Small business is – quite frankly – big business. The Small Business Administration identified that there are more than 28.2 million businesses operating in the United States as of March 2014, with about 63% of new jobs being created from small businesses between 1993 and mid 2013. Of these 28.2 million businesses, most are “self-employed” – making up about 3/4 of the U.S.’s total businesses. Meanwhile, approximately half of small businesses survive five years or more, many of which make up your local coffee shops, favorite local boutiques, preferred chiropractor or local pet shop.
When you consider how many small businesses surround you in your everyday lives, it is impressive to think about the amount of time, commitment and labor these hard working individuals contribute to make their businesses both come to life and stay alive. Yet, many Americans frequent chain stores without considering their local merchant or other small business options. Whether it’s filling a prescription at a local pharmacy vs. Walgreens or picking up eggs and milk at a local corner store vs. your nearest Walmart, small businesses are too often overlooked for all the wrong reasons. Customers assume that pricing will automatically be higher at a small business vs. a corporate owned store, as well as they dismiss the perks that many small businesses offer such as customer care, inventory assortment and community support. However, did you know that many of these misconceptions about small businesses are just that… misconceptions? Here’s why:
1. Stores do not control pricing of most products. Vendors do. When you consider brand names like Under Armour, Melissa & Doug children’s products or Fossil, you have to also consider that the prices identified on them for sale are identified by the vendor – not the store. With some exceptions, stores primarily have no control over a product price but rather are provided a MSRP (Manufactured Suggested Retail Price) that tells them the price the product should be sold at. Over time, if the product doesn’t sell or a store has a promotional event taking place, this price may be lowered. But generally speaking, vendors want their products sold at their suggested rate, therefore retailers are not encouraged to lower them unless it’s discussed in advance – such as stores like Nordstrom do for their famous Anniversary Sale. Many small merchants, as well, also offer discounted items for special occasions – therefore not making this exclusive to big box stores.
2. Inventory is not always more easily available at big box stores. Smaller merchants have the same access to vendors as big box stores do, therefore if you need an item and it’s not available in their store, it’s likely they can get in touch with the vendor right away and try and order it for you right away. Of course, there are always exceptions, but most small store owners are eager to go above and beyond in their customer service support and this is just one way they can do so for their customers.
3. Customer service is more personalized, hands-on and noteworthy from smaller businesses. Again, there are exceptions to every rule, but generally speaking you should expect that a smaller business will deliver stronger customer service. Their personal commitment to their business certainly helps in these efforts, but even from their collective team – no matter how small or large it is – typically stronger customer care is experienced. Among the reasons why is that they have a more hands-on role within the company, therefore building a stronger sense of care for the job they do. Additionally, smaller companies are more flexible in their customer support – with a willingness to bend rules if necessary (such as alter a return policy) or deliver VIP treatment when least expected (such as home delivery for a customer during a rain storm). While every business is different, what also makes customer care among small businesses more valuable is just that – being different.
4. Product diversity and options are often greater at small businesses vs. chain stores. Sure, a big box merchant may have a larger footprint in your local community, but that doesn’t mean they have more variety to offer you. When you walk into a chain store, you know exactly what you will find. However, when you walk into a local business, you are often surprised by the inventory options. This is to a customer’s advantage and is among the many reasons to frequent your local stores more often. And remember – just because a big box store is just that… bigger… doesn’t mean they have more to offer. The assortment of inventory at big box store are just deeper, not more diverse.
5. Local business owners are more likely to give back to your community. Beyond actual dollars being kept within your local community – which is significantly higher when dollars are spent at a local business vs. corporate one – small business owners are also more likely to “do good” for your community, as well. Small businesses deliver community character and economic advantages to the town they are positioned in, but also strengthen partnerships among neighbors, residents, other small business owners, community leaders and even schools by offering social and economic relationships. Many also support local causes, creating even more good within a community.
Another interesting point to consider is that small businesses do not always stay small – such as Ben & Jerry’s or Ralph Lauren. Both began as just dreams filled with a tremendous amount of hard work, long days and tired nights. Today, they are among the most recognized brands in our country. Yet while most small business owners will not see this type of growth, their value to our economy and more specifically – your local economy – are just as important. There’s even a day to celebrate them – Small Business Saturday – which takes place the Saturday following Thanksgiving, anchored between Black Friday and Cyber Monday.
Small Business Saturday, any Saturday or any other day in between, supporting small businesses deserves to be part of your everyday routine.
Article by Nicole Leinbach Reyhle, the Author of Retail 101: The Guide to Managing and Marketing Your Retail Business, as well as the Founder of Retail Minded and the Independent Retailer Conference.