Competitive Advantages Small Businesses Have Over Big Companies

Every person can list off the names of some key large companies that are seemingly dominating the industry. These corporations appear successful and even sometimes as though they hold a monopoly in their field. It is true that large companies and corporations have vast resources, the benefit of a wide reach, and a huge resource of employees to utilize. They are often talked about and praised for their leadership capabilities and success. However, success is not simply measured by the standards that large companies create. Small companies, though often less talked about, are excelling in their own unique way. They may be succeeding behind the scenes in comparison to giant companies, but small businesses should certainly not be underestimated. In fact, there are significant advantages small companies carry over their larger counterparts.

Ease of Adaptation

While larger companies may have more experience and, perhaps more importantly, more revenue, there are some ways where they can’t always compete with smaller businesses. When it comes to targeted strategies, smaller companies can more easily pivot and change up campaigns and procedures, without so much red tape to wade through. Innovation is applauded, rather than seen as a risk, and young entrepreneurs often emerge with a dozen new skills that they’ve learned in the process.

Dylan Fox, Founder & CEO, AssemblyAI

Focus on the Target Audience 

Since local businesses have smaller target audiences than larger businesses and corporations, it’s a lot easier for them to identify and focus on serving their target audience. While larger businesses have a larger target audience, this allows more room for variety within this audience, making it a bit more difficult to pin down all of the characteristics within this group. 

Joaquín Roca, CEO, Minerva

Deeper Development for Employees

Small businesses can focus on the personal and career development of each employee. Fewer employees also means leaders are able to address questions and concerns on an individual level. Small businesses can also empower their employees by encouraging them to give input on business decisions.

Carrie Derocher, CMO, TextSanity

Increased Humanness

With a small company, there can be a stronger perception of humanness. Small companies can connect with consumers on a deeper level by coming across more person-to-person. This is particularly true on social media when communicating through customer service, but also extends to overall marketing of your company. Consumers can see the faces behind the company which makes them feel more seen and aware. A method I have personally used in my business is being clear about who Selfless by Hyram is and what it stands for. Large companies that are not open about the people behind the work cannot compete with the advantage that humanness offers. 

Hyram Yarbro, Founder, Selfless by Hyram

Prioritized Customer Service

One important factor of any success story is providing an unparalleled customer experience. And sometimes, when your business grows too quickly, you can lose sight of that. But, small business owners HAVE to please their customers. They’re not just another number, but the source of additional sales, product review writers and, perhaps most importantly, other customer referrals.

Travis Killian, Owner and CEO, Everlasting Comfort

Stability of Branding

Small companies have an advantage because they have the choice of how they want to brand their product and mission statement, ranging to every detail such as brand voice and general tone of response in customer communication. There is a pared-down simplicity to the method of branding for small companies, not to mention that fewer employees additionally means more consistency of branding as there is less likelihood of a misrepresentation of voice. 

Jeff Henretig, President, Apothecanna

Strong Work Dynamic

Because small companies have fewer employees than companies with a massive workforce, those working together know each other well. These employees of small companies bond together quickly over their shared goal, and through working together in cohesion they are able to accomplish much more. Plus, workers who have community with each other build camaraderie which in turn keeps company morale high. 

Charlie McKenna, Chef & Founder, Lillie’s Q

Self-Starter Environment

Employees who work at small companies have the satisfaction of watching their workplace build itself from the ground up. There is a wonderful feeling of usefulness when you contribute to something greater than yourself. Employees in small companies who do experience the company from its origins through to its successes feel deeply entwined into the company and its achievements, since many of the workers will have stayed in their position throughout the major growth. Small company employees get to literally watch their company progress from the bottom to the top which is truly something special.

Jessica Herrin, Founder and Owner, Stella and Dot

Increased Flexibility

Small companies tend to suffer from less bureaucracy and have more flexibility. This is important because small businesses need to be able to pivot or implement changes quickly. Things like approval processes typically do not take as long in a small business which helps companies grow and evolve faster when needed.

Benjamin Smith, Founder, Disco

Small Business Identity

One of our core reasons for being is that some of the industry incumbents fell out of touch with their customers and greater industry trends. Because they are so large, every aspect of their customer experience is - and feels - large. We take the opposite approach - we’re constantly thinking about how we keep our spirit ‘small business’ oriented, having regular ongoing conversations with our customers, developing products based on their unmet needs, and speaking to them as they should - like humans with unique needs. 

Robbie Salter, Co-Founder, Jupiter

Perseverance Through Trial and Error

Small businesses possess a driving force that many major corporations have forgotten about these days. When you’re first starting out, it really is a lot of trial and error, mixed with accepting that you’ll have to go back to the drawing board - again. However, this builds integrity, and it creates a sense of… well, “redemption” that can’t really be experienced in a large company. Once Plan A doesn’t work, it makes it feel even better when Plan B or Plan C are successful. 

Ryan Rottman, Co-Founder and CEO, OSDB

Accelerated Leadership

Small companies’ employees are at a competitive advantage due to the likelihood of a rapid advancement from a lower position to a higher one. At large companies, and especially at mega corporations, employees often remain in one position without advancement or recognition. They are essentially just another “cog in the wheel.” Frustration over a sense of stagnancy in one’s job is a major cause of workplace unhappiness. On the other hand, workers of small companies are known by those in leadership positions, recognized for their hard work, and the first choice of consideration for a higher role. 

Jacques-Edouard Sabatier, Co-Founder and CEO, JOW

Shorter Decision-Making Time 

One advantage small businesses have over large businesses is the ability to make quicker decisions. Since there are less people in the organization, there is less input to consider. Fewer regulations also stand in the way of decision-making, which means small businesses can be quick on the draw with process and product innovation.

Rym Selmi, Founder, MiiRO