How can small businesses take on and beat Amazon?

by Darwin on February 10, 2016

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Starting off a retail business is exciting for entrepreneurs. However, one big challenge that every one of them must address is how to carve out a niche in the presence of big name players.  Companies like Amazon have unlimited budget and high brand awareness so how can you take them on with your tight budget and succeed?

Leveraging on size

Your business is small. There is no need to overblow its capacity. Embracing the nature of your business may be all you need to compete. Many customers today especially millennials are always looking to support a cause by getting involved which can include promoting and patronising a small business.

Leverage on existing customers

An existing customer will buy from you again 60-70% of the time. The number is as low as 5% for a new customer.  When this is combined with the fact that it costs 7 times more to get a new customer than to retain one, you will understand the importance of focusing on getting repeat business in the race to beat the large retailers.

Exceptional customer service

Many businesses are focused on keeping customers happy but smaller retailers should always look to go a step further. Research conducted by Harvard Business Review shows that customers who receive good customer service are likely to spend as much as 2 and a half times as much as a customer who doesn’t receive the same quality of service.

Set up shock absorbers

From comprehensive insurance plans to cash flow backup options, you need to ensure your business is adequately protected against unforeseen circumstances. Big retailers can recover from such situations. Smaller retailers that haven’t planned effectively could be driven to the brink of closure.


As a small business, one of the biggest advantages you have over bigger retailers is the ease of adaptation. You can take feedback on board and implement in a short time thereby satisfying your customers. For instance a small clothing business with customers requesting ability to test clothes on before purchase online can quickly set up an offline shop with samples of specific products in their online inventory. A bigger retailer will need to hold many consultations first to determine if it is beneficial to make the addition. To embrace adaptability however, small business need to avoid long binding contracts with suppliers.

Reward loyalty

Customers with big retailers are often left feeling underappreciated as loyalty schemes are either non-existent or reduced to very small discounts or small shopping vouchers. Capitalise on this and work in more juicy loyalty offers into the equation without jeopardising your profitability. Research has shown that 60% of shoppers have long-standing relationships with their local shops, with the average relationship lasting 10 years! Take advantage of that relationship and give back to the customer.


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