Small to medium manufacturing businesses face an uphill battle when it comes to competing against their giant rivals for new deals and growing market share. But they also have distinct advantages. They're often nimbler, more responsive to customer needs, and more efficient than their larger competitors.
Now they have another arrow in their quiver—one that lets them capitalize on their other advantages. Cloud-based commerce solutions give SMB manufacturers several capabilities that help them compete with the big boys toe-to-toe. Here are five ways to take advantage of them:
Now more than ever, SMBs can digitally disrupt big manufacturers by moving to a direct-to-consumer model online. Many large manufacturers still don't "get" e-commerce. Their established distribution networks still make money, so they don’t want to disturb or circumvent them.
On the other hand, customers increasingly expect (and often prefer) to interact with vendors online. The Millennials just coming into leadership positions, for example, have never known a time before the internet. Even B2B companies can take advantage of the buying habits of today's digital natives.
Older, more established manufacturers are hamstrung by their distribution model and by their outdated technology. If they are taking advantage of modern cloud computing, they may be doing so by “bolting on” cloud components to legacy systems, creating complexity and rigidity in the process.
By contrast, a smaller company that migrates to a complete, subscription-based cloud solution drastically reduces capital investment as well as ongoing IT activity, including managing security, handling integrations, and performing upgrades. Modern Software as a Service (SaaS) helps you get to market quickly with implementation that takes weeks, not months. It lowers the total cost of ownership, and helps you deploy your resources and talent more strategically.
Common wisdom is that competing on price with big, deep-pocketed competitors is risky—unless you have the business model to back it up. A cloud-centric, direct-to-consumer model can generate significant savings in terms of marketing, sales, and distribution. And with no wholesale markup, you can offer customers a lower retail price than your competitors.
In fact, several innovative small manufacturers have disrupted their industries (just two examples: razor blades and mattresses) with a direct-to-consumer model. They even use the “cut out the middle man” and “we save on advertising” claims in their marketing efforts to position themselves as more customer-focused than their large, hidebound competitors.
Small manufacturers are already nimble and likely more able than competitors to respond to customer wants and needs. A SaaS commerce solution enhances this agility in several ways.
Best-in-class ecommerce systems are infinitely configurable and extensible, meaning that you can tailor your customer’s experience to suit your (and their) needs—separating yourself from the cookie-cutter pack. And if you connect that ecommerce solution to a broader SaaS suite, you open up an entire world of efficiency and analytical power.
Your commerce solution can work seamlessly with your customer solutions (including sales and marketing), your supply chain, and your finance, HR, and other back-office systems. They can share data not only among themselves, but also from outside sources such as social media and the Internet of Things (IoT). You can have your finger on the pulse of your customer base and respond to its needs with highly customized and even personalized offerings.
As you listen and respond to your customers, you can offer them a buying experience that differentiates you from competitors on every level. Take those mattress manufacturers I mentioned earlier. They are, of course, selling convenience—no more spending your Saturday at the department store, trying out mattresses, and scheduling delivery windows. They’re selling savings; they’ve cut out the middleman, and they can offer previously unheard of service, allowing customers to try their product for not days but months with free returns.
As you integrate your commerce solution into a broader digital platform, you can map out your customers’ end-to-end journey and follow them every step of the way from acquisition to retention.
How prepared is your SMB manufacturing business to compete with the giants in your industry? A configurable, connected SaaS ecommerce solution can offer the agility, reliability, and low cost of ownership you need to stand out from the competition.