Although we often read in the press about a small company winning a massive contract with a large multi-national or government department, the reality is that this is the exception rather than the norm.

The fact that it has hit the press as a newsworthy item says it all. It is not easy for small companies to win contracts against larger competition but it is possible and the good news is once you have got the hang of it, it does becomes easier…just.

In my experience, where I regularly win orders with big name clients against tough competition from across the world shows that it can be done. My company has sold its advanced Web site analysis service to an impressive number of large clients including Endsleigh Insurance, Iceland, half a dozen building societies including the Portman, Chelsea and Leeds, Amdega Conservatories, holiday.co.uk, three universities and over thirty councils.

We even won a large order from a US real estate company just a few miles away from our largest competitor in Silicon Valley. Talk about coals to Newcastle! Not bad for a small company located just off the M4 corridor. Well nearly three hundred miles off to be exact: North Shields in Tyneside.

The one essential ingredient that a small company requires to be successful against larger competition is confidence. If you as an organisation are not confident in your own abilities to take on a larger competitor then you might as well not bother. Your lack of enthusiasm will permeate throughout your presentations and meetings with prospective clients and will eventually lead to a predictable outcome. Confidence on its own will not guarantee that order but without it you are going nowhere.

Unless you are extremely lucky, you will from time to time fail to win orders from large customers, even if you offer the better proposition, for no other reason that they prefer the competition because it is larger than you. You need the confidence to pick yourself and go for the next one. It’s not fair but nobody’s going to listen, least of all your next potential client.

To be successful we have to be the same as our competitors and yet at the same time be different. So how do we manage to achieve the impossible? First, we aim to have as many unique design features and functions over our competitors’ offerings which will give our customers tangible benefits from using our service. Secondly, even with these advantages we need to ensure that in a head to head we match all our competitors’ features and functions.

But if your product or service is similar to a competitor’s then how can you differentiate yourself? The answer is the small company’s secret weapon, the one area where being small works to your advantage, the soft underbelly of your large global, multinational competitor: flexibility. Although a lot of large companies can be satisfied with off the shelf products and services they often have special unique requirements that require a custom approach.

A lot of your larger competitors will either not be able to provide that flexibility or use it as an excuse to exploit the customer with extortionate pricing. If you can convince your potential clients that your flexible, personal, adaptive, caring, responsive approach will give them the results now and in the future you are onto a winner.

So far we haven’t discussed pricing and to be honest it isn’t important. It does help if you are just underneath your competitor’s price but being miles under or over does tend to work against you - just think about it! The main reason a large company will be fulsome in its praise about your excellent proposal, why it will wax lyrically about your beautiful presentation and then give its order to your larger competitor is risk. A large company will consider placing an order with a small company as risky and will often play safe by placing it elsewhere.

To counteract this tricky problem develop a number of strategies to help reduce your potential customer’s perception of risk with your proposal. Some ideas include short term contracts, trial periods, pay as you go, inclusive support and maintenance, extended warranties, financial guarantees and certification. Depending on your product or service you may find it easier to have successes with larger companies by working with resellers. For reasons I don’t profess to understand some large organisations will not buy products and services direct from a small company but will buy the same products and services through a reseller.

One factor that does improve your chance of selling to a large company is your track record of working with large companies. But before you start shouting at the page there is a way you can kick-start this process. It does work. It is how we got started. When we first developed our software we offered it to three well known large organisations to use it free of charge for a year. They accepted. The rest as they say is history. So although it is difficult, it is possible and it is worth it. Working for a small company there is nothing to quite match the feeling when you land that big order from a large company from under the noses of your large multi-national competitor - marvellous!

BIOS, Mar 15, 06 | Print | Send | Comments (0) | Posted In Miscellaneous