Small businesses worry that clients might judge them by their size, but being small is OK—as long as you make the most of what you have.
A big concern for many small business owners is that their size (or lack thereof) will inhibit their ability to land clients.
But in today’s environment, larger businesses are accustomed to working with small and even “boutique” firms. Experts say there is little need to worry—that professionalism and competency almost always trump size.
Rebecca Gubbels, a business development officer with the UMKC Small Business and Technology Development Center, likes to tell the story of a home-based entrepreneur who was giving a presentation to a potential client. The client asked where the business’s office was, should they have a question about the project. The business owner answered, “We have 27 area locations and will be happy to take a meeting at any one of those Panera stores.”
Not all small business owners can muster this kind of humor and improvisation. But Gubbels applauds their efforts.
“The business owner in that story was confident and also funny,” she said. “It’s OK not to take on the overhead of rental space if you don’t need space. Just deal with it with confidence and humor.”
In Gubbels’ experience, small business owners’ fears often have more to do with the individual than the competency of the business. If a business owner is worried about the company’s size, he or she may be putting that lens on the organization, she said.
“It’s almost never the market saying you don’t belong here,” she said. “They have to make sure they aren’t manifesting that themselves and creating what isn’t out there.”
John Kinskey, founder and president of AccessDirect Inc., which offers virtual receptionist services and related products, said he competes with companies that are 10 times larger than his, but he is able to tout the fact that he is hands-on.
“We are more personable and clients can call and talk to the same salesperson each time,” he said. “They can call and ask 20 questions, and we’ll answer them.”
If some clients don’t want to work with you simply because you’re too small, you probably don’t want to work with them anyway, he said.
“If they are buttoned-up and they want to pick you up and fly you in on their own jet, that’s
not where you are going to play,” he said.
Brad Lang, founder of the branding and communications agency Salient, said business owners worry that being small translates into less talent and more risk. It was a concern for him when he left an established agency and set out his own shingle this past year.
“I had an exceptionally high level of anxiety,” he said. “I wondered if we could convince prospects they can hire us and get the same level of work they think they will get from a bigger agency.”
Lang has since been hired by multiple clients who want to work with good talent that has a proven process and charges fees lower than a traditional advertising agency’s.
“Clients know that when they have hired a traditional agency before, anytime they walk in their office and look at the fancy conference room and junior kids running around, they are paying for all of it,” he said. “Companies are increasingly looking for cost efficiency.”
Particularly for service businesses like his, it is an advantage to be able to offer big-class talent at more competitive rates.
Making It Big
Still, entrepreneurs might not want to reveal that they are a one-man or two-woman show.
Elisa Waldman, a consultant with the Kansas Small Business Development Center at Johnson County Community College, said there are hosts of ways companies can create the appearance of a slightly larger group.
One of the first is to have a team of experts close at hand.
“If you are trying to look big for a big client, you do need to have some resources behind you,” she said. “They don’t need to be employees, but you need some structure and a team.”
Waldman recommends making sure the team is reliable. A business owner may want to pay a little more for them, check references and take time to assemble just the right group. Because a business’s reputation is on the line, she said, “You should be very detailed in your research about them and demanding of them.”
Lang said they are able to attract clients because the people he contracts with are all veteran professionals well-known for their work.
“We are big in talent,” he said. “We truly have more talent with our team than big agencies do because they couldn’t afford to pay them all on a staff level.”
Best Foot Forward
Another important thing to understand is small is not synonymous with unprofessional; one way to prove that is through marketing.
Gubbels is not a proponent of spending a lot of money on business cards and a website, but she said they have to be nice enough so the average person would look at them and think the organization is a legitimate business.
Having a nice-looking website and professional logos proves to larger clients that you’re just as detail-oriented as big competitors are, said Angela Hurt, CEO of Veracity Consulting.
She also recommends that small businesses showcase their best work. Ask your best clients if they would be willing to serve as a reference for you.
“Always be prepared with case studies or past performances,”
A Phone Call Away
Even if you work from an office in your home, it might be wise to invest in an outside address. Gubbels recommends trying a UPS Store’s mailbox service because they use street addresses instead of post office boxes. She also said it is good form to purchase a domain name so the company’s email addresses end in a business name instead of something like gmail.com or hotmail.com.
Kinskey found early on that a phone system can do a lot to create a professional image. Shortly after he had started his company, he called a friend whose receptionist was British. He hired her to record a greeting for his organization. “People thought we were international,” he said.
Also, if there is only one person in a company, a system can be created so all calls—sales, marketing, purchasing and accounting—have different voicemails, but are routed to one person. Though Kinskey has a larger team working with him now, all of his extensions used to go to him.
“I had multiple extensions, and they all came to me,” he said. “People would say, ‘John, I didn’t mean to bother you, I’m trying to reach billing,’ and I would just say, ‘It’s OK, I’ll take care of it.’”
Questions of Capacity
If a company’s owners have spent time and resources ensuring they can compete with larger businesses, it is important to make sure they really can. Waldman said this is one mistake that can create a bad reputation for other small businesses. Fortunately, it’s also easily avoidable.
“Although you want a customer to assume you are larger than you are, it is very important to set the scope of the relationship at the outset,” she said. “If not, you can end up with scope-creep. Instead of taking responsibility for the fact that the expectations were not realistic, if it gets away from you, they will assume it’s because you are small.”
She recommends always getting the scope of projects in writing and making sure the business is able to satisfy the requirements.
Entrepreneurs also need to invest in their own capacity, said Jason Lofton, the CEO of QTI, an Olathe-based contractor. Early on, his company bought a $5 million umbrella insurance policy—a big expense, one that some businesses might have avoided.
But having that coverage showed major clients like KCP&L that Lofton and his team were trustworthy. “Large companies are looking for certain things,” he said.
Play it smart, and they might just be looking for your company.