In many parts of the world, small businesses play a critical role in the economy. While the big conglomerates get all of the attention thanks to their big marketing budgets and dedicated PR departments, small business owners provide quality employment for millions of people, add value to the economy, and offer unique and useful products and services to their customers.
In fact, today, many more people either want or plan to set up their own business at some point in their life. Millions more are already making this a reality by setting up a “side hustle”, a business that they run alongside a full-time job.
This culture of small business has always been present in some cultures. In the United States, it is often referred to as the “backbone of the economy”, while here in the UK, we often wear the title of “a nation of shopkeepers” with pride.
The internet, liberal business regulation, and a thriving economy have all made it incredibly simple to start and run a firm of your own. Unfortunately, this is a double-edged sword as it also means that your competitors also have it easy.
This means that almost every market is more crowded than it has ever been, so business owners are having to work harder to ensure their company remains competitive. If you are finding yourself losing clients to others in your industry, then you may want to consider these ways to help win some more clients.
Competing on Price
This is probably the easiest way to compete against your rivals. It requires very little work to do and can be very effective in getting new customers to come through your door.
Supermarkets in the UK often get into “price wars” where they all keep slashing their prices to undercut the other. This is most commonly seen with petrol as it also often helps the stores attract positive news headlines.
You don’t just have to cut your prices to compete on price. You can use loyalty schemes and other promotions to make your product or service more attractive. This is a technique used by Boots, Tesco, and Sainsbury’s.
You can also use one-time offers to help attract new customers. This is something that is regularly seen in the iGaming industry with most online bookmakers offering free bets and other similar promotions to try to stand out from their competitors.
However, competing on price doesn’t come without its drawbacks. It can draw you and your competitors into a “race to the bottom” which sees you all slash your prices lower and lower until none of you makes a profit.
Competing on Quality
Another option is to compete on quality. This involves having a product or service that is (at least subjectively) better than your competition. This can be achieved by using better materials, a personal service, or bespoke designs.
Competing on quality usually means that you can also charge higher prices than your rivals. In fact, charging higher prices can make your product more attractive as the large price tag is often perceived by customers as meaning it is also a better quality product.
Companies like Rolex, Mercedes, and Apple all use this approach to stand out from their competitors.
However, it is important to ensure that the quality you talk about is the quality you actually offer. Otherwise, you’ll be left with a lot of angry customers.
Competing on Convenience
Most of the larger out-of-town supermarkets offer low prices, but they’re not always close by or easy to get to. So when you get back from work and release you’ve run out of milk, you often don’t want to drive 8 miles down the road to Morrisons.
That’s where other businesses can compete on convenience. You offer time savings to your customers by being closer, easier to buy from, or have faster delivery.
Businesses that offer convenience can also charge higher prices. Milk in a corner shop or a Tesco Express is a little more expensive than a large ASDA store, but it takes 2 minutes to walk to instead of a 15-minute drive. You’d almost certainly spend more on fuel to drive for the cheaper price.
With these different techniques, it’s possible to find a way to stand out from the crowd and compete with your rivals, so you don’t have to keep losing customers.