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Monday, January 4, 2010

Do Small Businesses Matter?

There is always quite a bit of discussion in the news about businesses. On any given day there are articles about the stock market, international regulations, and of course federal bailouts. But what about small businesses? Don't they deserve out attention?

According to the U.S. Small Business Administration Office of Advocacy in 2006 98.2% of all firms in the U.S. had fewer that 100 employees (this breakdown by puts that number even higher at 99.7%). So why, then, do all business related news items revolve around large corporations? I think there are two main reasons:
  1.  Though small companies account for the majority of U.S. firms they provide only 35.6% of jobs.
  2. Most small businesses aren't publicly traded, so there are no stockholders clamoring for information.
While these are both good reasons to pay attention to what the big guys are doing small businesses provide a substantial contribution.  According to the same piece on small businesses account for:
  • 52.6% of all retail sales
  • 46.8% of all wholesale sales
  • 24.8% of all manufacturing sales
Let's hope that 2010 is the year that small businesses finally get the respect they deserve.
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