The key advantages small businesses have over large competitors
As an alternative invoice finance provider, MarketInvoice is privileged to work with many high-growth small and medium sized enterprises (SMEs). As a growing business ourselves we appreciate some of the advantages that come with being small, particularly when our most direct competitors are traditional invoice factoring and traditional financial institutions like banks. Just remember that 7% of businesses in the UK are high growth small enterprises, creating 60% of new jobs; here are some benefits of being a small business.
Flexible and quick to change
A small business has much better control over their output and interaction with clients than a bigger organisation. SMEs have the distinct advantage of being able to change plans or strategy much faster than larger competitors. A product can be brought to market more quickly when you have only a few people involved in its creation. A larger company must involve many people and processes in product development, slowing the process and giving you an advantage. A small business will typically be in a position to check products and correct any issues more quickly than a large business. This is good for crisis management and minimising risk, as well as for adapting your product according to feedback.
Personal connection to the customer
Being close to the customer is important for success in business, and a small business is frequently much closer to the customer than a large one. A small business can meet with the customer more frequently and develop more of a personal relationship than a large company. A large company has many layers and departments and often has procedures that prevent close contact with the customer. Big businesses frequently spend a fortune trying to replicate the intimate personal connections that smaller businesses tend to have with their customers. From our own experience we know that customers like to feel understood, valued and special, this is a lot easier to achieve as a smaller scale business. Customer complaints can be handled faster and on a more personal level in a small company, making long-term customer relations easier and more profitable. Social media is another great facilitator for engaging with clients; the need for expensive advertising is considerably reduced thanks to the digital revolution. When customers have that connection they start to like your brand and trust your service, choosing to use you more often and recommending you to others around them. This is when SMEs and start-ups can really begin to experience rapid growth in demand for their products and services.
Lean Organisation
By its nature a small business is very lean. There are fewer employees in a small organisation and also fewer layers of management. With fewer employees, a smaller company has less need to lay off people in hard times and can keep the business operating more efficiently. Having fewer layers of management makes decision times much quicker, allowing for flexibility and adaptability that a larger company does not have. Your lean structure means that every employee can be much closer to the business and the customer, allowing for both an understanding of how your company works and increased customer satisfaction.
Related articles
- Small businesses need to invoice correctly to avoid late payments (thestartupmag.com)
- 5 Cost Effective ways to market your business (thestartupmag.com)
- Q&A session with Bizoogo founder Erez Nounou (thestartupmag.com)
