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Small Businesses Have a Big Impact on the Economy

Define 3 characteristics of a small business. In today's market, how are small businesses contributing to the economy? If you could start your own business, what it would be? Write a few paragraphs about what business you would start and why.

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Define 3 characteristics of a small business.

It is no surprise that small business is the backbone of the U.S. economy. Estimates show that there were more than 627,000 new businesses in 2008 (Small Business Survival Rates, 2010). According to the Bureau of Labor Statistics (Headd, 2000), a small business can be defined as a firm with fewer than 500 employees (in all the firm's establishments combined), more likely to be in rural areas, more apt to be in industries with lower economies of scale (like services). Small businesses are typically privately owned corporations, partnerships or sole proprietorship.

However, the number of employees in a small business varies, depending upon the industry, to be considered small. A small oil refiner can employ up to 1,500 workers, and cookie and cracker makers may have up to 750 workers and be considered small. Other defining characteristics may be revenues, but these too vary by industry, according to the Small Business Administration guidelines (Robertson, 2010). Meanwhile, Forbes (2012) suggests since business with 9 employees or less make up 95% of businesses that should be the definition of a small business. The US. Census Bureau points out that 77% of small businesses consist of just one person (Hindman, 2012).

Ultimately, a small business is ...

Solution Summary

This solution defines three characteristics of small businesses and explain how they contribute to economy. It also gives the description of a good potential small business. APA references included.

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