If you were to ask someone on the street “What would your rather own, a small company or a big company?”, the typical answer would probably be “A big company”. Smaller companies have a lot of advantages that are often overlooked. Besides being easier to run, they can be more innovative, and can respond to market demands more quickly.
While reading an article posted on Legal Zoom called “4 Critical Differences Between Large Companies and Small Ones” they talk about the differences in employee types between the two environments. It was disclosed that smaller companies have a more diverse personality types among their staff, where larger companies tend to sift through all of the variety and keep people who are perfectly content to follow procedures and conform to their guidelines. Because of this, the larger companies are most likely losing feedback from those that interact directly with their market every day. Small company owners have the luxury of employing people who do not mind providing market feedback and can be sure they are investing in the right innovations and doing the right things.
Change to meet demand is not like moving mountains as it is in a larger company. It can be as simple as a Store Manager bringing an idea to an owner who decides the suggestion makes sense, where the budget is simply adjusted to accommodate it.
Small stores also have the ability to try different and offbeat things that larger companies would hesitate to do because of the complexity in doing something outside of the norm in so many stores. Large companies would have a lot more investment and coordination effort involved, where the payoff may just may not be there for them.
Small store owners have more flexibility in conforming to market demands. It is easier to define their market than a larger company with stores in multiple markets, or even multiple states. They know what their customers like and don’t like, because with proper tools patterns of purchase are easier to read.
They are able to provide that personalized, one on one service that larger companies tend to lose. An owner may even know several of their customer’s names. They are able to do business the way people want to do business.
In smaller companies, customers don’t mind making suggestions for improvement because they know there are not organizational tiers for the suggestion to pass through for approval. In larger chains that information is often kept in pocket. The general feeling is, “Why bother?”.
It is very hard to compete with innovation and market responsiveness. These are two key weapons small companies have to combat the larger companies. These two areas are a larger company’s weakest links.