How Small Businesses Can Use Customer Relationships To Compete With Big Boxes

 Is your competition a big box chain such as Wal-Mart or Best Buy?

You're worried because they can beat you on price, by buying in volume. How can you compete with that?

If you can't compete on price, compete by building more effective relationships with your customers.

Mark Riffey, at Business Is Personal, has a great post about a local arts and crafts business owner who knows he can't compete with Wal-Mart's prices. Mark quotes owner Rick Latta who says:

“I can’t compete with Wal-Mart prices, but Wal-Mart doesn’t walk customers through projects, give them ideas, teach them tricks or have a studio with tools where people can come and work and ask questions,” he said.

Treat your customers the same way your parents taught you, at a young age, to treat your friends. Show them respect, say "Please" and "thank you." When they leave your business, smile and say "Thank you," then say, "Tell your friends about us." If you ask, more of them will than if you don't ask.

Listen to them. If you own a clothing store, do you have customers looking for a certain accessory, style, or piece of clothing that you don't have? Can you special order it? If you own a book store, ask your best customer what her favorite book was as a child. Does she still have it? If not, use Amazon.com Marketplace to buy a used copy in good condition. Then present it to her. Become known for your ability to special order merchandise. If Staples Office Supplies' slogan is "Yea, we got that!" Then yours could be, "Yea, we can order that!"

Ask your regular customers some variation of this question, "What's the one piece of clothing/jewelry/accessory/book, etc. you don't have, but would like to?" Then see if you can locate it. Contact the customer and say, "Mrs Smith, I was just talking with one of my suppliers and found the ____ you mentioned to me last week.

Beat the Big Boxes on their customer service policies. Stop negative word of mouth in its tracks by exceeding the customer's expectations when something goes wrong.

Be active in your community. Volunteer your time. Join Rotary, Kiwanis, or the American Cancer Society. Support your local schools.

If you compete with the big boxes, don't shop there except to learn about their prices and customer service. Do business with your fellow small business owners. Perhaps they'll do business with you.

Build mailing lists to e-mail your customers about new merchandise, sales, etc. Consider starting a business blog.

Ask you employees for other ways to "beat the big boxes."

Go get 'em!

Regards,

Glenn

PS: If you would like to read more about how to beat the big boxes, check out Mark's blog (see the link above). He's written extensivesly (and very well, I think) on the topic.