9 Tips to Compete Against Big Companies

"In the struggle for survival, the fittest win out at the expense of their rivals because they succeed in adapting themselves best to their environment." ~ Charles Darwin

When small businesses find themselves pitted against the big companies, a common reaction is panic. However, small can be powerful too as the biblical parable of David and Goliath tells us. Whether you are a small business supplier of drugs and intermediates or deal in office stationary, the following tips will help you compete better with the big companies.

1. Focus on a niche market – A niche market is a subset of the market based on factors such as geography, a line of products, demographics viz. age, sex, occupation etc. It comprises a narrowly defined group of prospects who share specific needs and desires that are different from those of the mainstream consumers. As a result, the small business even with their limited resources can better serve these market segments by offering customized offerings, because the products of the big business will often be too generic to suit the needs of a niche market audience.

2. Make your customers last a lifetime! – Brands and big businesses are more about perception than human touch. And people relate with people better than they do with objects. Small businesses are generally better known because of their people, viz. their founders. Build on this facet of your venture to consolidate and nurture long lasting relationships with your customers. You may also introduce loyalty programs for customers as incentives to stay with you such as gift cards, personalized reward schemes, etc. similar to the "frequent-flier programs" most airlines use.

3. Provide customer service with a difference – Bigger companies have multiple product lines, a large customer base, standard operating procedures, sophisticated software, but somewhere down the line a personal touch is lacking in their customer service. You as a small business can capitalize on this shortcoming of your bigger counterparts by providing personalized attention to your clients. Sell these benefits to your customers through small business advertising and other promotional campaigns that you carry out.

4. Compete with better control on employee performance – As a small business owner, you can keep a better watch on employees' performance of their duties and their professional conduct. Consequently, you can better control performance, and encourage and train them to strive for excellence, making it easier for you to achieve higher standards of professionalism and delivery of better services.

5. Don't skimp on employee training – Whether it's sales, customer service, or production you need to ensure that your workforce remains competitive enough to consistently deliver excellent quality service and products. Big companies do that often. To remain competitive you too should be prepared to invest in employee training. You may go in for video training, Internet training, in-house training by senior employees, etc if you find hiring consultants and credentialed trainers too expensive to afford.

6. Ensure Low Employee Attrition – As the owner of a small business with a lean structure, and fewer hierarchies, you can better interact with your employees, and spend time in building better employee relationships. As a result, you can instill more loyalty into your workers and retain them better than bigger companies. It also means that you can save more on your training costs, while nurturing a healthy workplace environment, enabling yourself to compete better. See "10 Small Business Employee Motivation Tips" for more information.

7. Compete on your ability to quickly adapt to the changing market - To remain competitive, businesses big and small need to change and adapt quickly to the market dynamics. However, big businesses, compared with small businesses are generally slower to adapt and implement changes due to bureaucracies, size, etc. So here's an advantage for you to bank upon in staying abreast with the market trends and requirements, and delivering what the customers want, increasing your chances of selling better. And outwitting the bigger market players.

8. Save cost with inexpensive promotion and advertising – Large companies have bulky and complex marketing plans, as a result they have to spend a great deal in promoting their services. You as a small business won't have that many resources, but you can still promote your products even on a shoestring budget. For instance, you can choose to participate in trade shows, small business public relations, by using promotional items, or through small business advertising, small business referral programs, online marketing, retaining existing clients with exceptional customer service, etc.

9. Join forces with other small businesses – Your business alone may have limited resources, but if you and other small businesses from your area pool together your resources, you can collectively compete better with the big business. For instance, if you as don't have enough money to buy ad space in a leading newspaper, all the small businesses from your area can pool in money to advertise as a group.