Filed under: Consumer experience, Newspapers, Competitive strategy, Wal-Mart (WMT), Small business

A piece in the New York Times reports on the main competitive advantage of small stores: They're small. According to the article, "Small retailers around the country are using a host of marketing tactics, from the usual extra emphasis on customer service to putting out free cider and cookies. But their most important step may be that they are trying to make the most of their inherent advantages over larger competitors."

A common criticism of low-cost behemoths like Wal-Mart (NYSE: WMT) is that they knock out mom-and-pop competitors. This complaint certainly isn't without merit, but small stores often can survive Wal-Mart if they can find a way to make themselves more attractive than big boxes -- in spite of their higher prices.

The stores mentioned in the Times piece are doing just that creativity and entrepreneurship. And everyone wins: Wal-Mart forces these stores to provide better customer service. In spite of all the bad press about Wal-Mart's bad service, the reality is that it actually improves customer service at its competitors, who have to find a way to compete other than price.

So if you're one of the anti-Wal Mart brigade who does your holiday shopping at small local businesses, think of it this