Those who are regular readers of this blog know that I am a big supporter of small businesses many of whom feel that they are at a disadvantage when competing with large corporations. I firmly believe that not only can small businesses compete with their larger rivals,but can beat them at their own game. We showed some of the techniques you can use to beat large competitors in earlier post.
In my view large corporations gain advantage against smaller rivals with economies of scale and having better access to capital and business tools. However, the Internet is changing the playing field in favor of small business owners. SohoOS is one promising start-up that aims to level the playing field in the area of business tools. SohoOS shares our vision of helping small business owners effectively compete with and beat their larger rivals who hold unfair advantage.
One of the greatest things about the Internet must be the availability of so much information for free. However, it’s also a public forum where anyone can publish so-called resources without a system of peer review. If you’re basing your business decisions on information gathered from the Internet, you need to make sure the sources are valid and reliable.
Wikipedia is a prime example of user-generated content that isn’t always reliable. However, it has a system of citation or reference that identifies the source so that users can follow the trail of information. In Wikipedia, citations are contained in footnotes (links at the bottom of the page), although they also sometimes appear in the main article of the body.
I am always on the lookout for lessons to be learned from my own experience as a customer. I believe small business owners can learn a lot about management and customer service by putting themselves in the shoes of customers. I was presented with such an opportunity when we visited Olive Garden restaurant in Auburn Hills, Michigan over the weekend. This was a special treat from my daughters on Father’s Day.
While I have always liked Olive Garden’s delicious food particularly the soups and salad my experience on this day left a lot to be desired from such a reputable national restaurant. Here is what happened:
The scenario may look familiar to many small business owners. You are doing a brisk business with loyal customer base. The sales are growing steadily. You are making decent profit. The same holds true for other competitors in the neighborhood. The existing customers in the town are divided between your and other businesses. In short, equilibrium has been established amongst existing businesses.
And then, a new competitor decides to get a piece of the action. Suddenly, everything changes. The new competitor tries to grab customers with lower price and increased marketing. The existing ones try to hold onto their customers. Employees will leave for bigger opportunities. It’s as if someone threw a stone in the calm waters causing ripples everywhere in the neighborhood.
The initial reaction for many existing business owners may be to counter the new competitor with force right away to ensure these ripples do not cause significant damage to your boat. However, this may be a mistake. The best strategy may be to watch and plan for the future before taking radical steps. In particular, it is important NOT to do the following right away.
Trivia question: Name the franchise with most number of locations in the world. If you answered McDonald’s you are wrong. The new king of the franchise world is Subway. It surpassed McDonald’s in 2011 with 33,949 worldwide locations compared to Mickey D’s 32,737. The franchise that started with mere $1,000 by Fred DeLuca in 1965 has seen phenomenal growth in the last 10 years.
Subway has been able to grow consistently year after year by following principles that can be applied to any small business. We have studied and analyzed those principles and present them below for small business owners to apply to grow their business in a similar fashion.
Unless you have been hiding in a cave for the last couple of years you know Greece is on the verge of economic collapse on the scale not seen before. The unemployment rate is a staggering 22% and they are expected to default on their loans unless they receive yet another round of financial help from their neighbors and EU partners.
While it may be tempting to think of Greek situation as unique, it is not far-fetched to think of an analogous scenario for small businesses. After all, as we show below the reasons behind Greek crisis are prevalent in many of the businesses – both large and small. That’s why Greek crisis holds important lessons for business owners in how not to get into the financial disaster. Below is our attempt to explore reasons behind Greece’s failure and how they apply to small business owners.