How do you distinguish a small business from a large one? Are sales the key indicators? What about market share or number of employees? The Small Business Administration (SBA), the federal agency most directly involved with this sector of the economy, considers a small business to be a firm that is independently owned and operated and is not dominant in its field. The SBA also considers annual sales and number of employees to identify small businesses for specific industries.
· Most manufacturing businesses are considered small if they employ fewer than 500 workers.
· To be considered small, wholesalers must employ no more than 100 workers.
· Most kinds of retailers and other services can generate up to $5 million in annual sales and still be considered a small business.
· An agricultural business is generally considered small if its sales are no more than $500,000 a year.
The SBA has established size standards for specific industries. These standards, which range from $500,000 to $25 million in sales and from 100 to 1,500 for employees, are available at the SBA’s “Size Standards” Web page, http://www.sba.gov/size.
An excellent example of small business-and its founder-owner- can be found in a 97-year-old former Lutheran church in Maynard, Massachusetts. Ron Labbe’s 3D is the world’s only one-stop shop for all things 3-D glasses. When Polaroid dropped the product, Labbe moved quickly, buying the remaining inventory of 750,000 pairs at 2.5 cents each. Today, they’re hot sellers at 25 cents apiece.
Since government agencies offer a number of benefits designed to help small businesses compete successfully with large firms, operators of small businesses are interested in determining whether their companies meet the standards for small-business designation. If it qualifies, a company may be eligible for government loans or for government purchasing programs that encourage proposals from smaller suppliers.
No comments:
Post a Comment