Family businesses often find that they are pushed to their limits by the demands of competing with big box stores. With advantages in price, big box stores have been able to drive many smaller companies out of business. However, there are ways in which small businesses can positively compete with the behemoths, using their strengths as ways to combat the spread of big box stores. Utah business leader Jason McLaughlan of Western Fence Inc. offers suggestions to family businesses that can help them compete with the largest industry players.
Focus on Service
While big box stores have an advantage in the prices they are able to charge, the small family business can offer something that the big box store would struggle with. Excellent customer service helps to set small businesses apart and to build customer loyalty. When customers have problems with big box stores, their protests often fall on deaf ears. Big box stores are simply not able to provide customers with highly personalized service. This is also true of family service businesses which compete with home improvement stores.
Convenience
It may seem counterintuitive that a family business could have an advantage over big box stores when it comes to convenience, but it is often much easier and faster to make a quick visit to a small business than a drawn-out expedition to a big box store. The distance that a customer needs to walk just to pick up a simple item represents precious minutes in their day. For example, small hardware stores are able to provide quick service to their loyal customers who do not want to spend half an hour getting one item.
Small businesses may also have an advantage when it comes to parking and access. Family businesses are generally located in the middle of town, and many have adequate parking and access. Big box stores are often located on the edge of town, necessitating more driving and taking more time out of a customer’s day.
Knowledge
A big box store carries so many products, it is impossible for their employees to truly understand them all. No matter how dedicated a big box store employee may be, they are always at a disadvantage compared to the more knowledgeable employee of a family business. Family business owners can share their passion for their area of business with their customers, building enthusiasm and company goodwill.
Creativity
One of the biggest advantages that a family business has over a big box store is creativity. With the ability to adapt promotions and advertisements to the local population, family businesses have a much better idea of what their customers want. They can use their creativity to reach their customers in new and exciting ways.
Understanding the Target Market
While big box stores generally have only their sales data to judge their effectiveness, small business owners truly understand their target market. Big box stores may have more access to demographic data, but they do not have a good grasp on how their customers live and behave. For example, small businesses can reach their customers through charitable giving, community involvement, and philanthropy. Big box stores may try to put these policies into place, but their efforts are generally lackluster on the community level.
Flexibility
Small businesses have another large advantage over the big box store when it comes to flexibility. If a sales technique or advertisement is not working, they can quickly shut it down. They do not need to communicate with a distant home office which may or may not take their concerns seriously. Small family businesses truly care about how their customers see their products, and they are able to make changes that a big box store can only hope for.
Competition is Possible
While many small family business owners may feel discouraged about their ability to compete with large big box stores, they need to keep their own strengths in mind. Fully understanding their products and services as well as the local community gives small family businesses a competitive advantage. Companies are able to deal with challenges in creative and flexible ways, ensuring that their business strategy remains up to the minute. Jason McLaughlan reminds small family business owners that their business is only as good as their ideas.
