12/5/2014
If you’re the smaller guy in the locker room of U.S. manufacturing, you have nothing to be ashamed about. In fact, you should embrace your size because bigger doesn’t necessarily mean better in the world of manufacturing.
Sometimes, larger companies intimidate their smaller counterparts. Because bigger companies have more resources, it can become discouraging trying to compete with them. They’re typically better known, boast a stronger customer base and have more money to invest in things like advertising and new product development. You’ve probably thought to yourself, “I can be just like them if I had their budget…”
Don't despair! Today’s global economy is constantly evolving, and consumer attitudes are changing. Here are 5 ways that smaller Michigan manufacturers can stay toe to toe with the big guys in town:
1) Proactively Highlight your Size: Studies are showing that consumers and businesses are favoring smaller, local companies. We’re a nation that likes to root for the underdog. A recent survey by Public Affairs Pulse found that “two-thirds of respondents said they prefer to shop at small businesses, even if it means paying more.” The same study found that small businesses have a 90% favorable rating while larger companies had a 61% rating. Even U.S. Internet users prefer smaller companies: they cited supporting the local economy and personal service as the top two considerations when shopping online.
Key takeaway – don’t run away from your size – own it!
2) Speaking of the Internet...: You don’t need to have a huge budget in order to have an effective website. With the right website strategy supported by SEO and social media, you can get found by your target audience when they’re researching for products and solutions.
Key takeaway – improve your website and online marketing tactics in 2015.
3) Stay Current with Technology: Many smaller manufacturers disregard technological advancements because they believe it will be too costly or difficult for them to adopt. The reality is, there have been many recent breakthroughs in technology, enabling equipment and processes to become more affordable. For example, additive manufacturing is anticipated to become more common and cost-effective for smaller businesses. Remember, the VCR and the microwave are just two examples of products that were initially released as costly luxury items.
Key takeaway – do your research and be on the lookout for advancements you can adapt for your business.
4) Highlight Quality as Opposed to Price: Candidly, we can’t always compete with bigger manufacturers or foreign competitors on price. They have the economies of scale that we just don’t. Nonetheless, quality is making a comeback. You have the ability to trump bigger companies on things like customer service and the reliability of your products. Obtaining quality management systems or training employees through proven methodologies such as six sigma can help you provide better quality to your customers.
Key takeaway – the price of your products and services doesn't have to be a deal-breaker. Emphasize the value your company brings to your target audience.
5) Target International Markets: Even the biggest companies aren’t everywhere. Did you know that 95 percent of the world’s customers live outside the U.S.? Exporting is becoming a viable option for small manufacturers to increase sales and diversify their portfolio.
Key takeaway – don’t limit your products and services to a 50 mile radius. You have the potential to increase sales overseas.
Let’s be clear: growth is something that every small manufacturer should strive for. Increasing profitability and creating new jobs for our economy are good things. However, it’s simply not in the cards for all of us to become large multi-million dollar corporations… and there’s nothing wrong with that. Embrace your size and remember – you can compete with the bigger guys!
Since 1991, MMTC has assisted Michigan’s small and medium-sized businesses compete and grow. Through personalized services fitted to meet the needs of clients, we develop more effective business leaders, drive product and process innovation, promote company-wide operational excellence and foster creative strategies for business growth and greater profitability. Find us at www.mmtc.org. (Image source.)
Categories: growth,
U.S. Manufacturing