What strategies can small businesses adopt to compete with larger companies

Expertise from Forbes Councils members, operated under license. Opinions expressed are those of the author.

POST WRITTEN BY

Nate Huskins

Founder and President of Marshal Group LLC (exportusautos.com), which exports vehicles from the U.S. and Canada to destinations abroad.

Jan 28, 2020,07:00am EST|

• Share to Facebook
• Share to Twitter
• Share to Linkedin

Photo:

If you are a small-business owner looking to hire top talent, you may feel you are at a disadvantage. How can you compete with big companies that offer more affordable healthcare, on-site gyms and other attractive perks?

Based on my experience running a small business, I’ve found that the key is to be proactive. Offer job benefits that are less likely to be found at a big company. Here are nine examples:

1. Offer flexibility with scheduling.

If possible, allow your employees to create work schedules that best fit their lives. This helps them create better work-life balance. At my business, some employees come in at 6:30 and leave at 3:30, and others come in at 8:00 or 8:30 and leave at 5:00 or 5:30. Honestly, I don't care that all of these schedules are different because my employees still complete their assigned work.

2. Explore remote-work opportunities.

Perhaps not all of your employees can work from home full time or even part time. However, some jobs may adapt well to this scenario. Currently, I have one employee who works from home two days a week, and it’s working out well. I also recommend a “work from home day” every month. Every employee gets to pick the day they want to work from home. I believe this arrangement is good for morale, and it’s likely that employees’ work efficiency increases at home where there are fewer interruptions.

3. Establish a casual dress code.

If you don’t have a retail presence, why not let employees work comfortably? People tend to dress more casually in general these days because they value the ease and convenience of wearing their favorite clothes. At my office, you will see people wearing jeans, shorts and yoga pants. My newest employees really appreciate that. They came from businesses where they had to dress in business attire. Now they love not having to dress up because they did it for years and became tired of it.

4. Provide free food.

Consider setting out office snacks or arranging regular lunches. At my business, I buy lunch for everyone every Thursday. I have done that for over 10 years. Usually, I have employees take turns picking food from a favorite takeout restaurant. Everyone chooses from the menu. We order the food, and somebody picks it up and brings it to our office. Then we all sit in the kitchen and eat as a group. It's a good way to get everybody talking and laughing together.

5. Offer more frequent bonuses.

A few years ago, during a trip to Toronto, I had an interesting discussion with another business owner. When the conversation turned to the topic of employee raises, she said, "I don't give raises. I do bonuses." I instantly thought, "That's a good idea!"

Here’s why: Giving raises during good years is easy. However, that practice gets really expensive for a small company during the down times. The practice of offering bonuses tied to company performance is a safer bet and can motivate employees to watch expenses and meet goals. When the company is doing well, everyone benefits by receiving bonuses based on a percentage of net profits. During tougher times, bonuses can be scaled back or put on hold to make your business more sustainable. This can also give you a stronger cash position, which can be crucial if you have financing opportunities or a covenant.

I also hand out Christmas bonuses to further build good will.

6. Grant PTO instead of separate vacation and sick time.

I got away from the vacation-time-versus-sick-time wrangles and went to straight PTO. That means employees have more flexibility and control when they need or want to take time off from work. PTO also eliminates disruptions caused by employees randomly “calling in sick” when they just want a day off from work. I’d rather they prepare for their time off and inform clients, vendors and other employees of their plans to be away from work.

7. Emphasize job stability.

I have found that some people don't want to work for small companies because they're afraid those companies might go out of business. They think they are going to be more secure in a corporate setting. Personally, I believe that is a misperception. My office is located near a massive Fortune 500 company that lays off employees on a regular basis. A bigger company doesn’t always mean better job security. I like to emphasize that point when I interview job candidates, and I always mention that layoffs are not a common occurrence at my company. In fact, I have never laid off anyone during my 12 years in business.

8. Provide offices instead of cubicles.

The Fortune 500 company I mentioned above has vast offices filled with cubicles. So do many other big companies. That gives you another opportunity to make your business more attractive to potential new employees. Design your facility so that it is an attractive, nonsterile environment.

If possible, try to place every employee in a private office. When I designed the interior of my business, I placed all the offices along the windows so that everyone has a view of the outdoors. Compare that to the corporate world where it’s a privilege if you can even see a window from where you’re sitting.

9. Allow flexible vacation time.

Many large companies have employees select vacation weeks based on seniority. Those with more tenure get to pick their weeks first, and the rest have to make do with whatever weeks are left over. However, as a small business owner, you can let employees pick vacation weeks of their choosing — with no strings attached.

Remember: You really can compete with big companies when trying to attract new hires. Follow some or all of the tips above to make your place of employment more compelling.

What strategies can small companies use to compete with large ones?

How best can small retailers compete with larger chains?

Why can small business compete with big ones?

What are the 4 competitive strategies?