Local Retailers vs. Big Box: How Small Businesses Can Stay Competitive

Ever since the dawn of the big-box store, smaller local businesses have struggled to compete.

Fast-forward to 2019 and the picture is far less rosy for the big boxes. Store closings are rampant, some iconic retailers are fighting for survival (Sears) and others have gone out of business entirely (Toys "R" Us). Despite this, big-box stores still represent significant competition to small retailers.

Below, we explore tactics that small businesses can use to provide a retail experience that the big-box stores simply can’t replicate.

Leverage Your Local Niche

One of the biggest differences between big-box stores and small, local businesses is that big-box stores are built on a business model that requires them to order large quantities of every product they carry. This often results in the carrying of generic products made in bulk overseas, and leaves little room for bringing in new, locally made products to offer repeat customers. If big-box shoppers are looking for a new, unique product to try, they won’t be looking for it at their local big-box retailer.

This is something small businesses can take advantage of by offering customers something they can’t get at the big-box store down the street. Many small businesses work with local artists and retailers to find unique products made in smaller batches. Being the exclusive retailer for a line of products is a great way to encourage repeat customers interested in niche goods and gifts that are unique and harder to find.

E-commerce is King

Consumers expect retail brands to offer convenient online shopping options that are optimized for use on any digital device. The easier your products are for consumers to access any time, any place, the more likely you are to succeed in growing your customer base and earning multiple purchases from loyal customers over time.

At minimum, small, independent retailers should have a well-designed, easy-to-use e-commerce website that is optimized for mobile browsing and shopping. It should be populated with high-quality images, information about your company and brand, an easy way for site visitors to get in contact with you and your physical locations and hours (if applicable).

Get Social

Aside from your e-commerce website, a social media presence has become a crucial aspect of retail success. A small business should plan it’ social media posts and presence with as much care as they do their brick-and-mortar merchandising strategy. Your online aesthetic should match your physical presence to give customers a strong sense of who you are.

Small business should also use their social media following to promote deals and discounts. Beyond just posting images and deals to their social media accounts, retail stores have also now begun adapting their physical locations into social-media-friendly spaces, encouraging shoppers to take pictures or “check in” to share their location and experience in stores with friends and followers. The goal of this fun, low-cost strategy — often called “omnipresence” — is to encourage your shoppers to share the love with fun posts that connect you to their social circle.

Customer Service is Key

Beyond product offering and merchandising, the service and experience you and your sales team provide to your customers will set you apart from those big-box competitors. Be sure that your return and exchange policy is clearly displayed in-store and online. Be friendly and personable when someone does have a problem with a purchase and try to find a solution that will leave the customer satisfied in the end.

On the flip side, encouraging online reviews of your small business is an effective way to ensure that your customer service is top notch. Personally respond to each review left on platforms like Google My Business and Yelp, especially the negative reviews. Customers will notice if you take the time to acknowledge negative feedback, share your response publicly and make a sincere effort to turn dissatisfied customers into happy ones.

Memorable Merchandising

While big-box store design is often directed by headquarters, small businesses have greater freedom to let their creativity flourish. Using custom retail displays to showcase your products, updating front window displays regular and using custom signware are just some ways that small businesses can emphasize their brand’s uniqueness.

Small businesses also have the luxury of finding display solutions that are tailored specifically to their store. We know that store layout and the shopping path customers are encouraged to follow impact sales, so custom displays that are designed to lead customers through an optimized path through merchandise is an important strategy to consider.

Fine-tuning your merchandising strategy to be everything a big-box store can’t be will always include creating an experience that shoppers want to re-live because it’s unique, sparks joy and piques interest. Creative merchandising can influence customers to linger in a store, find new merchandise they may not have seen before and become curious as to what the store might look like or have to offer the next time they visit.

Jeff Hastings is chief marketing officer for Visual Creations Inc.