Contractor’s Corner: How can a local contractor compete with a national one? – Oct 2025

By Dave Stafford

Just about everyone has faced this dilemma. A national company with multiple locations comes to town and is being aggressive in your region. How can you compete with their stronger financial base, larger credit lines, more personnel and access to products you cannot buy? A David and Goliath scenario unfolds. Yet you can compete and walk away with business by understanding their weak points and emphasizing your strength as a local contractor.

Do what you do best 

As a local contractor, offer personalized services. You built your business in this region, and you live here, too. You have a reputation to protect. Feature case studies on your website, and when submitting a proposal (even if not required), include a couple of happy clients in a similar business segment. National companies have references, but they may not be local.

The “good ole boys” network should be alive and well. Don’t cringe when asked if you operate in other regions; say, “No, we specialize in a 25-mile radius of the area to give five-star service to our clients.” 

If a potential client is impressed with a proposal from a national company, try, “I’m sure they’re a fine company; however, we’ve been in business for 15 years and believe in working with our neighbors. If we’re close on price and quality, wouldn’t you rather do business with a local? I know I’d rather be able to look the boss in the eye if I’m having an issue.”

Some local companies offer specialized services, including same-day remedial work and small repairs, three-hour emergency service, cleaning and refinishing. They’ll also take on smaller projects with a smile or be more agreeable on deposits and final payment. “What will it take for us to get your job today?”

Push installer certifications, especially those requiring hands-on training and testing. CFI or INSTALL, with their various rankings and specificity, would be an example. Do not overlook seminars given by manufacturers and their certifications. If possible, have your own in-house training programs for specialized installation, vertical lift installation, floor leveling, poured floors or heat welding of sheet goods. This will set you apart from some of your national competitors. As a smaller company, we used to push CFI’s CII certification, held by many of our team leaders; on important projects, we guaranteed that the installation would be managed or performed by a Master II-level certified installer. “Jerry, you are buying this intricately patterned Axminster carpet. Frank was just certified as a Master II installer, one of three installers to attain this rank in the state. He will be the team leader on this project.”

Bigger is not always better

There’s always the issue of higher overhead, slower response to big problems or vacillation in making decisions on a local project. “Over $50,000, I have to get approval from the regional manager.” Or, “I agree with you that there is a defect, but the company’s third-party expert must do an inspection before we can fix the problem.”

The local contractor will have fewer restrictions, less bound by layers of bureaucracy and rules. Usually, the overhead of a national contractor is greater. They will likely have more employees, offer more benefits or perks, and a greater footprint and warehouse space; all of this takes more money to maintain. Also, there will be a factor added to return money to the headquarters. A local can bid jobs lower because overhead burden is lower; they may take jobs at a lower markup and more risk in the hopes of margin enhancement changes.

A national contractor may be slow to respond to certain requests or prevented from taking on projects or bidding over certain dollar amounts without prior authorization. As a local, think about your credit lines and how they might be impacted if you needed an extra 15,000 yards of carpet. One approach is to have a candid conversation with your mill rep before bidding on the job. Perhaps there is special project pricing available for certain products that mills stock in large quantities. What can they do for you if you are successful and get the bid? The worst possible scenario is when your product is ready to ship and there is a credit hold. That will do more to send your blood pressure skyrocketing than anything.  

A national contractor must deal with adverse publicity, locally, caused by other branches. This may result in a lower satisfaction rating among clients. Assets may be encumbered and a credit rating lowered through no fault of the local branch. On larger jobs, their D&B rating or credit lines may point to instability. If the company goes through bankruptcy, what happens to that local branch and your project? We were working on a job for a national company and had made some progress; however, when we attempted to complete the job and get paid, the doors had been locked. We got our attorney involved and found out they were out of project money; we immediately filed a mechanic’s lien against the property. We finally collected about 60 cents on the dollar. We were the local contractor, but the lesson applies.

