How to Win Larger Clients

Build an excellent reputation, network, and consider subcontracting. Just don't alienate established customers and don't spread your company too thin

by Karen E. Klein

My small company has done well in its niche, but we'd like to attract larger clients so we can grow more rapidly. How do we break through to the next level?

—J.B., Kingwood, Tex.

The short answer is that you must be so good at what you do that your reputation outgrows your niche. Don't just deliver for the clients you have—over-deliver. If your current clients are so impressed that they rave about your service or product, that information will trickle up to the bigger players in your industry.

Next, look for introductions to some of the midsize players, so you can ramp up gradually. If you're a small firm, you're probably not equipped to handle very large contracts just yet, so go after clients just slightly larger than those you currently work with. It will be incumbent on your sales force to demonstrate that you have the personnel and the resources to handle these larger contracts, so be prepared to make some new hires or contract with some freelancers if necessary.

Capitalizing on Crossover

In most niches there's considerable crossover between suppliers, vendors, and major corporations. Perhaps your current clients, suppliers, or even industry analysts you've met can introduce you to some additional business owners. Or you can try to meet some larger potential clients at meetings and trade shows. You can also develop your reputation by contributing articles to industry publications or arranging to speak at industry events.

Work your natural contacts, and don't be afraid to let them know that you're expanding and would like to attract some midsize or larger contacts. But be cautious: Many niche players in your position stumble because they ramp up too quickly or they are tempted to expand into unfamiliar areas, and wind up spreading themselves too thin (see BusinessWeek.com, 8/1/07, "No Man's Land"). You'll need to reassure your long-established customers that they are still your priority. If they feel that they are getting pushed aside, they may become frustrated with your firm, which could erode your core business before you can even think about expanding.

Branching Out

If you're aware of those kinds of potential mistakes, you should be able to avoid them, says Larry Weintraub, chief executive of Fanscape, a new media marketing agency in Los Angeles. "For the first five years of our business, we focused exclusively on the music industry," Weintraub explains. "We concentrated on our area of expertise and resisted the temptation to expand too quickly."

When the agency became convinced it had to build on its expertise and branch out, Weintraub says, they looked to natural extensions of their niche. "First was film and home entertainment because it was a natural fit for us. The same people that listen to music also go to movies, buy DVDs, and play video games. We just had to get to know the players. People in the record business were able to introduce us to people in these new places, which led to new projects. Meanwhile, we never let go of our music business, and we have continued to develop our product to make it more efficient both for us and our clients," he says.

Be Available for Overflow

Another avenue you might pursue is to subcontract some work from your larger competitors. Seek out the big firms serving your niche and let them know that you will do an excellent job helping with their overflow business. Most firms occasionally find themselves in the uncomfortable position of having to turn down large jobs that come in at the last minute. If you've made it clear that your company is available to help turn around difficult jobs quickly and in a quality fashion, you just might pick up some crumbs that will improve your revenues and serve as introductions to executives at some larger firms. Eventually, your company may grow large enough to get those contracts directly.

Karen E. Klein is a business journalist who covers small-business issues for several national publications. She writes her Smart Answers column twice a week.