Competitive actions of small firms in a declining market

Abstract

Small firms, through their flexibility advantages and closeness to customers, potentially can increase their sales volume in economic downturns. The decline in U.S. housing construction (beginning in 2006) provided an opportunity to develop and test four hypotheses predicting the attributes and marketing actions associated with successful companies supplying housing markets. Smaller firms and those producing made-to-order products were most likely to have realized increased sales volume. These successful firms were not engaged in several marketing actions hypothesized to increase sales volume in a declining market. Small firm competitiveness was based more on working closely with customers to produce fully customized products.

Citation

Bumgardner, Matthew; Buehlmann, Urs; Schuler, Albert; Crissey, Jeff. 2011. Competitive actions of small firms in a declining market. Journal of Small Business Management. 49(4): 578-598.