How Do Buying Habits Vary Between SMEs and Larger Companies

Jul 31, 2019

4 min read

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Small and medium enterprises face a lot of challenges, which explains their low survival rate. However, the last couple of years they’ve shown persistence and innovation with their businesses. They’ve become the driving force of the economy, overshadowing larger companies as key figures. In this article, we will speak about the buying habits of consumers and companies and whether these habits truly vary.

Speaking of buying habits we can look at them in two ways:

  • the buying habits of companies
  • the buying habits of consumers

When speaking about buying habits of companies, we immediately think of B2B purchasing. That’s a trend that has been dramatically increasing the last couple of years, like waking up from its long slumber. Moreover, the trend is going to continue in the future, making B2B a bigger market than B2C. The buying habits of consumers is a whole new world to explore. Some spend $20 on coffee while others buy the most affordable smartphone.

How to Identify Customer Buying Habits

USA have always seen some crazy online shopping habits. For instance, a rare Nikes from 72 were sold at an astonishing $450.000! On the other hand, a crazy B2B transaction happened between Apple and a German company when they bought 345 iPhones for their employees, as a gift for Christmas. Reflecting on this, we can see there are as many types of customer buying habits as there are customers. Each buying behaviour, whether B2B or B2C, depends on the location, generation and purchasing power.

Location

A company’s location can enjoin purchasing certain equipment to secure a seamless work of the company. For instance, if a company is located in an area where the temperature is high, they continually need to invest in air conditioning, which is a lot more than those working in areas with moderate climates. Additionally, if the company is located in an overpopulated area, in order to keep their employees from leaving the job, they need to pay the travel expenses or even hire transpiration services.

Generational Differences

As Millennials are becoming the generation in charge, they are bringing changes to companies that add expenses older generations would never do. For instance, the progressive movement around the world is asking companies to add a transgender bathroom. We think that’s fair, but companies running on a tight budget could find themselves in trouble. Adding a new room in the office is not as easy as it sounds. Additionally, Millennials like more recreational space in the offices. That’s also an expensive activity that SMEs often have trouble accomplishing. All in all, some of them are unnecessary, but new trends and ways of thinking make it mandatory.

Purchasing Power

Let’s face the truth – some economies have more purchasing power than others. In developing countries, people can only afford the most essential expenses and everything above that line is labeled as luxury for the First World. For instance, buying iMac computers is pretty normal in the UK and US, and SMEs can easily afford them. On the other hand, companies from Poland and Croatia do not have the budget to buy high-end computers and go for a more budget-friendly option.​

SMEs VS Large Companies Buying Habits

There is a big difference between the needs of SMEs and Larger Companies, hence the different buying habits. SMEs spend less money because they are companies that usually outsource some departments such as IT, accounting, marketing and more. On the other hand, larger companies have all those departments as part of their companies, which obviously makes them bigger purchasers.

For instance, outsourcing accounting is a fixed monthly expense for SMEs, but have zero responsibility for purchasing the supplies required to do the job properly. However, larger companies, on the other hand, require supplying materials for their departments monthly, which means more money going out of the pocket.

That’s why corporations have bigger and more straightforward buying habits. There is an annual plan, and all the decisions are made by the board. Also, all of the unplanned purchases must be green-lighted by them or the transaction won’t happen.

Small and medium businesses are more flexible on that matter. There are less complexities and even when they arrive, they are handled by the directors/owners themselves.

Enterprise League exists to connect SMEs with our B2B platform. Join today and find the right supplier accross different industries, locations and number of employees. Expand your connections and grow instantly!

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