1. Go where your customers are.
Jacquelyne runs a tiny juice company called Chakwave. I met her in Los Angeles, standing next to an organic lunch truck. Like the little birds that clean the teeth of the hippo, there's synergy here. The kind of person that visits the truck for lunch is the sort of person that would happily pay for something as wonderfully weird as her juice. And the truck owners benefit from the rolling festival farmer's market feel that comes from having a synergistic partner set up on a bridge table right next door.
2. Be micro-focused and the search engines will find you.
My friend Patti Jo is an extraordinary teacher and tutor. Her new business, The Scarsdale Tutor doesn't need many clients in order to be successful. This permits her to focus obsessively and that gets rewarded with front page results on Google. Not because she's tried to manipulate the seo (she hasn't) but because this is exactly the page you'd hope to find if you typed "scarsdale tutor" into a search engine. Could she do this nationwide? Of course not. But she doesn't want to or need to. Living on the long tail can be profitable.
3. Outlast the competition.
I was amazed at all the empty storefronts I saw in LA on my last visit. On one particular block, three or four of the ten lunch places were shut down. And the others? Doing great. That's because the remaining office workers who used to eat lunch at the shuttered places had to eat somewhere, and so the survivors watched their business grow. A war of attrition is never pretty, but if you're smart about overhead and scale, you'll win it.
Rick Toone runs a tiny guitar-making operation. His lack of scale makes it easy for him to share. When others start using his designs, he doesn't suffer (he can't make any more guitars than he already is) he benefits, because as the originator of the design, his originals become more coveted, not less valuable. He leverages his insight and shares it as a free marketing device.
This is the single biggest advantage you have over the big guys. Not only are you in charge, you also answer the phone and read your email and man the desk and set the prices.
So, don't pretend you have a policy. Just be human.