A local may have a better relationship, thus better pricing and credit lines with lower-tier manufacturers hungry for certain business. Many first-tier product suppliers already have their favored/key dealers. Partnering with a small manufacturer for a certain segment of business, a smaller school system contract or a local government open-ended contract might be possible with lower expected volume. They can “wheel and deal” on some smaller jobs for cash or other consideration or forgo certain big company procedures; cut deals with others on ancillary services, whereas national brand companies may be locked into specific suppliers or in-house services. We were awarded a job for a dentist’s office buildout because we were able to give a discount for cash and prepayment, whereas the larger company made no distinction between cash, check, or credit card. They were inflexible and offered strict terms only after requiring a credit check. I bid a smaller job but reached an “understanding” with the buyer due to the amount of the award and the slower response by the national company. They were more qualified, but we got the job because we were able to meet his timeline. 

In one instance, the national company’s site inspection resulted in a rather inflexible menu for floor prep and overstated the amount and type of corrective action required based on product choices. I showed the buyer/owner, who was low on money, where he could save time and money by reducing expensive floor prep by changing his product selection.

A smaller local contractor may have a more astute project manager who developed the original job scope rather than splitting duties among a project manager, project coordinator and field inspector. This way, there was no delay in making decisions on the extent of or need for change orders.

Five-star proposals and bid responses

Certain sales promotions may not be done by national companies, while a local company can offer weekend getaways, trips where the liquor flows freely or “personal private motivations” for certain buyers.

A well-presented, carefully constructed proposal will give you the best chance to walk away with the project, an edge against the national company with its boilerplate language. A poorly designed, lazy effort will ensure the local won’t get a second look, even if your price is the lowest. A superb proposal backed up by the company’s award-winning reputation will make up for some variation in pricing, even with publicly awarded bids. 

In the case of a public bid opening, a national company included a brochure and stated that it had experience; however, it did not provide any local case studies, only a vague reference to ones from the company’s network. Although we were not a low bidder, in a private conversation, we pointed out that “you have the right to also select an alternate or back-up bidder” for an award. The buyer felt compelled to award a contract to the low bidder, but we got an award as an alternate at our prices. Sure enough, the national company flubbed a job on timing and performance; we ended up doing most of the work under the contract.

Other tips for beating the 'big guys'

The absolute best reference is one where you’ve performed work for several years, have a warm relationship with an articulate person, and have recently asked them (again) to be your reference. Do not take them for granted. Woo them, and if they agree to take a phone call or respond to an email, send them a thank-you note. If they go the extra mile for you, send them a “dinner on me” gift card. There is no better salesperson for you than a great reference. 

Local problems need local solutions, so don’t go after the largest local target. Look at your typical delivery/installation geographic area. We stayed closer to home and limited our involvement to local government or bids. This way, the delivery of projects could be staged to avoid undue stress on project management and installation personnel. Fewer installation teams were needed. The national contractor may assign jobs to “keep a crew working” rather than the best one for a specific job. They are more likely to employ in-house installers than the local contractor, who may use subcontractor installers. 

Pick different segments of the commercial business from those being pursued by a national company-small school systems, local government facilities or the community’s hospital, property management tenant build-outs, general contractors or law firms with special requests and smaller dollar requirements. We landed a 200-yard carpet job to do the executive suite and boardroom; after completing that weekend project to rave reviews, we were referred to several other law firms with similar projects. Most jobs really didn’t “go out for bid.”

I was fortunate enough to participate, for some 21 years, in the growth of a small company to a national one. I used many of the techniques mentioned in this article to enable the company to expand from a local regional dealer to a large, commercially known contractor. Through our General Services Administration (GSA) federal contract, we were able to provide products and installation services on a national basis and to many military facilities and embassies worldwide. We were the largest independent GSA contract holder at one point and among the first to offer “on-contract installation services.” I vividly remember those days when we could beat the “big guys” and come away with the business. Yes, you can compete with national contractors! 

The Author

Dave Stafford is a former flooring company executive with over 35 years of experience in commercial, government and residential sales and management. He can be contacted at dave@dsainfo.com.