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Micro businesses and the path to disruption

by Anna Parkinson , 19.09.2013

Micro businesses are growing in numbers and importance. As advances in technology enable new ways for companies to interact with their customers, integrated software and services have become essential for running successful businesses. As this trend continues, it could increasingly be micro businesses setting the standard, disrupting the traditional business environment in the process.

For years now, there has been an influx of successful and diverse companies with fewer than 10 employees – ‘Micro businesses’. A recent study found that almost 400,000 one- or two-man companies (‘Micro entrepreneurs’) are now trading in the UK, up from only 140,000 in 2005; there are almost 5 million micro businesses in the UK accounting for over 95% of private sector businesses2 and 20% of turnover. American research found that 9% work in companies of 10 or fewer employees, and positively for them, they are the most actively engaged, “suggesting something unique and beneficial about working in a smaller, tight-knit work environment when it comes to engagement”, as the researchers went on to explain. If happiness in the workplace is conductive to happiness in general, and combined with a still shaky economy, this trend will continue for some time and into areas of businesses that have traditionally been restricted to large companies.

Until recently, as a small company, you didn’t get the special market advantage experienced by the larger, more established forms. Government bodies, large corporates, institutes and trade associations are traditionally seen as the top of the supply chain, and supposedly set the standard for social and economic well-being, best business practice, enterprise essential products and services and are the clients and customers that small business owners could only hope for. Small companies must simply produce stuff or provide services that people want to buy and want to continue buying into the future, which is tough in a competitive market.

However, in the economically-restricted yet technology-advanced climate we’re in now, it’s the ‘mind of the start-up’ and the organisational structure enabling flexibility and agility that is most coveted. As Darwin famously said, “It is not the strongest of the species that survive, nor the most intelligent, but the one most responsive to change”. As we all adapt to using social media and advanced technology in our day-to-day lives, it’s the ease and responsiveness to change of a small company which is most beneficial.

The only other benefit when responding to change may be access to capital, which big companies, needless to say, have more of. And they have existing technology.

But social media and technology trends such as big data, access to cloud technology and social media doesn’t have to be expensive. Online technology is even a way many of these micro businesses have started; individuals selling through eBay or Tumblr (which will remain being governed as a small company within the walls of Yahoo) as examples. And it’s arguably better to come at it without being lumbered with existing technology and software. There are web-based invoice systems, software programs, social media, mobile apps, call management solutions, online or app-based customer relationship management solutions; and they all enable businesses of every size to be as streamlined and efficient as possible. In addition there are solutions specifically targeted for small businesses.

As a micro business, it’s possible, and necessary if funds are tight, to pick and choose which services are most essential. But there’s also the ability as a small company to trial products with more ease than a large company can do, doing away with age-old procurement practices. They can move with the times more easily; effectively complementing trends as they come and go, such as the rise of mobile working.

Good customer service is vital for all companies, but can be particularly hard work for micro businesses where employees will often be forced to take on more than one role from manufacturer to salesperson, designer to accountant, digital to traditional marketer. A slightly amusing fact is that 70% of micro business owners admit to having taken a business call in the toilet to avoid missing out on new business. Which, as the article producing the research states, definitely highlights incredible commitment by the micro business employees, as well as the competitive nature of the market place.

In providing and using systems and software to bypass this and other issues experienced by micro business owners, these companies can set the standard for larger companies. Customers will quickly adapt and become used to, nay demand, quick responses and 24/7 availability, and as time- and financially-pressured customers, this is obviously the way we’d like all services and products to be provided. This is also true in the B2B space: small companies that are easy to work with and responsive to changes and requirements will triumph over contracts with larger establishments. This is why I would be rich if I had a penny for every time I’ve seen or heard a large company selling themselves as having ‘a small company feel’. We want to know and trust our providers and to feel important and treasured in return.

As long as you get the service you require, within your budget and in the time assumed necessary, it no longer matters where you get your products and services from. This is the reason why local hairdressers, gardeners and window cleaners, amongst others, have survived for so long. And it’s soon to change the way we see all kinds of micro businesses, especially the growing number of micro businesses in new areas of industry, such as technology. So good luck to all those 5 million, it’s your time to show the big guys how it’s done.