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Saturday, August 1, 2015

Small Business Owner's Personal Touch Helps To Compete With the Big Guys

Small Business is the backbone of this country. I shudder to think what our economy would be like without small businesses providing jobs and tax revenue in every city and town in the U.S.

Many years ago, I worked with a woman who grew up near Louisville, Kentucky. One day, over lunch, we were reminiscing about our teenage summer jobs. Hers was working at her grandmother's pizzeria.

"Does your grandmother still make pizza?" I asked.

She shook her head. A Papa John's opened directly across the street. Grandma couldn't compete with its lower prices and broader delivery area. Once Papa started taking orders online, it was all over. Grandma shut her doors and retired.

Don't Let the Big Guys Sneak Up on Your Business

Don't get me wrong. I don't dislike Papa John's pizza; it certainly tastes better than some of the other national chain pizza. But it was sad to hear how my colleague's grandma was quashed by a growing chain.

Do you worry this could happen to you? Are you challenged by the proximity of a national chain with more money to innovate and undercut you? Do you feel like the playing field is tilting away at greater angles?

Don't despair. Fight back with what makes you unique to your customers and reminding them about it-your understanding of their unique needs, and the fact that they are people, not accounts. Stress the importance of supporting local business, and practice what you're preaching!

  • Every year, American Express sponsors a Small Business Saturday that usually follows Black Friday. If this or a similar campaign is in your community, join it.
  • Shop at local stores as often as possible. Resist big box stores except for items that really aren't available anywhere else. When you shop at local places, you learn more about the local business community and who knows, you may gain new customers directly or by referral.
  • Redouble your customer service efforts.

The last bullet is very important. The big chains do emphasize customer service but you can stand out because you and your employees actually know your customers, assuming your turnover is lighter than the average Wal-Mart's.

Sometimes you have to say this a little forcefully, particularly when the competition is much cheaper or even free. Ask your friends to stop Liking free website building services, for example; while they may be free, the sites are rarely attractive or particularly useful. Legitimate businesses don't sell a one-size-fits-all approach. But like you, they take the time to create customized solutions.

Always remember this, "People do business with people, not businesses." Probably the greatest advantage the small business owner has over the "Big Guys" is the business owner himself or herself. Take the time to come out from your office and meet your customers. Show some personality in your social media posts. People tend to know the name of the small business owners they frequently do business with. Anyone know the name of the CEO of Home Depot? If so, let me know in the comments below.

Look for Small Business Resources

If money is a growing issue, I can understand. It's been difficult for small businesses and entrepreneurs to get loans. Banks continue to sit on piles of money and have given many of us the cold shoulder.

More options are surfacing for small businesses that need to upgrade equipment, move to better locations, or simply need access to credit in order to respond to unexpected events. Here are few trends I've noticed:

  • Crowdfunding is set to take off even if the SEC is slow to release rules about who qualifies for equity funding. Colorado and Arizona recently passed legislation allowing non-accredited investors to buy SMB stock or invest in them ($5000 in Colorado and $10,000 in Arizona).
  • Online loans from companies like Kabbage, Accion, IOU Central, OnDeck and Can Capital often talk about determining small business' loan worthiness. These companies may be great sources of capital, but you want to look closely at the actual cost of the loan. Be sure you understand the interest rate and the loan origination fees, if any.
  • Mobile providers are abandoning long-term contracts after T-Mobile ended them in 2013. Many are setting up small business centers to cater to this previously overlooked segment.

Use tools developed for small business to help with your marketing and streamline your efforts to grow. Companies like Constant Contact and HubSpot really have the small business owner's back.

Of course, there's always Shark Tank. Many businesses that don't get an offer still benefit from the free publicity!

Do you have anything to add to this story? If so, leave it in the Comments below.

Brad Friedman is president of The Friedman Group, LLC. We work with professionals and business owners to develop strategies and implement Inbound and Social Media marketing to enhance your brand and generate leads and revenue. Contact The Friedman Group here.

By Brad Friedman

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