And small businesses that embrace the collaborative spirit find themselves in a better position to compete with their larger counterparts.
We may have social media to thank for this new surge in collaboration. After all, social media is radically changing the way we communicate and interact, both as consumers and as businesses. It’s also changing how consumers decide with whom to do business. Today, countless businesses are placing renewed emphasis on corporate philanthropy, social responsibility and community relations. Social tools also give businesses, particularly small ones, an unprecedented opportunity to connect with others and collaborate.
Of course, collaboration isn’t just some “touchy-feely” trend. Practical benefits exist for companies that think outside the box and work with others. In short, businesses can harness the power of the collective to move forward in a variety of ways.
No matter your industry or occupation, business is driven by referrals and connections. A web designer recommends a copywriter or SEO expert. A plumber suggests a carpenter. A mechanic recommends a windshield repairman. The collaborative small business is always on the lookout for opportunities to help fellow small businesses out. You can either join a formal referral group or forge informal alliances with complementary companies. Whatever method you choose, just remember that whatever you give out, you’ll get back in return.
2. Inspiration and Support
By seeking out a group of like-minded small businesses, you can gain a valuable source of motivation, inspiration and support. Beyond referrals, businesses can share challenges out to their network in order to brainstorm solutions for all. These types of communities can also help relieve the isolation felt by many entrepreneurs and self-employed individuals. Consider joining an online group, actively participating in online forums, finding a weekly/monthly local meetup group or spending time in collocated office space. You’ll be amazed at just how inspired you can become from the energy of others.
3. Symbiotic Selling
What if your business had a circle of small businesses that shared customers and participated in joint marketing opportunities? For example, a local CPA whose clients are primarily entrepreneurs can collaborate with other service providers to put on a “small biz bootcamp,” where they offer a helpful mix of expertise on financial planning, tax advising, advertising, web strategy, insurance, public speaking, etc. to their combined pool of customers. These informal alliances bring new value to current customers, as well as expand your visibility into new audiences.
4. Shared Ownership
All around us are examples of asset sharing that allow a business to lower its costs. Think about a gas station/convenience store that also includes a Subway or Pizza Hut. A shared storefront or office space is an obvious example, but there are other creative ways that small businesses can share ownership to lower their costs and risks.
5. Economies of Scale
By banding together during the purchasing or bargaining procedure, small businesses can achieve greater economies of scale and begin to enjoy some of the discounts typically reserved for larger companies. In some states, health cooperatives create pools for small businesses to obtain discounted rates on health insurance (of course, health insurance policies will vary by state and are generally in flux at the moment). Small businesses can also form alliances with others that have similar purchasing needs to achieve volume discounting on anything from paper supply to maintenance services to health club memberships.
In short, by seeing fellow small businesses as partners and not competitors, small business owners can harness the power of the collective to attract customers, seek inspiration and help their overall bottom line. Collaboration is the new competition, at least when it comes to building a small business.