When most people think of a small business, we think of the little mom and pop shops in our neighborhoods – the small coffee shops and restaurants nobody’s every heard of. We think of the specialty shops and high end stores that struggle to compete with the multinational retail corporations. We think of startups with 5 or 6 employees and local businesses providing everyday services.
But small businesses in the United States constitute a much larger subset of the country’s businesses than you may imagine. Small businesses are just about everything underneath the Walmarts and Starbucks and make up a shocking 99.7 percent of employer firms (see above image).
The 5,684,424 small business firms in the country employ 113,425,965 people and make up for $5,164,897,905 in payroll. (These are statistics gathered by the US Census for 2011.) This is quite a chunk of the nation’s economy.
The United States Small Business Association defines a small business as:
“one that is independently owned and operated, is organized for profit, and is not dominant in its field. Depending on the industry, size standard eligibility is based on the average number of employees for the preceding twelve months or on sales volume averaged over a three-year period.”
Depending on the industry, small businesses can actually be quite large. The SBA establishes size standards for a small business by industry. Small business classification is also based on revenue for some industries.
- Manufacturing: Maximum number of employees may range from 500 to 1500, depending on the type of product manufactured;
- Wholesaling: Maximum number of employees may range from 100 to 500 depending on the particular product being provided;
- Services: Annual receipts may not exceed $2.5 to $21.5 million, depending on the particular service being provided;
- Retailing: Annual receipts may not exceed $5.0 to $21.0 million, depending on the particular product being provided;
- General and Heavy Construction: General construction annual receipts may not exceed $13.5 to $17 million, depending on the type of construction;
- Special Trade Construction: Annual receipts may not exceed $7 million; and
- Agriculture: Annual receipts may not exceed $0.5 to $9.0 million, depending on the agricultural product.
We Serve Small Businesses of All Sizes
Timesheets.com is one of these companies, employing many of these people! So when we say that we serve small businesses, we don’t mean that we can only accommodate a company of up to 50 people. We serve companies with up to 500 employees.
Got a ‘small business’? Let us help you reduce your payroll size by tracking accurate time and expenses.
Small businesses have very limited budgets and wasting money on inefficiency can mean the death of them. Who knows, if more small businesses utilized a few of the time and money saving online applications offered today, maybe the number of small businesses going out of business within the first couple of years wouldn’t be so staggering.