Six Strategies to Compete In Business

In a recent interview I was asked how a small business owner can use customer service to compete when a big company comes to town. The little guy is fearful of being pushed out when a large national competitor known for low pricing sets up shop in his town. How can he survive? The business strategies that I came up with while writing this response go beyond customer service and are actually sound strategies for companies of any size, not just the small local business.
It has been repeated countless times all over the country – news that a “big box” store is coming to town puts fear in the hearts of local business owners. How can they compete with the low prices and selection offered by the likes of Home Depot, Lowe’s, Costco and Sam’s Club? They worry about losing their customers and attracting new ones. They see their limitations – smaller advertising budget, inventory, buying power, and so on. And yes, these may be valid conce
s, but they are also just excuses. There are many small businesses that have found ways to survive and thrive after a big box store moves in.
In reality, the threat of competition is the same no matter if the new business in town is a big box store, major chain store, discount store, or any other. It could be another small business opening up. Whatever your industry, any competing business that moves into your territory presents many of the same competitive threats.
But there are ways to stay on top.
1. Make it about more than the product. Here is where customer service comes into play. A small business may not be able to offer customers a lower price for its goods and services, so it must offer the customer another advantage. By consistently providing a higher level of customer service and better overall customer experience, a business can distance itself from the competition.
2. Offer unique products or services. There is a small hardware store that is always busy despite the fact that it is just down the street from a Home Depot. It studied the competition and offers products that the big box store doesn’t. The strategy has worked so well that the Home Depot will refer customers to the hardware store for items that it does not stock.
3. Tell the customer about advantages you offer. You know your business. You can see that you still have advantages to offer that the competition does not. In addition to customer service and the products and services you sell, what else really separates you from your competitors? Tell the customer.
4. Be active in the community. Be open to involvement with local charitable organizations. For example, sponsor a Little League team, or let the Girl Scouts or other groups sell cookies, candy bars or bake sale goods outside your store on a Saturday morning. This can extend outside of a local community setting depending on the company’s market – the scope of involvement can be local, national, even global.
5. Let happy customers be your advocates. Keep in touch with customers and engage them in helping to promote your business. Make use of any form of communication that is appropriate – mail, email, social media, etc.
6. Make use of a loyalty program. It could be a formal loyalty program that offers incentives for continuing to do business with you, like airlines and hotels offer. Or, here is where amazing customer service also comes into play. Make your customers feel so special they wouldn’t consider doing business with anyone else.
This is by no means a complete list of the strategies your business can use to compete. They are just a few low- or no-cost options that you can use to set your business apart in a competitive marketplace.