Winning business from big firms when you’re in small business can really push a smaller company forward.
Usually, large firms are more established than smaller firms and doing business with them reduces the risk of the company going bust before your bills are paid. Large businesses are also usually very professional and often, doing business with them is a pleasure because the people within them understand how to behave professionally and are highly trained and skilled.
But when you become a supplier to a big business as a small firm, it’s also important to ensure your profit margins are not squeezed and that the big firm doesn’t become your only customer. As part of risk management in business, it’s always crucial to have a diversity of income sources so that if you lose your one big customer, your business won’t be compromised.
Here’s a list of things to watch if you plan on playing with the big boys.
Act like a big business
If you own a small business and you plan on pitching or tendering for work with a bigger business, it’s important to act like a large company to increase your chances of winning the work. This means dressing professionally and ensuring your branding and marketing look sharp (a website is also important to show you’re a serious enterprise).
Acting professionally also means ensuring your phone is always answered during business hours. There are plenty of companies that provide support services to small businesses to ensure phones are always answered. If you don’t have the staff to answer the phone during business hours it’s a good idea to have a relationship with one of these firms to give the impression your business is serious and substantial.
Leverage work with other big businesses
Big businesses like to know you’ve got experience working with other big businesses. It gives them confidence you know how to meet deadlines and work within the often bureaucratic structures that permeate large companies.
So if you have worked with other big businesses and you’re pitching for new work with a big firm, make sure you play up your credentials in this area to give you the best chance of winning the job.
Don’t be intimidated
Sometimes big businesses can put pressure on smaller businesses to cut margins and profits just to win the work. If you’re pitching for work with a big business and the company wants you to lower your profit margins so much that the job won’t give you a return, stick to your guns or walk away from the deal.
No matter how much you want the work, if you’re not making money from it, it’s not worth doing.
And while you might have to be flexible about your normal payment terms, don’t wait too long for your money from a big company. If your bills aren’t being paid, form a relationship with the accounts department of the large firm you’re working for and directly ask when your invoices will be paid.
As the saying goes, the squeakiest wheel gets the oil.Catch more tips from Kochie, 11am Sundays on Channel 7!