Despite their small size, small businesses play an important role in the economy and contribute to the local community. Whether they are starting a new business or growing an existing one, small business owners face challenges that require resilience and tenacity.
Defining Small Businesses
Although there is no single definition of small business, government entities use several criteria to determine a business’s status as a small business. Most often, these criteria include the number of employees or average annual revenue.
Industry Codes and Definitions
Small businesses are classified according to their industry’s North American Industry Classification System (NAICS) codes. The six-digit numbers are a way to categorize companies for statistical analysis, tax purposes, and other government requirements.
The SBA also uses the NAICS to classify small businesses by firm income and number of employees, which it then adjusts to fit a specific industry’s standards for small business size. For example, a roofing contractor is defined as a small business under the SBA’s Table of Size Standards if its annual revenue is $16.5 million or less.
In addition to providing a steady stream of revenue, small businesses are also known for their entrepreneurial spirit and innovative ideas. They are more flexible and adaptable than large corporations, allowing them to pivot amidst changing economic conditions.
Resilience in the New Year
This past year saw many small business owners overcoming challenges to stay afloat and grow their operations. Among the most notable was the Covid-19 pandemic, which forced many sole proprietors and self-funded startups to adapt and adjust.
Regardless of the size of your business, there are resources available to help you grow it and succeed. Learn about the small business grants, loans, and tools that are available to you and your company.
Credit Unions Are a Great Source of Financing
If you are starting or growing your business, it is always a good idea to explore the financial options that are available to you. Fortunately, there are credit unions that specialize in financing small businesses and offer more personal service than larger banks.
As a credit union member, you can access competitive interest rates and low fees on small business loans. Additionally, most credit unions offer a wide range of services and resources to help you build your business.
Resilience is a key component of surviving the challenges that come with owning and operating a small business, so it’s important to stay connected with your community and be a part of local initiatives and events.
A few ways to do this are by participating in the Small Business Development Center, volunteering with a nonprofit, or taking part in a business mentoring program. You can also find information about business resources on the Small Business Administration website.
The best way to find success as a small business owner is to identify the strengths that you bring to the table and then find opportunities that combine your unique skillset with the needs of your customers. This can be a difficult task, but it is essential to ensure your business will thrive and provide a sustainable income.