You can learn about government procurement opportunities through federal agencies and get free help for your small business (including technical support) using the resources you can find at SBA.gov. To determine if your business is considered small, you need to know the precise SBA measure, which is based on the North American Industry Classification System (NAICS) code for your business type. For a complete breakdown by industry, see the Electronic Code of Federal Regulations. You apply for SBA loans through approved lenders for these loans (usually traditional financial institutions such as banks), unless you apply for a catastrophe loan, in which case you are applying for SBA.gov. Eligibility requirements for SBA loans vary somewhat, but your business must be considered a small business to be considered for one of these loans. But what exactly do these small businesses look like? But here`s a summary of the definition of size by large industries: The business can be a sole proprietorship, partnership, corporation, or other legal form. When determining what constitutes a small business, the definition will vary to reflect industry differences, particularly size standards. One of the main reasons to qualify as a small business is that your business is eligible to apply for SBA loans. There are a number of SBA loan programs that offer low interest rates and attractive repayment terms for eligible business owners. But on the other side of this argument, some companies with 1,500 employees are still considered “small” and technically enjoy the same protections as a small business of 10 people in their industry – so sometimes the size standard doesn`t benefit the smallest businesses in the country. SBA Small Business Size Standards are used to determine whether a small business is eligible for SBA and federal contract opportunities. There are three main measures that determine whether a business is considered a small business: Here`s exactly how the SBA defines small businesses and why they made these definitions in the first place.
The SBA generally defines small businesses as those with fewer than 500 employees and startups as those that have been in business for a year or less. But what is “small” in a retail store compared to a utility is another matter entirely. Therefore, the SBA provides refined definitions for each type of business, based on the number of employees or annual turnover. According to the SBA, a small enterprise is an independently owned and operated enterprise that does not hold a dominant position in its field of activity and that meets certain industry criteria. In addition to assisting with financing and contract opportunities, the SBA provides advice, training, and technical assistance in all aspects of small business management through Small Business Development Centers (SBDCs) in the United States and its territories. Because the small business sector creates so much value, many government agencies and private organizations provide resources to help them grow and succeed. Small businesses that use these resources greatly increase their chances of long-term success. A U.S.-based for-profit business entity that operates primarily in the U.S.
or makes a significant contribution to the U.S. economy through the payment of taxes or the use of U.S. products, materials, or labor. The following table provides an overview of the main types of classifications for small businesses and their eligibility criteria. Click on the name of the type of small business you wish to redirect to the SBA website to learn more about the resources and programs available for each type of business. While agencies such as the Internal Revenue Service and the Equal Employment Opportunity Commission measure businesses by different standards, the SBA definition for small businesses is most often used to allocate government and private resources to small businesses. If you look at the different size standards set by the SBA, you might think that all small businesses in the U.S. are actually quite large.