Don’t take this email the wrong way. I love a small businesses with less than 10 employees.
They are nimble. They can move quickly. They can adjust. They can do things that don’t scale and they can grow.
And they are exceptional opportunities for aspiring entrepreneurs.
But big businesses (50+ employees) have a massive advantage in the marketplace – especially in home services.
Why?
Three main reasons:
- Money.
They can afford to invest. They have cashflow that can support the owners, cash reserves AND investing in the things required to grow.
The bottom line is that it is exceptionally expensive to grow a business.
Recruiting is expensive. Marketing is expensive. SEO is expensive. Nice vehicles and office space and warehouse space is expensive.
They know that investing $15k per new hire is a price they would happily pay to recruit a tech. They know $10k a month on SEO will pay them back $20k. They know $10 per click on Google is a price they would happily pay to acquire customers and they’re willing to spend $50k a month to do so.
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PSA: I use AdRhino to manage all of my monthly ad spend on Google and they have been doing an excellent job.
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Small business owners can’t wrap their head around that.
So they get left behind.
2. Assets.
Their website is an asset. It ranks ahead of everyone else. Their trucks with advertisement wraps are assets. Their Google Business Profile with 250 reviews is an asset. Their people who know their processes are assets.
But the largest asset:
Their customers and their network.
They have the flywheel of word of mouth started. They get referrals. They have brand recognition. And they have relationships with buyers.
They have a big rolodex of people who call them everytime they need something – and the only thing that can build that is TIME and EXPERIENCE.
They have data – they know what to expect. They can look back at past years and predict seasonality, revenue, expenses, etc.
3. Specialization.
All of their people can specialize in what they do best. Each person at the company has 1 job.
At a small company people have to do many things. And they are required to be more competent and better decision makers. And it is an environment of chaos.
At a large company employees can specialize in doing what they do best. Over and over again. While other people take care of the rest.
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I made a post on this topic earlier today. Join that discussion here:
| https://x.com/WilsonCompanies/status/1754502126737227883?s=20 |
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This entire discussion is something I’ve changed my mind on over time.
A few years back I would have told you that a small scrappy company had a big advantage. I’ve since changed my mind and I understand the big advantages that larger companies have.
Once you get a machine rolling down a hill with 10 million or more in annual revenue, it is ON. And the rich start getting richer.
The owner can afford to make investments to grow the company without skipping a family vacation that year. And so they do and they win.
Why small businesses struggle:
- They can’t afford leads
- They lose all of their people
It is expensive to get leads and they can’t afford to invest before the profit comes. And all of their best people get recruited away by a big shop who can offer massive signing bonuses and higher pay.
Ok so what now?
How do I overcome this as a small company?
You copy what the big dogs do. You spend money on a great website. You invest in your Google Business Profile. You spend money on SEO. You wrap your vehicles. You spend money on marketing.
You fine tune your website so that it is VERY easy to become your customer.
If you need recommendations for vendors on any of these services, check this out:
And you recruit and hire like a madman. You raise your prices so you can afford great people. You utilize overseas talent like the big dogs do.
And you do a lot of the things that don’t scale while you can. Bandit signs, networking events, mailers, flyers, whatever.
Onward and upward,
Nick Huber
P.S.
If you’re interested in hiring an overseas employee to work remotely for your company, I recommend supportshepherd.com.
I’ve hired 30+ employees through them and you can get exceptional talent for 70% less than US equivalents.
Customer service, data entry, estimating, financial analyst, admin assistant, etc.
Anything that can be done from a computer, these folks can do extremely well.
Reach out to Shepherd today to get that process going.