Is the Internet Killing Small Business?

In a time when shopping can take place from home, in seconds, without all the distractions and annoyances that normally accompany a shopping trip, eCommerce is a solution that many embrace enthusiastically. The internet made it possible for retailers to sell products and services online to people they’ll never meet or even be within 3,000 miles of.

But is it killing small business?

Is the Internet Killing Small Business?

Selling to such large audiences makes it practical for exclusively-online retailers to sell a wide, diverse range of products (like Amazon) at almost unbeatable prices that small brick-and-mortar businesses struggle to compete with.

That solution benefits consumers, but it’s a frightening sign for many small business owners.

It’s clear that exclusively online businesses are finding an advantage in their methods of operation, but is the trend going to continue? Is the internet killing small business?

Small business can’t survive based on past models

The idea that what’s worked in the past will continue to work is inaccurate. The game is different now that the internet has created an expectation of instant availability and unmatched convenience.

Some small businesses try trudging along, continuing to follow their old strategies and plans in the hopes that things will return to normal and business will be better. This doesn’t happen. Don’t rely on outdated instructions to a new game.

Internet prices are too cheap to compete with

Small businesses face the disadvantage of competing with internet companies that can order large quantities of items to have in stock for cheaper prices than they can get from the manufacturer.

Because companies that operate exclusively online serve a much wider and more diverse audience than the typical brick-and-mortar small business, they make more sales in general and earn higher profits. They can order more of the same items, getting a lower price than a small business buying smaller quantities would ever be able to get. And if small businesses try to lower their prices to compete with the online retailers, they quickly find that it’s not a sustainable business model and will put them out of business.

Pivoting can save small businesses

While a small business may not be likely to survive in competition with an exclusively online retailer who offers the same products for a lower price, they may be able to survive and even thrive by pivoting at the right time. Owners should take stock of their current employees, decide who should be part of the new venture, and what suitable ideas for strategic changes could be implemented.

Many small businesses have chosen to simply move horizontally in their industry, from offering products that they are being outsold in to offering services that appeal to the same audience, but don’t directly compete with the internet product prices.


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