In a couple of months the holiday season will be upon us. This means that million of retail workers will do the unsung work of helping all of us get ready to flex on our family about how good our party is. Surely confirming our spot on the top of our respective family hierarchy. Many in the news talk about the big guys like Walmart, Target, and the Bestbuy’s, but no one really talks about small businesses and their holiday rush. Small businesses hire a great number of people, and in some cases the holiday season is even more “make or break” for them then it would be for a large retail store. But more and more I find that small businesses trying to compete with the big box store in the wrong areas, like reducing costs, when they really should be focusing on customer experience and maximizing revenues.
How do you compete with the big boys? Well it’s simple, you don’t, you offer something that they can’t. The easiest way to do this is to offer a unique product or service, hopefully one that can generally sell itself. But if you’re like most businesses you can’t really do that (although you should be trying), so try and offer an experience that keeps the customer coming back and build customer loyalty.
How do you do this you may ask? Well try paying your employees more, take In-N-Out Burger for example. If your in California, or have ever been to the West Coast, you have probably eaten there, and if you’ve eaten there then you have surely seen the massive line that occupies the drive-thru from 11am – close. In my experience every time I go there I have a pleasant experience, from the employees that actually look like they are enjoying their jobs to the fact that massive line always seems to work itself out in an orderly fashion. Possibly because they actually have someone that will go to your car and take your order, and will get you your drinks, so you can have something to sip on before you get your cheap, but good food. Compare this to most other fast food restaurants where, yeah the food is cheaper but you kind of want to get out of there as soon as possible after you receive your food.
In-N-Out Burger crushes it in food quality and experience due the fact that their employees actually buy into and believe in the business. They buy in because they have two things, a high starting salary (in comparison to other fast food joints) and a clear sustainable path to promotion. Business Insider reported that some In-N-Out Burger managers make upwards of $160,000 a year. It’s incredibly easy to buy in when a lower level employee can realistically get to a stratospheric yearly wage, with enough hard work. Although as a small business you can’t pay everyone this much but try and keep your ear to the street and see what your employees think about your company. Are they happy at work? Do they see themselves working there in 5 year, or is it just a short gig for them? If it’s the latter see how much they are paid compared to a competitor and adjust pay to higher than the competition, not an extreme amount but enough to show your employees that you really do care. Typically people tend to see jobs as a gig and not care when they get paid peanuts compared to other places.
It’s true that for most people the discerning factor in choosing a product is price, and to be honest that is fine. A small business has a distinct advantage in the fact that they are agile enough and small enough to not need a whole bunch of customers to sustain itself. If Target only gets a hundred thousand customer in a month, it’s ready to declare bankruptcy, but if some small business gets 1/100 of that amount, it’s a home run month. It about building a brand and fostering employee and customer loyalties/relationships. There a reason that people still shop local when big box stores exist and in order for your small business to flourish you need to create friends not just sales. So this holiday season, a few dollars more per hour may have big dividends for your business.