One respondent to last month’s survey described their greatest fear for the shop in the following way:
“That I won’t be able to compete with bigger stores: keeping the traffic flow constant, as more and more shop online with the “majors”, and avoid shopping centres in general.”
It’s a very real concern with many of our customers who could be described as small businesses. First, we have some encouraging news – you, as a small business, are in the majority. According to the Australian Government Statistics, 92.2% of retailers in 2009 were small businesses.
However, that doesn’t mean that it’s not tough for you. Only 37.2% of the Retail Industry value lies in small business. You need to use your strengths to aggressively take on the big box retailers. Here’s how to do it:
Use a lack of staff to your advantage
One massive difference between a large company and small-medium enterprise is (unsurprisingly) the staff levels.
Big guys just have more.
However a lack of staff is no disadvantage to a business – there are things you can do with a few staff that you could never do with 200.
Like implementing policy changes; let’s say you, the business owner, have just rewritten the policy on customer complaints. There’s no board of directors required to approve it, you don’t need to do a half-day’s training with everyone – all that’s required is a group huddle before opening to let them know what’s going to be different.
And you can keep an eye on your staff. In a large organisation poor customer service is often unnoticed by management. Observe customer interactions on an everyday basis and address issues individually.
Foster a degree of team loyalty that is unattainable for large corporations. You have the power to turn your team into a close-knit group of friends who will support you in and out of hours, and even attract customers through their own word of mouth.
Use a lack of products to your advantage
You may never stock thousands of brands like David Jones, but the difference is this: When a customer asks you about a product you tell them a story like this. You can, because you know the story, and because you have the time to tell it. That’s the difference between you and a store manager in a multinational corporation.
The beauty of a small business is the closeness of the customer and the supplier. You can literally trace your products to their source, and support suppliers locally if you wish, all of which your big-scale competitors will find challenging to do.
Choose to own a niche in the market. You will become a destination for a specific product or range and develop close relationships. Ask for Word of Mouth referrals to develop a loyal tribe of interesting, interested customers.
Use a tight budget to your advantage
This is an unexpected advantage to you: less income than your big-box competitor equates to less wages to pay, less people to please and less rules.
A tight budget means you must use creativity and innovation in marketing. Become an early adopter of trends – you can because you don’t have policy-changing rigmarole to go through – as most technological and online products are inexpensive when new and untested (especially when they are in Beta). Position yourself as a thought leader in your industry; by giving advice on the products you sell, to garner free publicity.
Use the internet to your advantage
Get a website.
A website is profitable investment for any size business. It’s inexpensive in the long run. It encourages word-of-mouth marketing and is far more effective than any billboard, as people will rely on the advice of friends over a faceless corporation advertisement any day.
If you have a website, publish as much information as you possibly can on it. Allow people globally to buy from you.
You may have limited opening hours, possibly shorter than large corporations, but your website will operate 24/7.
Big retailers have websites, but don’t let that put you off – you’ll never succeed by avoiding opportunities.
Here a tip on how to stand out online: Large corporations tend to ‘talk down’ to customers, give minimal information and make purchasing difficult on their website. You don’t have to. Your customers will love the difference!