Now that you have established your business as a viable entity and have several successful years under your belt, deep pocket competitors view your business differently. You may even be formally identified in a corporate SWOT analysis as an “Opportunity for Growth” or a “Threat to Success” by their local manager. Depending on your situation, you may want to be acquired (Opportunity) or you may prefer keeping your business as an independent alternative (Threat) to the ubiquitous landscape of the corporate model.
Remaining independent as your business grows is more challenging because as you gain customers and market share, you also gain visibility within the larger corporation that is losing business to you. Imagine what it is like for the local branch manager of your competitor when he or she has to sit through another review with his manager and staff. They want to know why and how your business continues to win customers while their branch is not making its numbers.
Here are a few ways you can differentiate your business from your larger competitors and continue the success you worked so hard to establish:
- Leadership and Management Stability – This is perhaps the most important advantage you have because it is you and your management team that make the real difference. While local managers are likely climbing a corporate ladder and will be off to a different rung tomorrow, your team lives and dies with the success of your business. They live and work in your community and see your customers on the street every day.
Make sure you value their contributions and they know how important they are to your success. Consistency is a valuable component of any team, and all the people your management team deals with appreciate having a consistent management team.
- Employee Loyalty – Show your loyalty to your management team, and they will demonstrate it with their staff. An old maxim in the world of business it to “watch your numbers, take care of your employees and they will take care of the customers.” Go to bat for your employees at every opportunity. Be willing to sponsor their kids’ basketball team and donate to school projects.
Give them time off to attend school events and encourage them to coach the local team. They will return your loyalty with loyalty of their own when the big corporation tries to lure them away with more money.
- Industry Associations – Get involved in all the trade and industry associations you can find. Be visible; get on the boards and serve on committees. Being connected in your trade and industry has many hidden benefits. There may be merger opportunities that can make it even more difficult for a corporate competitor to use deep pockets against you.
Be careful not to directly poach people from other association members, but look for ways to develop mutually beneficial employment opportunities. Meet both formally and informally with others in his industry and develop cross training and employee-swapping opportunities.
- Customer Service – This is perhaps the most obvious example of how to differentiate your business and one everyone talks about, but have you really thought about ways your business can provide better service than your larger competitors? What can you do to serve your customers better? You and your staff more than likely know them and their families directly. You and they have long-standing relationships in the community. Extend the service from the counter to embracing those families in more ways.
Be visible in the community. Go the extra mile and encourage your employees do the same. If you are a retailer, meet your customers at the door, greet them and physically escort them to the location where they can find what they need. Visit an Ace hardware store and see the difference between how their employees help customers and how employees of the local big box store interact with their customers. Consider complimentary, free services like gift wrapping, etc. Be willing to share knowledge and be an information center even for items you do not carry
- Customer Loyalty – If you do not already have a formal customer loyalty program, start one today! Reward your customers for their loyalty to you because you know your larger competitors are constantly trying to lure them away with lower prices.
Develop formal incentive programs and discount schedules that clearly demonstrate how much you value them as customers. If you have a show room of any kind, always have the coffee pot on and encourage your employees to make them feel welcome like they would a guest in their home. Know their names and personally greet them at every opportunity both in your place of business and on the street.
- Vendor Relations – Your suppliers know for a fact that one of the reasons they are still in business is because you are. When large corporations are consolidating vendors and extending their payments out beyond 90 days, it makes doing business with you the preferred alternative. Instruct your purchasing department to always make payments on time and develop preferred vendor programs of your own. Join and participate in buying cooperatives to leverage your buying power with other independents.
- Community Service and Hometown Presence – Formalize your community relations programs and be as visible as you possibly can in the towns and cities where you are located. Advertise by being involved and sponsor local charities, schools and events. Encourage your employees to serve on the school board, the boards of local charities and other places where they can rub shoulders with your customers on a daily basis. Protect your reputation at all costs. It is one of your most valuable assets.
- Innovation and Agility – A very distinct advantage you have over your larger competitors is your ability to act quickly and decisively. Move quickly when local events impact your community and your employees. Whenever there is good news or bad news in your local markets, make sure you and your employees are on the front line filling sand bags or cheering on the local football team to its regional championship.
Consider a B2B CFO® Partner as Your Advisor
Every B2B CFO® professional has a minimum of 20 years of experience in the real world of small- to medium-sized business. They are not retired executives. They are not educators or academics. They are business savvy and understand what it means to fight in the trenches, yet they have the skills and tools to view your business at a strategic level.