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The retail and shopping landscape has changed dramatically over the last decade or so. Customers are no longer limited by their physical location. Shopping can be done online and products can be purchased from around the world.
The ease and accessibility of products are a wonderful advantage of the 21st century, but it does bring up a dilemma or two. Customers now have to choose between spending their money with a big business or a small business.
Both types of businesses offer benefits and drawbacks. You should consider and weigh these conditions before investing any of that hard-earned money. Even decisions like choosing between a small insurance company or large can have large impacts on the business, the community, and the customer.
Spending With A Big Business
The term “big business” is tossed around frequently in today’s marketplace. But what makes a big business big?
A big business is a large corporation that usually makes large profits off its products and employees. These are businesses found across the country, or world, and are often very recognizable. Companies like Apple, Google, and Walmart are considered big businesses.
Benefits Of Big Businesses
While there are often negatives associated with big businesses, they do offer a few benefits to the customer. Big businesses have large networks of manufacturers providing many products to stock the shelves. This means there is a higher number of products available at these businesses.
More products mean less wait time and less shopping time. Customers who choose to shop at big businesses can reasonably expect to find what they are looking for with each trip to a big business.
When more products are available, it usually means those products can be sold at a lower price point. Big businesses are able to buy more inventory, and those savings are passed along to the customer. These price differences aren’t always large, but customers can save a few dollars.
Consequences Of Big Businesses
Benefits are great, but they are usually accompanied by disadvantages. Shopping with a big business is no different. While the availability of products can mean savings, there may be other costs to consider.
Some big businesses, like Costco and Sam’s Club, require yearly memberships. Yearly memberships mean yearly fees. These extra costs have to be considered before being swayed by the discounted prices.
Big businesses also mean big crowds. The more people who are shopping in a store, the longer the checkout lines and wait time will be. This can be especially frustrating during high-volume shopping seasons, like the holidays.
And of course, there are ethical risks associated with big businesses. Because these businesses use other manufacturers and companies to source and produce their products, there are questions about the safety and conditions of the working environment.
Spending With A Small Business
So if you aren’t shopping big, then the alternative is to shop small. But is a small business just something a little bit smaller than the Walmart down the street?
A business is considered small when it is privately owned, has fewer employees, and lower annual revenue. The exact parameters for small businesses depend on the industry, but they often have less than 250 employees.
Small businesses are the local, “mom-and-pop” shops that make up the heart of so many towns in America. These businesses succeed through word of mouth, social media presence, and small blasts of press coverage for small businesses.
Benefits Of Small Businesses
Smaller doesn’t always mean less, especially when it comes to business. Small businesses offer a number of great benefits to the customer.
These businesses are able to connect better with their customer base. This means they have a better understanding of what their customers are looking for so they can offer a better shopping experience.
Small businesses can also offer better customer service. Because the customer isn’t wading through multiple layers of employees and managers, they can connect with an individual who has detailed knowledge of the product and company.
Shopping with small businesses also helps boost and protect the local community. Small businesses are often run by local individuals who want to see their community succeed. They support other local businesses or individuals and specialize in customer experience.
When these small businesses looking to expand or improve, they often look to pour back into their area. Many times small businesses help by buying businesses nearby or partnering with others in the community. The money spent in these small businesses helps in that endeavor.
Consequences Of Small Businesses
There are, however, a few drawbacks to small business shopping. The products and services offered by these companies often come at a higher cost. Fewer employees are doing the work or creating handmade products. This means the customer is paying for more of their time.
Handmade, specialty products can also take more time to produce. This can mean longer turnaround times. If a customer wants a product for a special occasion and has little time, then small business shopping can be more difficult.
Small businesses are often run by people who have families and other responsibilities. With few employees, these businesses can hold strange and sometimes inconvenient hours. This can be difficult to overcome when customers are working or otherwise occupied.
Are Big Car Insurance Companies Better Than Small Ones?
So what if you are in the market for a specific service and not a physical product? The debate of big versus small affects the service industry as well. Car insurance companies, for example, aren’t just big businesses. There are smaller car insurance companies offering policies and products.
Many of the same advantage-disadvantage trade-offs exist with car insurance companies. Bigger companies offer more products with more possible discounts. Smaller companies, on the other hand, offer unparalleled customer service and a wealth of industry knowledge. The choice really comes down to what a customer is looking for and values.
The debate over whether to shop with a big or small business is not new, but the debate seems to be heating up. Both types of business offer things the other doesn’t. It’s really a balancing act of availability, cost, and ethical concerns. Next time you shop, consider the impact of your financial investment.
Laura Gunn writes for the car insurance education and comparison site, CarInsuranceComparison.com. She is a big proponent of shopping small and local.