhance the value a customer feels they are getting. For instance, contracting company Sunshine Contracting offers a learning center and free estimates to provide enhanced value to their customers throughout projects.
Small business can also provide media representative of their passion, such as a YouTube tutorial for the field. For example, a local hardware store could create a video tutorial on how to build a deck chair, which has the chance to go viral and provide advertising that rivals the large competitors. By presenting this tutorial to their audience on social media, they’re providing a valuable resource. They also affirm that they are truly passionate about the subject and should be considered the knowledgeable go-to source in the local area.
The prospect of a Wal-Mart moving into town can be daunting for small local businesses, but the tips above can help them prepare for it by embracing local roots and small business passion. Any quality small business can compete with the likes of Wal-Mart, Target and Home Depot with the right strategy.