Times are a changing and so it seems is the definition of small business! Come November 5, 2010, recent changes in the Small Business Administration’s definition of what a small business is will take effect. The redefinition will expand the title to encompasses approximately 18,000 additional businesses in 70 industries. About one-third of the new small businesses are car dealerships.
Currently, the definition of small business is different based on industry and has different qualifiers including number of employees or annual revenue. While the definition of small business will still vary by industry, the previous cap of around $7 million in annual sales will jump to over $120 million. I don’t know about you, but that doesn’t sound like such a small business!
Personally, I think this is bad for more traditional small businesses as they will now have to compete for small business loans and other assistance against much larger, more established companies. I was under the impression that the Small Business Administration was established to help small business but that at some point those businesses would be big enough to support themselves. However, it seems that between the new definition of small business and the big business bail-outs, corporations are now going to be receiving the same ever-increasing, always-under-funded, cradle-to-grave, broken welfare system that the American public is being forced to swallow.
Some speculate that this new small business definition will help the government meet its quota of 23% small business contracts, which is the amount of small businesses they try to award government-contract assignments to. Well, if you change the definition, goals are a lot easier to meet, aren’t they!
As a small business manager or owner, what are your thoughts on the new definition of small business? I hope you find this small business news article useful and I will follow it up with additional news as it becomes available. Please send this small business news along to your friends and colleagues using one of the social media or email link buttons below!
(Image: Some rights reserved, David Paul Ohmer.)
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