Small businesses might have the word “small” in their title, but don’t let that fool you; they are the backbone of any economy. They create jobs, provide goods and services, and contribute to a country's GDP growth. The next time you have a choice between supporting a small business or “one of the big guys,” consider these five points.
Job Creation: The numbers don’t lie. According to the SBA (Small Business Administration), 99.7% of companies with paid employees are small businesses. And over the last 25 years, they’ve created 2 out of every three new jobs for a grand total of 12.9 million new net jobs. That is a significant number!
Competition: Small businesses promote healthy competition. Sure, having the market all to oneself seems like every entrepreneur's dream. But the reality is that sometimes we need someone to light a fire under our asses. When small businesses compete with each other, they drive each other to do and be better, reduce prices, and improve quality. From a consumer perspective, this is beneficial because it offers more options.
Innovation: Small businesses are known for their ability to innovate. It’s that type of outside-the-box thinking that leads them down this path in the first place; they recognized a problem or a gap or a deficiency in the way things “have always been” and have an idea to do it better, faster, or more efficiently. They are also more flexible and adaptable than larger businesses, which allows them to respond quickly to changing market conditions and develop new products and services that meet the needs of their customers.
Taxes: Like it or not, local businesses contribute to the local tax base. They pay taxes on their profits which can be used to fund essential services such as schools, roads, and public safety. According to the SBA, they paid $135 billion in federal taxes in 2018 alone.
Local Communities: Besides job creation that helps reduce unemployment rates in the communities where they operate, small businesses contribute to a community's unique character and help create a sense of place. They’re the ones sponsoring the Little League Team or donating a service to a charity auction. They also tend to support other local businesses and often purchase goods and services from them. This ripple effect creates a network of support that benefits the community as a whole.
Small business is good business - and that’s why we’re so passionate about helping them! They bolster the local economy, support our communities, create jobs, and drive economic growth. Next time you have a choice, choose small.