Small-business owners can successfully compete with large business
Increase profits by effectively competing with market leaders.
Many entrepreneurs worry about losing sales to large competitors and many don’t believe they can compete effectively. Here are a few things Michigan State University Extension suggests you do to maintain or build your sales in a competitive marketplace:
Market what your competition doesn’t have
You are the owner. You are an expert in every aspect in the industry. “You” is what your competition does not have. Your expertise, your knowledge, your experience, your passion. If your marketing communications and advertising only mention price, you’re missing out on a large customer need for knowledge.
For example, a large big-box retailer sells copper piping for household plumbing. However, if the consumer really doesn’t know exactly what they need or how to use the product, they cannot rely on the clerks who work there. Therefore, if you sell copper pipes, you will have the knowledge on how to install them, what products are needed to attach the pipes, where you can and cannot use the copper pipes, how long the pipes should be, etc. “You” is what you’re selling: expertise, knowledge, assurance. Consumers cannot get these from a typical big-box store.
Provide a depth of products
Large competitors have many things going for them—mostly they have, literally, many things. Take a large mass merchant for example. They have products in virtually every category — literally from soup to nuts — but they don’t have depth. You might find children’s bicycles at a big box retailer, but maybe only one style from one manufacturer. You, on the other hand, may have children’s bicycles, but you should have many styles from many manufacturers. This gives you a depth in your product line.
You can compete by offering a limited breadth of products that are deep. This competitive strategy works well if you have a specialty product or service. You can offer many varieties of a single product line whereas large competitors will have many products with limited varieties.
Compete with time utility
In the retail environment, if you’re not open, you cannot make a sale. It’s a pretty simple concept — be open when your customers are available to shop. Although this is a simple concept, this is an underused marketing tactic. This is the first advice I give to my clients who come to me for help in increasing sales. The following should clarify why it’s important to be open.
My workday is over at 5 p.m. I need a gallon of paint for my living room. I choose to go to the local hardware store to pay a lot more for the paint than I would at a big box retailer. However, the hardware store closes its doors at 5 p.m. So, I get back in my car, and I drive another 30 minutes to go to a big box store that is open until 10 p.m. This happens over and over and over again. Eventually, I will never think about going to my local hardware store — even when they are open. I just drive past them to a store I know will be open.
Now, go compete against the market leaders—and show them that you’re not going to back down.