Small business is a term that often conjures up images of local mom-and-pop shops, design studios, or contractors. And they do exist – they make up nearly half of all businesses in the United States, employing 59 million Americans. These entrepreneurs are essential to the country’s economy, contributing innovation and job creation in local communities.
Small businesses can be organized in many different ways, from a sole proprietorship to a C corporation. In terms of size, they can have as few as one employee or as many as 100 or more. Small businesses can have any number of revenue levels and can operate in a range of industries. The US government, through the Small Business Administration and other programs like Payroll Protection Programs and the recent EIDL grant, wants small businesses to succeed. They offer a variety of programs for companies to get loans and financial aid, compete for federal contracts, and more. But how do you know if your company is small?
The answer to this question isn’t easy. The official definition of small business varies worldwide, but it generally refers to privately owned businesses that are smaller than large corporations in terms of employees and/or annual revenue. In the United States, the Small Business Administration (SBA) sets the standards for how companies qualify as small, which are based on industry and size standards. Using an online tool or referencing SBA’s table of size standards can help you determine if your business qualifies as small.
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