Levelling the playing field – How small suppliers can compete with larger brands
The advent of the internet has brought about great changes for small businesses. Combined with the instant benefits offered by social media, retail start-ups need no longer be held at the behest of larger firms to get their products in front of customers.
With stories recently making the headlines of small firms facing supply chain bullying from big companies such as WH Smiths, Debenhams and John Lewis, it seems now more than ever the internet is playing a pivotal role in helping entrepreneurial small companies rise up and compete with the big players in their industry.
Currently, large brands can demand 'pay and stay' cash from suppliers, demanding financial investment to remain a supplier. This has been noted in cases such as newsagents WH Smiths requiring publishers to pay a 'promotion fee' in addition to the cut they take from the cover price of a magazine, for the privilege of being stocked in store, a situation brought to light recently by small history publication 'After the Battle'.
The government has taken an interest and with groups such as the Federation of Small Businesses (FSB) standing up to fight back, it seems that with time the playing field may become fairer for firms big and small.
A better way for small business
The internet offers a viable alternative to many businesses that don't wish to become embroiled in potential cash flow problems, payment delays or the huge fees often exacted when dealing with large retail brands.
Inspiring stories such as that of seventeen year old Taylor Dow in Australia only go to prove how a good idea and a little business sense can turn individuals into formidable companies - with the help of the internet, of course. Dow created his own range of weight loss tea and started selling it online in his spare time; he now has more than 8,500 customers around the world and feels that the online nature of his business, BodyTea, has been the key to its success.
Online marketplaces such as eBay, Amazon, Etsy and Folksy offer a viable alternative to those not wishing to set up their own website. Traders are able to benefit from the added exposure and traffic offered by these well-known platforms.
One such company is that owned by Gill and John Hewitt. The couple started selling household appliances on eBay in 2005. Their company Bamford Trading now also trades through Amazon and its own website, turning over around £1.5 million a year.
5 Top Tips for levying the internet for maximum greatness
1. Research your customers
Know your target market and if you're using a marketplace then ensure it's one that reaches this target audience most effectively. For example, eBay is often used by customers hunting for bargains so it's great for household items, whereas Etsy offers a marketplace for unique handmade gifts or materials. Folksy is similar but aimed more at UK sellers. While Amazon customers may still be after a good deal, they are often more professional than eBay customers. Amazon is ideal for selling books, DVDs and games.
If you plan to launch your own website then knowing your target market is still key. From products to design and usability, doing research on this and getting to know your customers will help no end.
2. Promote yourself
Make sure you are up on the digital marketing trends and set up relevant social media accounts for your company. Self-promotion is vital if you decide not to lean on a big brand. Keep on top of the latest SEO, PPC and marketing practices to drive traffic to your site and maximise visibility. Don't be shy about making sure the internet world knows just how great your products are.
3. Have great product photos
When buying online, customers are reliant on your photographs to see exactly what they are buying, so make sure your pictures are the best they can be. If you struggle with things like lighting then consider having some professional product shots taken to ensure they are most effective. If you are re-selling products, rather than fabricating them yourself, then check with your manufacturer - they may have smart ready-made product shots available for your use, saving you the bother.
4. Pay attention to customer service
Despite not being face-to-face, there's no reason why this means customer service should be any less than excellent. Feedback on selling platforms like eBay is really important for promoting you to future customers, and a feedback score of less than 90 per cent can hurt your business. Good customer service means excellent communication, prompt delivery and always fulfilling promises.
5. Look carefully at the costs
Make sure you understand exactly what your outgoing costs and overheads will be; this includes selling fees, transaction fees, product cost and postage. Look at what your competitors are offering and research their prices, postage charges etc. Don't try to be the cheapest necessarily, because often quality will speak for itself over price, but it pays to know the market and where you sit.
Knowing and utilising these five tips should ensure every business, no matter how small, can compete with even the biggest sellers.