What is the definition of a small business? Often times it is hard for new business owners to understand exactly what it means to be a small business, since so many large companies have become large simply by growing and expanding. There are many different factors that go into whether or not a company is considered small, but in general the following characteristics are present:
This definition has two underlying assumptions. One is that the company is a sole proprietorship, the other is that there is only one person who owns the company. This assumption affects how the definition is written, and also the reasons why the company would be considered a small one. If the sole proprietor owns the company, then it is obvious they do not have any employees and thus would be considered a small company.
However, if there is more than one person owning shares in the company, then it can be argued that this too could be considered a sole proprietorship, but in this case it would still be a very large company. The second assumption is often made when looking at these definitions, is that the company is a partnership. In this case, there are several ways in which all of the shareholders in the company would be considered owners. First of all, each shareholder will receive an equal share of stock. Then, depending on the agreement, each shareholder would receive dividends according to a formula that has been created by the shareholders.
Another question that often arises with respect to who is considered a small business is whether or not they are actually small. How do you determine who is a small business and who is not? Many business magazines and newspapers will ask small business questions, and some of them have specific standards for what small businesses are. Other business owners define a small business differently, depending on their own criteria. Some may consider themselves to be a small business, even though they do not meet the requirements of the Small Business Administration (SBA). It is important to remember that even if you are not a small business, you can still be considered a small business when you adhere to the qualifications of the SBA.
Who is considered a small business also depends on the laws where you live. In some states, the definition of a small business may be very different than in other states, so you need to look at the laws that apply in your state or locality before determining who is a small business. If you are looking into starting or expanding a business, then you will want to make sure that you are familiar with the legal requirements for doing so in your area.
Who is a small business also depends on your definition of . . . . . . a small business. When you are starting out, especially if you are only a new entrepreneur, you may be trying to figure out what type of business to start. Do you want to sell products? Create your own products? Rent out space to do business?
Do you have the time and resources to run your own business? Are you willing to spend the time and energy it takes to get up and running each day? There are many people who work from home who are successful. However, they didn't know what they were doing when they started. In order to know if you have the time to commit to something, it helps to take an inventory of your time. You should know how much time you have available to devote to your business before you ask yourself whether or not you are a small business.
So who is a small business? That depends on who you want to be, as well as what you are willing to put into your efforts. With so many opportunities available today for small businesses, it is helpful to know who you would rather be. Whether you are interested in making money or helping others, there is a small business opportunity waiting for you.