How to Compete with Big Box Stores

It’s many small business owner’s worst nightmare. Imagine a Home Depot opening across the street from your family’s neighborhood hardware store or a Petsmart moving in a block away from your small tropical fish supply shop. You’re way out of your league, right? Not so fast. Although large retailers have a lot going for them—big parking lots, wide product selection, vast inventories—they don’t have every advantage. With the right approach, you can gain a competitive advantage and successfully compete with big box stores. Here are a few ways to keep your edge—and thrive.

How to Compete with Big Box Stores

Size Matters

And bigger isn’t always better. How many times have you gone to a big box store out of convenience to get one or two items? Chances are between parking and walking around the warehouse-sized interior, you wasted a lot of your valuable time.

As the neighborhood shop, though, you offer your customers a curated selection of items in a more compact setting that they can navigate quickly. You just need to learn to sell the advantages of that convenience. For instance, if your research shows your customers want to get in and out of your store quickly, promote in-and-out shopping in your advertising, display the most frequently purchased items near the front door and have a few 10-minute parking spaces directly in front of your store. Time-pressed customers will notice the efforts you make to make their shopping experience quick and easy—and they’ll remember you next time.

Tap into the Love of Local

According to a study by American Express, 93 percent of Americans believe it’s important to support the local small businesses that they value in their community, and 73 percent consciously shop at small businesses in their community to help keep them afloat.

This shop local movement has gained traction in communities across the country in recent years, and it’s impacting small business’ bottom lines. A study by the Institute for Local Self-Reliance revealed that half of businesses reported that shop local campaigns had helped them generate new customers.

You can leverage this momentum by participating in a shop local campaign in your own community. You’ll find resources, tips and tools to help you get started here.

Zero in on Your Customers’ Wants

Instead of trying to be lots of things to lots of people—as big box stores often do—focus on being exactly what your own customers need and want. As a small business, you’re nimble enough to add new products and make changes whenever you see fit—something that can impede the big box store down the street.

The first step is listening to your customers to learn what’s important to them and paying attention to trends in the neighborhood to discover what’s hot.

For instance, if healthy lifestyles are all the rage in your locale, try offering organic pet food in your pet shop. If recycling is important to your customers, offer branded reusable shopping bags at your register. If your customers value form over function, try adding some high-style items to your product mix. If your customers can’t make it in because you close before they get out of work, adjust your hours. You get the idea. They ask, and they receive.

Get Personal

Small businesses offer a sense of community that big box stores just can’t match. Take the time to learn the names of your regular customers and what they like, and make personalized recommendations when they come to your business.

For instance, if you have a kitchen supply boutique and know your customer enjoys baking, show her the latest mixing gadget or baking pan the next time she stops by. If a regular at your pet shop likes tropical fish, be sure to demonstrate the latest pump or water testing system for him when you see him. Your customers will be both flattered and impressed by your expertise and customer service.

Also, offer classes related to your merchandise or host open houses—complete with refreshments—to celebrate new product launches, anniversaries or other special events. The more you do so, the greater the opportunity for you to foster a sense of community—and grow your bottom line.

Small businesses have many advantages over their large-scale counterparts. By taking the time to leverage them—and with the help of some of these tips—you can compete with big box stores and enjoy the success you dreamed of.


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