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Competitive Advantage: Big vs Small Business

March 21, 2012

One of the biggest advantages that a large corporation has, over a smaller business, is the power of capital. Whether in liquid form or otherwise, the ability to produce limitless capital allows a larger organization to implement big changes in their infrastructure, like the kind they need to grow further. However, a small business will find it hard to make such investments because, frankly, the numbers just aren’t as big.

It is considered extremely hard to make your first million. Once you have that in your bank, the next can come very quickly – that is a general understanding that goes around in the world of business. An understanding that is quite logical considering that your investment capability rises after you make your first million. However, to get to that million, smaller businesses have to slog harder and need all the help they can get.

Money Suckers

Historically, small businesses have been working in old-fashioned terms. Big corporations and software developers create a whole set of tools for businesses but since they are always looking for the most amount of money, it ends up being something expensive that only large corporations can buy. Small businesses struggle to find a footing in the world of technology as everything comes with an outright cost, a monthly license fee and other charges, all of which are intended for just one thing – making money for the big companies who make these products.


While things like a CRM or an employee payroll system may not be needed for a small business with five employees, they would certainly benefit from their usage. An accounting software or a CRM system would give their business a stronger foundation and ensure that they are, amongst other things, using these fabulous tools for their own benefit. However, this cannot happen because the kind of applications we are talking about here, require large amounts of investments, not just in terms of physical infrastructure, but also in terms of the money they cost.

Silver Lining

Every cloud has a silver lining and that lining, in this case, is the “cloud” itself. There are more people in the world who need cheaper services that they can afford, as compared to larger organizations. Manufacturers and software developers realized that for every large company that buys one software package, there are over a thousand small businesses who could use technology to make more money.

With the Internet helping people find a way to sell their products and services to people from around the world, these cloud services are getting extremely popular. Without having to go through the trouble of spending thousands of dollars on tools that require special environments to work in, you can simply opt for a cloud-based technology that resides on another computer somewhere on the planet, leaving you to access it through the Internet.

Immediately, you cut out on the cost of the infrastructure and that is a major chunk of what you would have to spend. Then there’s the cost of running that infrastructure, which goes out of the window too. All you are left with is a monthly fee that, depending on the service you are opting for, and will keep your applications & data up and running on a safe environment that has plenty of provisions to protect you from system crashes, security threats and more.

Software as a Service

Also known as SaaS, the concept of offering accounting, inventory, time-keeping, project maintenance and other software on these clouds, and giving people access to them on a monthly-paid basis, is something that has picked up in this time and age. As the Internet speed keeps hitting newer heights, bandwidth exceeds all expectations as well, while browsers and browsing, in general, are getting more user friendly.

By hosting your data on an external farm of servers, that belongs to a company whose sole job is to maintain that farm, you ensure complete safety of your data at unbelievably low costs. In the US alone, this format of offering SaaS has been projected to grow, from $2.4 billion, to $4.1 billion by 2013, for companies with 100 employees or less. As license fees, for software like CRMs, ERPs and more, shoot through the roof, these SaaS facilities are hitting the big companies where it hurts and helping the smaller companies find more ways to compete with bigger companies. If you are a small business owner and want to expand your business by adding in a sales team, then don’t think twice because you can equip them with the best possible tools for just a few dollars a month and get all the benefits that big organizations spend thousands of dollars for.

KYLIE THOMPSON – author

Having worked her way up the world of Information Technology, Kylie became a manager in a medium sized IT firm in the heart of the Silicon Valley. Her specialization lay in the field of customer relations and that included working on applications like the IT helpdesk. Completely dedicated to her work, Kylie took time off to raise her twin girls, who give her just about enough time to write a blog. Her previous job awaits her should she choose to return to the desk at some point in the future.

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