Would You Like to Work for Many Smaller Companies or Would You Prefer a Few Larger Companies?
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| Photo by Anthony Tran on Unsplash |
Hanifmr.com - The customer search is part of the daily work for the self-employed. Regardless of whether you have to “clean the door” or whether the new customers find you on their own, an important decision is always which company you want to work for.
There are of course many factors by which one can choose one's customers. One of them is the size of the company.
So today I would like to investigate the question of what the advantages and disadvantages are when you work for small or large companies.
Would You Like to Work for Many Smaller Companies or Would You Prefer a Few Larger Companies?
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| Would You Like to Work for Many Smaller Companies or Would You Prefer a Few Larger Companies? |
Many self-employed people are happy about every single customer in the start-up phase. Nevertheless, at some point, you should specialize and that includes the decision for which target group you want to work with specifically.
After all, it makes a big difference whether you work for many small companies or a few large companies. In the following, I take a look at the advantages and disadvantages of smaller and larger customers.
If you can contribute your own experiences, I would be happy if you leave them in the comments.
Advantages of Smaller Businesses
Small businesses offer some advantages as customers, which I will discuss below:
- Shorter Decision-Making Paths
In small companies, the boss is often solely responsible for all decisions. And that's why decisions are usually made faster so that coordination in projects can often be carried out more quickly. - Less Wasted Time
Since small companies and the self-employed do not have time themselves, discussions and meetings are often short and do not take up the time of the service provider as much. Of course, you have to make sure that all the necessary things are discussed. - Effective Use of the Funds
Small companies often cannot invest large amounts in projects. This has at least the advantage that you concentrate on the essentials and the projects therefore often remain clear. - Small Customers are More Loyal
Small businesses usually stay with a service provider if they do a good job. This means a long customer relationship because the time it takes to find a new service provider is often not worthwhile for small companies. - Internal Adjustments
Sometimes it is necessary or at least advantageous if internal changes (working method etc.) are made at the customer's, e.g. when it comes to maintaining the new company website. This is usually easier with a small company, as there is often only one person responsible for it. - Risk is Lower
The risk is generally lower. If a small corporate customer breaks away, that's not so bad, because you have a lot of small customers and therefore only a small part of the income is lost. - Payment Behavior
There isn't much to say about that. From our own experience, the smallest pay the fastest.
Disadvantages of Smaller Companies
But there are also disadvantages of small customers:
- The All-Rounder
The bosses of small companies often decide everything that concerns the company but are not the experts in everything. This sometimes takes persuasiveness and good nerves to convince them of the best solution. - Priority List
In smaller companies, employees do several jobs at the same time and are not that specialized. This means that your contact person usually has many other things to do, which are often more important at first. You have to stay tuned here. - Little Internal Resources
Small companies often work “on the fence” and have few free resources. You have to adjust to this and adjust your offer accordingly. But you also have to make it clear at the beginning what kind of effort is required on the part of the customer. - Expectations are Often Too High
That is certainly related to the first point. Those who are not very familiar with an area often have the wrong idea of effort, costs, and results. Therefore, you should be open and honest about the expected results at the beginning. - Sometimes Too Little Paperwork
Unlike larger companies, some small companies don't like paperwork at all. However, important agreements, agreements, etc. should be stored in paper form. If you only do something verbally, for example on the phone, the later annoyance is already inevitable if suddenly there are different opinions about agreements, etc.
Advantages of Larger Companies
Since larger companies have a completely different organizational structure, more employees are employed there and these companies think on a completely different scale, cooperation with larger companies often differs significantly from cooperation with smaller companies or the self-employed.
The advantages of working with large customers include the following:
- Greater Profit
You can earn more money per project, as larger companies can also offer higher hourly rates. In addition, the projects themselves are often more extensive. - Internal Resources
Larger companies have more resources available so that they are more flexible and can better implement their projects. - Direct Contact
In larger companies, you usually have a special contact person during the project, for whom this project is more important. - Follow-Up Orders
The follow-up orders are also often larger than with small companies. With large customers, in particular, good income can be achieved through follow-up orders or maintenance contracts, for example. - Fewer Customers and Projects
Since the individual project generates more money and also means more work, you have fewer contacts and fewer companies. That makes the whole thing clearer and, for example, less time-consuming for billing.
Disadvantages of Larger Companies
But even large customers have disadvantages that you should be aware of:
- The Risk is Greater
When a big customer breaks away, it hurts a lot and means a greater loss of income. Even the preliminary work that has to be done is usually not without it. - Payment Behavior
Strangely enough, larger companies in particular often have poorer payment practices. This is not always the case, but it is already noticeable. Therefore one should agree with early interim payments to have some leverage. - Longer Decision-Making Paths
Important decisions are often made by several people or have to be presented to the boss first. This is why coordination and approval often take longer, which can drag the project out. - More Paperwork
Larger companies sometimes overdo it with the paperwork, which simply costs working time and lengthens projects. - Less Loyal Customers
This is certainly not always the case, but larger companies don't seem to be as loyal as smaller companies. This is certainly also because larger amounts are involved and that there is simply no emotional connection, as is usually the case with smaller companies. - Other Ways
At least if you don't live in a big city yourself, the ways to larger companies are often longer than to smaller customers, who are usually closer and in larger numbers. In addition, the large customers are then more likely to be spread across United States.
Conclusion
The points mentioned are of course subjective and mostly come from the experiences of my earlier work as a web designer and my current contacts with companies.
Both customer groups have advantages and disadvantages and it is not so easy to differentiate between black and white. It also depends on your preferences and ideas whether you prefer to work with large or small customers.
For me, the mix of both was a good solution, as it balanced out the advantages and disadvantages of the two groups quite well and also offered variety. I still enjoy working with small and large customers on my blogs and websites because the mix works best.
What do you think of that? Have you already been able to gain experience with small and large customers and if so, which ones?
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