A small business is defined as a corporation, partnership, or sole proprietorship with fewer than 100 employees. They make less money per year than a regular-sized business. Here are the characteristics of small businesses. These businesses contribute to the U.S. economy in a variety of ways. Read on to learn more. Listed below are some helpful resources for small businesses. Here are some of the most important ones: Contribution of small businesses to the U.S. economy Small businesses create almost half of new jobs in the United States and account for nearly four-fifths of all private sector employment. Among them, eight million people work for 600,000 or more franchised small businesses. They generate over $5 trillion in gross domestic product yearly. And, according to the U.S. Small Business Administration, small businesses create nearly half of net new jobs. Small businesses employ nearly half of all Americans, and they account for nearly half of the U.S. economy. According to the Small Business Administration, small businesses create more jobs than any other sector. Since mid-2009, small businesses have created 60% of new jobs. And, in addition to creating new jobs, small firms have helped create millions of jobs. They also provide many good jobs, with a high level of satisfaction. This may be why small businesses are so critical to the economy. Small businesses contribute to the growth of jobs, but they may not be the driving force behind it. Small businesses contribute to the economy by purchasing goods produced by other businesses, contributing to the GDP and the stock market. As a result, a growing U.S. economy boosts the earnings of all businesses, which in turn helps the stock market. Small businesses also contribute to the identity of their communities. They sponsor local teams, participate in charitable events, and donate to charities. Small businesses make America more vibrant and thriving. Many small businesses create jobs for local residents and contribute to the economy at large. Not only do these companies help local merchants, they also contribute to local charities and reduce carbon emissions. Small businesses often focus on their customers and the community, and are more responsive to community needs than large companies. In addition to these benefits, small businesses contribute to local economies. Thatҳ why small businesses are so vital to the U.S. economy. According to the U.S. Bureau of Economic Statistics, small businesses account for roughly four-fifths of the nationҳ total GDP. Small businesses make up 80 percent of the construction, real estate, and information industries. Despite their relatively small size, they are responsible for nearly half of the countryҳ net new jobs. Small businesses employ about two-thirds of all U.S. workers, according to the Census Bureau. In addition to contributing to the economy, small businesses foster innovation. They make faster decisions and are more adaptable to changing conditions. Many small businesses serve as agents for big companies, selling their products and services. Small businesses also tend to maintain stronger customer loyalty than large corporations. Furthermore, consumers are more likely to patronize small businesses during an economic downturn, allowing them to remain afloat. They also tend to support local businesses more than larger corporations. SBA size standards The SBA is planning to increase the size standard for 45 industries. The increased size standard applies to industries in NAICS Sectors 48-49, eight and nine, and 52 and 53. The increased standard applies to NAICS 531210, which is an office of real estate agents and brokers. The increase from $8 million to $13 million is an example of a change in the size standard. This increase will make it easier for small businesses to compete in the United States. In response to a commenterҳ concern, the SBA issued a proposed rule that would change the size standards for some sectors. The commentersҠcomments focused on larger issues that could affect all industries. The proposed rule would require industry groups to create several size levels within the same industry to identify true small businesses and prevent larger companies from accessing small-business resources. A commenter on the proposal suggested a 50-employee minimum size standard, while another advocated creating a micro-small business designation. SBA size standards apply to many types of companies, including financial institutions. They are not determined by revenue or number of employees, but by value of assets. For small businesses, the size standards are important because it determines eligibility for government programs. If your company fits within one of these categories, youҲe eligible to apply. It may take a while to receive a government emergency business loan, but you can avoid unnecessary hassles by complying with the SBAҳ size standards. A recent study by the SBA shows that reducing the size standard could harm small businesses that are not yet large enough to compete. It could also lead to a larger pool of small businesses, which in turn would result in a lower number of small-business set-asides. This study has the potential to change the way small businesses compete in the federal marketplace. There are other reasons to increase the size standard. Some small businesses are already considered too small, and the government can choose based on experience and size. The proposed rule would expand the size standard for NAICS 541330 firms. This change will benefit small businesses in several ways. The expanded pool of small businesses will allow the Federal Government to select more qualified small businesses for its contracts. Additionally, the increase in size standards will likely lead to increased competition, leading to more set-aside opportunities. In addition, the increased size standard will give small businesses a longer runway to gain experience and competitive advantage against large firms. Although SBAҳ definition of receipts is based on the Economic Census, excluding the costs of subcontracting and other Ӱass-throughԠcosts will result in a higher size standard. Another commenter also raised similar concerns. He recommended a common size standard for engineering and architectural services. Further, he noted that these types of services have a high level of subcontracting. So, the SBA should reconsider the current size standards and make the definition of receipts more flexible. Government contracts awarded to small businesses While large industry giants dominate the government contracting market, there are many opportunities for small businesses to win federal contracts. These small business set-asides are contracts that limit competition for specific types of contracts, making it easier for small businesses to compete. These contracts can be awarded to small businesses with specific skills and capabilities. In order to maximize small business opportunities, small businesses should focus on government contracts that fit their capabilities and meet the requirements outlined in the Statement of Work. In the latest government procurement scorecard, nearly 26 percent of federal contracts went to small businesses, an increase of $13 billion from the previous year. The governmentҳ procurement officials did not reach the five and three percent goals, which were set by the 1997 Small Business Reauthorization Act. Small businesses that are women-owned and have their primary offices in HUBZones were also not as successful. In the past, a government contract was worth millions of dollars to the winner. To apply for a government contract, a small business needs to register its business with the System for Award Management. Additionally, a DUNS number is required for each location. This number can be obtained online for free through the DUNS Request Service. The SAM database will also list any current government contracts. Lastly, a business must meet the size requirements set forth by the Small Business Administration. A successful small business will also be able to meet the requirements for a federal contract. Government agencies also reserve a portion of their contract dollars for small businesses. These sets are usually under $150k. Some set-aside contracts are open to all small businesses; others are only available to Small Business Administration (SBA) participants. Sole source contracts, on the other hand, are awarded without a competitive procurement process. These types of contracts are typically awarded when a single business is the only one capable of meeting the contract specifications. Creating a category management policy for small businesses is an important part of the process. Small businesses can also use category management policies to encourage agencies to buy as a collective entity, thus maximizing the incentives for officials to conduct equitable buying practices. Once they have this information, they can prepare their bids. The next step in the process is preparing bids that reflect the needs of customers. By using category management policies, small businesses can provide all necessary information to government agencies. Small business owners can use government websites to look for federal business opportunities. These websites have comprehensive information about government procurement. The Small Business Administration (SBA) website also has a database of subcontracting opportunities and helps small businesses position themselves in the government marketplace. The SBA website is designed to be the best resource for small business owners who have little or no experience. And with so much information, government contractors are more likely to accept small businesses. The postSmall Business Resources appeared first onSMB Place.