You are not alone in the trail of small businesses. There are trillions of business owners on this challenging trail. They are the major contributors to the strength of US economy, representing 99.7% of small businesses. The trend of small businesses is multiplying since 1982, however, if you are planning to take the plunge as a small business owner, know that nurturing a small business start-up requires a lot of hard work, patience, perseverance, and commitment.
Taking it to the next level would require potential lot of out of the box thinking but it isn’t impossible. In fact, small businesses have more potential to lead the market than big businesses. Since 1990, they have doubled the job opportunities to 8 million due to the elimination of jobs by big businesses.
In the last years, small businesses have contributed around $6 trillion to the GDP. They can either be home-based or online, and therefore offer more flexibility than big businesses. Small businesses are becoming better than the big businesses in several ways. Small businesses include small boutiques, coffee shops, local pet shop, small bakeries, small service businesses etc.
We have come up with certain views by experts determining the superiority of the small business start-ups over the big businesses. Additionally, how they are competing their small businesses with big business leagues.
1. Big Companies are Big – Henry Elkus
Henry Elkus (former president of Unlimited Ltd. Clothing) believes that the biggest disadvantage of bigger firms is their huge size. This limits the flexibility of the business. Small businesses enjoy a competitive edge due to agility. Zara, one of the leading clothing businesses follows strategies established by small business owners. They produce swiftly and remove any underperforming products.
Additionally, big businesses spend millions of dollars on the R&D department to discover the latest research and trends. The product needs to go through a number of middlemen once they decide to produce it. But if it is not able to perform well in the market, they are left to deal with colossal quantities of stock. On the contrary, Unlimited Ltd. Clothing always looked for niches and fearlessly competed with big businesses because they had an advantage. A well-tuned small business can easily outperform its larger counterparts in customer service, product output, quality control, and trend identification.
2. Small Businesses are more Flexible in Nature than Big Businesses – Carol Ostrow
The biggest advantage of a small business is its agility. Carol Ostrow (Founder of the Flea Theatre) thinks that small business owners have this huge competitive advantage. She thinks the bigger the firms, the greater the complications. Large firms are bulky having a larger budget, larger staff, larger client base, severe losses, and longer decision making process that comes with high risks.
On the other hand, small businesses can overcome the risks because of their flexible and agile nature. They can easily change directions, circumvent obstacles, reboot plans, and are responsive to opportunities and adversities. She also thinks that her firm, the Flea Theatre is in competition with the largest theatrical institutions in the NYC but the take it as a challenge and not a threat. Her firm believes in playing vibrantly and confidently to stand different and unique.
3. Small Business Owners Should Never Fear Big-Business Goliaths – David Kalt
David Kalt (founder at Reverb.com and owner of Chicago Musical Exchange) thinks that every small business faces a Goliath. Sometimes they face it early on and sometimes later. Both his businesses belonging to the music industry compete with giants. He encourages the Goliath in businesses. This is because when the Goliath is targeting your business, they also validate and promote your product or service. This will eventually lift your business.
Mostly all the small business owners are able to compete with these Goliaths. They should never fear from them as they have the advantage of being nimble, energetic and flexible to compete seamlessly. David thinks that you can always come up with a new product if a Goliath targets your product. Also, you can undercut your prices and build an unmatched user experience.
4. Secret Weapon for Small Businesses: Close Customer Relationship – Mary Liz Curtin
Mary Liz Curtin (owner of Leon & Lulu) believes that bigger firms are not always better. Size doesn’t matter every time, but the quality does matter. No matter the size of the business, you must ensure to identify and define your business clearly. One of the best perks of small business is that they understand clientele and maintain longer relationships with them. You customer base is the most important asset for your business.
On the contrary, it is difficult to maintain a good and close relation with your clients and customers when your business moves into space. Bigger businesses get busy and may not stay in touch with their clients keeping them aware about the products or services. However, smaller businesses are faster and in close touch with the customers. All small business owners must understand that the service we offer to our clients only keeps us in the business. Consequently, you must ensure to think about the customers first and make them loyal.
What Should Small Business Owners Do – Be Confident, Fearless and Adaptive!
All small business start-ups should be confident to run their businesses with the big leagues. They have already proved that their business provides what the market needs so they need not worry. Instead they should focus on the healthy competition keeping in view their customers’ requirements.
You must identify your advantage of being nimble, flexible and agile and adapt according to the environmental and customer’s needs. As per the experts, your small businesses can compete well with the bigger firms as they are swifter in nature. They have the potential to bring in new products in the market. If you still haven’t taken the plunge for your small business, you must start now. Good Luck!