Companies like Facebook and Uber say they’re supporting small businesses while squashing them.
Major corporations really want you to know how much they care about small businesses — as long as those small businesses don’t compete with them or cause them too much trouble.
During the pandemic, big companies were sure to draw attention to the ways they were supporting the little guy. Facebook highlighted all sorts of ways it says it helps small business and warned that regulations for the social media giant would actually come at a cost to the little guy. Uber, likewise, emphasized its help to restaurants. And now that the economy is rebounding, powerful business interests say they’re still looking out for the up-and-comers on issues such as wages, unemployment, and regulation, a common talking point being that any changes might put smaller operations at a competitive disadvantage.
What can get lost in this is that small businesses already are at a competitive disadvantage, often because of the bigger players that purport to support them. Large corporations are happy to invoke small business when convenient, especially when it helps them keep power. It’s essentially reputational laundering. But what can be less obvious is that these same entities are constantly finding new ways to stunt small-business growth to keep new entrants and potential competitors at bay. They also create roadblocks and find ways to extract money and power from small businesses in order to maintain their positions and increase profits.
“They use their power as gatekeeper to reach customers as a way to extract fees and unfair terms on small businesses, yet they will still use and create PR and claim that any regulation of them would hurt small businesses because they are this platform that has enabled all these small businesses to exist,” said Sally Hubbard, director of enforcement strategy at the Open Markets Institute, an anti-monopoly think tank, who focuses on Big Tech.
Anyone who wants to pay to reach customers online is at the mercy of Facebook and Google, which essentially are a cartel that controls the internet ad market. Just four companies — Uber Eats, GrubHub, Postmates, and DoorDash — control the majority of the restaurant food delivery market; restaurants have little choice but to pay whatever fees and commissions they charge. Banks are constantly telling us how they love to work with up-and-comers and help get entrepreneurs on their feet. But as we saw with pandemic-related small-business loans, many were much more eager to help out larger operations and businesses they already had relationships with
