The majority of innovation comes from companies with less than 500 employees. Of those small businesses, most of the innovation comes from sole proprietors. Think Bill Gates and his garage. Consider all the app developers working from home computers as we write this post.
Remember the 80/20 rule. Most of your revenue will come from the top 20% of your customer base. Customer focus has always been the advantage of the small business owner. You will never compete on price with the big guys so do not try. The most valuable market niche is the customer segment that wants personal service and is willing to pay for the attention and convenience. No one provides personal service like the entrepreneur.
Personal accountability and integrity can never be matched by large corporations. The size of the large corporation is the greatest weakness. There are simply too many levels between the corporation owners and the customers to provide accountability that premium customers expect. Conversely, there are often zero or single digit layers between a small business owner and his customers. It is amazing at how much care goes into a product or service when the business owner is in the same room as the customer.
If you are delaying chasing your dream of starting your own business because you fear the big corporations then eliminate that falsehood from your excuse box. It does not exist. Small business competitive advantage lies within premium customers, the customers everyone wants. They are yours and they always will be. It is up to you to earn their loyalty.
How do you treat your best customers? Please share your thoughts.
Business strategy for success demands business knowledge. Six years and $60,000 worth of business education is not required but it is wise to have such a trained expert on your speed dial. MBA ASAP is a series of blog posts, by such an expert, to share the fundamentals of building your own brand of success.
Myth: Small businesses cannot compete against corporations like Wal-Mart and Home Depot. Fact: There are certain small business advantages that large corporations will never match. There has never been a better time, in history, for one to pursue an entrepreneurial dream. Computer technology, the internet, computer apps, and social media marketing have leveled the competitive playing field for the little guy wanting to make it big. Here are three competitive advantages for the entrepreneur:
- Innovation – Most innovation comes from small business owners.
- Customer Focus – No one provides better customer service than the business owner.
- Integrity – Integrity is highest when the customer and the entrepreneur are in the same room.