I bought some clothes from a merchant via Amazon. The company that I ordered from shipped the wrong item. I sent it back and was told it will take three or four weeks to process my return. A month!
I wrote back, asking why it would take so long. The response, "Thank you for your inquiry. To answer your question we are NOT an big company like Amazon we are actually a small company, That is why it does take us a little longer than others."
Of course, you'd think a small company could be faster. More important, you'd think the company would realize that I couldn't care a whit about how small they are... I just want good service.
If your small company can't deliver a better experience (in areas people care about) than a big one, why on Earth should someone do business with you? I'm not saying you must have faster service, a bigger website, lower prices and twenty-four hour a day phone support. I'm saying that for some of your customers, you have to be monstrously, demonstrably, better.
The web is a great equalizer. A tiny business can have a better website than a huge one. A tiny business can do better customer support than a big one. A tiny business can write a better newsletter than a big one. Maybe not for everyone, but everyone is for the big companies. The passionate minority is happy to embrace the small company. As long as they focus and don't whine about it.
Small is a weapon, not an excuse.