Small businesses grow faster when they work together

In many emerging markets, small businesses are taught to compete.

Each business focuses on winning customers, negotiating better prices, and protecting its space.

Growth is often seen as something that must be achieved individually through effort, persistence, and sometimes sheer survival. But in today’s economy, that view is incomplete. The businesses that are growing fastest are not always the strongest on their own.

These are the ones that understand how to work with others, even those they might normally consider competitors.

A powerful idea is now becoming more relevant in business: companies can compete and collaborate at the same time.

This idea is known as coopetition. It means that businesses do not have to choose between working together and competing. They can do both, depending on where value is created. When applied well, this approach allows small businesses to expand their reach without losing their independence.

Across markets, a clear pattern is emerging. Small businesses that find ways to work together are able to reach more customers, deliver more consistently, and compete more effectively than those that operate in isolation.

This is because no single business controls the entire value chain. One business produces, another distributes, another connects to customers, and another enables payments.

Even when you think of the businesses that produce, they could specialise such that some produce the inputs to a product, while others assemble the final product.

In distribution, some could be wholesalers, others retailers. Individually, each plays a role, but together they create a system within which real growth happens.

Yet many Small and Medium Enterprises (SMEs) continue to operate alone. They market alone, negotiate alone, and solve problems alone. This limits their scale and increases their risk.

They lose the benefit of economies of scale. A single business can only go so far. But when businesses collaborate, even in simple ways, their capacity expands. They can share access to markets, improve efficiency, and respond to opportunities faster. In effect, they begin to operate as part of a network rather than as isolated players. The digital economy is making this shift even more possible.

Technology allows businesses to find each other, transact more easily, and coordinate their activities. Payment systems reduce friction, communication tools make it possible to operate across distance, and digital platforms connect buyers, sellers, and service providers. What was once difficult is now easier and more affordable.

However, technology alone does not create collaboration. Trust does. Businesses must believe that their partners will deliver, communicate honestly, and act in ways that support the relationship. Without trust, collaboration breaks down even when the technology is available.

In practical terms, coopetition can take many forms. Small businesses can come together to supply larger organisations that require scale. They can share distribution channels to reach new markets, coordinate sourcing to reduce costs, or partner with logistics providers and digital platforms to improve delivery.

A retailer and a nearby business may share customers, two producers may combine supply to meet a large order, and service providers may refer clients to each other instead of competing for every opportunity. They still compete, but they also collaborate where it creates value.

This requires a shift in mindset. Instead of asking how to beat the competition, businesses begin to ask where working together can create more value.

This does not mean giving up competitive advantage. It means recognising that growth does not always come from doing everything alone.

In strong networks, information moves faster, opportunities are identified earlier, and resources are used more efficiently. Businesses support each other in ways that reduce individual risk, and over time, these networks become engines of growth.

For financial institutions and policymakers, this shift is also important. Small businesses should not be seen only as individual entities but as participants in networks.

Supporting SMEs, therefore, means strengthening the systems they operate in, including platforms, supply chains, and ecosystems that enable collaboration. When these systems work well, growth accelerates across the economy.

The implication is clear. In today’s economy, growth is no longer just about effort. It is about connection. The businesses that will move fastest are those that understand this early.

They will compete where they must, but collaborate where it creates value, and through that balance, they will grow beyond their size.

Remember, technology connects you to opportunity. Trust turns relationships into growth. Networks take your business further than size allows.

- The author writes at the intersection of the trust economy, digital growth and transformation in emerging markets