Small businesses are often viewed as the small fish in a big pond. But they make up 99.7% of employers in the United States. They are the lifeblood of the country’s economy. As such, large corporations can learn so much from them.
According to the Small Business Administration (SBA), small businesses account for over one-third of known U.S. exporting value. In addition, they were responsible for more than 65% of new job creations in the country from 2000 to 2017.
Without them, the U.S. economy wouldn’t be thriving as it is doing now. Many companies might’ve shut down due to the pandemic, but many small businesses have emerged and endured. As such, they can change lives and the world, making both better.
These are the ways small businesses can create a brighter future for us:
1. Agile Management
One advantage small businesses have over big ones is their more agile approach to management. Since they’re not blocked by red tape, small businesses make decisions faster. As such, they can test new technologies, processes, systems, and marketing tactics quicker.
This makes them lead innovations in the industry. They can start trends that big businesses will follow. For example, if they want to encourage consumers to make greener choices, they would use sustainable materials for their packaging.
The small business’s customer will then talk about the brand’s eco-consciousness. It will eventually catch the attention of big businesses, which will adopt the same practice. They may do it at a slower pace because of their longer decision-making processes, but they’ll get there all the same.
2. Spreading Awareness on Social Issues
Many small businesses use social issues to reap marketing benefits. This approach is called cause branding or cause marketing. It is the act of supporting a cause and getting marketing benefits in turn. Businesses use this to encourage their customers to support their brand while giving back to charity.
Customers are willing to pay more if the business supports a cause. Thus, cause branding can help small businesses gain momentum. It also allows them to engage with their customers better. For example, if they organize a donation drive or a marathon to benefit a specific organization, the small business gets the opportunity to interact with their customers face-to-face. This humanizes the business, which lets them forge a stronger connection with their customers.
3. Creating a More Diverse Workforce
Big companies see small businesses as a competitor when it comes to talent. Though big companies have a larger pool of talent, small businesses have a more diverse workforce. They blend different cultures and backgrounds in their organization. This enables them to create better work-life integration programs and marketing strategies.
Workplace diversity allows companies to stay relevant in the ever-changing market. It improves their ability to compete globally and boost their brand. Indeed, if a business wants to target an international market, what better way to do that than get insight from a person raised overseas? Employees of different genders, ages, abilities, and racial backgrounds give companies an edge, too. It makes the organization develop cultural diversity, openness, and increased empathy.
4. Using Sustainable Processes
Small businesses are the trendsetters when it comes to sustainability. Aside from often using recyclable packaging, their cost reduction strategies also decrease their carbon footprint. For example, a small business is more likely to support local vendors, like farmers or artisans. This allows them to save on shipping costs because they won’t be relying on importation. In turn, transporting their goods consumes less fuel and releases less emission.
In addition, small businesses are more likely to buy office furnishing and equipment secondhand. As a result, creating their office space can take less energy and fewer raw materials. This reduces the number of discarded furniture and equipment dumped into landfills.
5. Adapting to Changing Economic Climates Fast
It was surprising that many big companies closed down during the pandemic. All along, we assumed that they were stable enough to beat the odds, but not. Meanwhile, small businesses stood strong because they quickly adapted to the changing economic climate.
Though not every single small business survived, many of them are still standing, and many more are just getting started. Their adaptability is due to their customer-oriented culture, which allows them to understand the needs of their community. This makes them gain loyal customers better than big companies. These customers help them stay afloat during a crisis, letting them retain their employees instead of laying them off.
Small businesses prove that you don’t need to be a big fish in a small pond to make an impact. As long as your values and mission help your community, you’re already making the change the world needs to see.