How Small Businesses Compete With “Big Box” Retailers
It is given that “big box” retailers can purchase their offerings at a significantly lower cost than most small businesses. Even so, smaller competitors can compete on value which, in turn, provides them with a competitive advantage on price. Although small businesses cannot win the price war, very often they can prevail in the value battle.
In this context, value means all of the products/services that the small business brings to bear. If your small business delivers some kind of demonstrable benefit(s) or advantage(s) to customers/clients, a thorough knowledge of those customers/clients will be paramount in creating and articulating an effective sales strategy. Compare your company’s products, services and/or pricing with that which your competitors offer. If your enterprise offers interesting/useful characteristics such as a liberal customer/client return policy or discounts on large purchases, you ought to emphasize those advantageous features to any prospect or customer/client who wants you to compete on price. Many small businesses owners do not fully appreciate that being locally owned and situated has value to their customers.
Obviously, big box stores hire local workers. However, the profits from those boxes are delivered to their corporate offices. Accordingly, those boxes do not impact the local community as do the locally based companies. On the other hand, net revenues derived by local businesses typically stay in the area. Local firms are the ones that keep chambers of commerce afloat and contribute much to ensure the vibrancy of their communities.
Each small business owner would be well advised to remind prospects, customers and/or clients that their enterprise is local. Do not assume that all prospects, customers and/or clients know that your enterprise is purely local. In addition, it is important that to remind them frequently that your enterprise and, if appropriate, you are making a contribution in the
community.
It is inevitable that some customers/clients are “bargain shoppers” who demand the lowest price. Small businesses will retain those customers or clients until they leave to find lower prices/fees. So, instead of chasing the lowest price, small business owners would be well advised to develop customers/clients that are loyal to their enterprises because the enterprise owners have provided them good value.
You might be well advised to regularly explain this value proposition to prospects and reinforce it by means of routine communications with leads, customers and/or clients. Obviously, the more effectively you communicate this concept, the more likely you are to develop customers/clients who are loyal to you despite lower prices offered by competitors.
Helping Small and Midsized Manufacturing, Wholesale Distribution and Online Retail Businesses Grow
Why do numerous growing small and mid-sized businesses rely on Cornerstone’s expertise for business process automation and integration, enterprise resource planning (ERP) systems, technical support and marketing strategies? Simply stated, our team knows how to help businesses grow. We’re definitely Not the “new kids on the information technology (IT) block”. For more than thirty years, Cornerstone’s brilliant team of marketing strategists, consultants, CPAs, and (U.S.-based and English speaking) programmers have been providing high-performance business software, as well as unparalleled technical support, to small and midsized manufacturing, wholesale distribution, and online retail enterprises.
Cornerstone Consulting’s areas of expertise include, but are not limited to:
- SAP Business One
- E-commerce / M-commerce
- Mobility
- Business Intelligence
- Business Analytics
- Internet
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For SAP small business software information and/or marketing advice, please contact Cornerstone Consulting at 813-321-1300.
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