Why Flexibility Is Key to Small Business Success
From printing to marketing consulting, a multitude of small businesses are meeting the needs of larger businesses and corporations. Every niche faces its own set of challenges, but small businesses have a lot of commonalities.
Flexibility is what counts. Whether that means changing your business model, lowering prices or outsourcing work to lower-cost offshore talent, today's small businesses must be savvy to survive.
Competition and the freelance factor
Freelance talent is a major competitor for established small businesses. When professionals find themselves out of work, many are freelancing. The added competition, which is often lower cost, poses a challenge for established boutique firms.
"Of course we're facing increased competition," says Matt Michel, CEO of Service Nation. "Every successful business faces increased competition over time. Competition keeps us awake at night. It keeps us from becoming complacent. It spurs us on to outpace them."
"Despite the economy, people are still willing to pay for quality," says Heather Curtis, marketing manager for TheeDesign Studios. In other words, small businesses bringing a quality product or service to the table won't be stifled by freelance competition, but encouraged by it.
Onshore and offshore outsourcing
"Companies can no longer afford to have full time in-house developers and programmers, so they reach out to us for those services," says Curtis. For boutique firms, this trend is a plus, as corporations gladly enlist smaller firms to help with non-critical business components.
Outsourcing can also mean more affordable labor for some businesses.
"We've seen a significant increase in our business because of our global hiring in the Philippines," says Sander Daniels, co-founder of Thumbtack.com. "We have a team of 150 hardworking, talented people who have allowed our business to thrive."
On the flip side, however, U.S.-based small businesses could see work decrease if their niche is a service that's easily provided by offshore workers.
Pricing is another area with two sides to its story. During periods of economic turmoil, some businesses may drastically drop prices just to make it, while others are making a killing.
Individual complications are dependent on the niche market they serve. For instance, small businesses serving core business components could suffer as corporations seek full-time staffers to meet those needs. But those in specific target markets are more likely to thrive during periods of global economic strife.
"Over the last year, we've actually been able to increase prices on our site," says Daniels of Thumbtack. "Small businesses are always looking for more clients, and we can bring that to them very affordably. Businesses are willing, even eager, to pay for new clients."
This speaks to Thumbtack's business model: serving new leads to small businesses, especially those desperate to secure new business.
"As our portfolio has expanded, we have been able to successfully raise our price point," Curtis says.
Small businesses that help other business owners to thrive may see an uptick in revenues as those other owners seek any opportunity to increase revenues.
Shifting the focus
If times are tough, some small-business owners suggest a refocusing.
"We have completely changed the way we market ourselves, from strictly being a PR firm to more of a marketing agency," says Becky Boyd, VP of MediaFirst. "We needed to do this because of the economy. Companies are not hiring PR agencies anymore. But they will outsource to a marketing agency. We have also had to lower our prices to get clients."
Again, adapting to market demands is the key to success.
The bottom line
When a business is flexible, it's possible to weather these challenges.
Some small-business owners have succeeded because of the outsourcing trend. Others have increased profits by outsourcing some tasks to offshore talent.
Price points are in constant flux, as some niche markets are in high demand and can realistically raise prices. Others must lower their price points to attract new clients.
At the end of the day, it's flexibility that allows a business to completely shift its core focus to accommodate market demands.
Angela Stringfellow is a PR and marcomm consultant and social media strategist for businesses. She blogs for Contently.
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