Graffiti - Sample Web Development Company Business Plan

INDUSTRY ANALYSIS In the United States there are nearly 27 million small & medium businesses. Small & Medium business for this purpose is usually defined as a business with fewer than 500 employees. However, of those small businesses, over 20 million are solo players. Of the remaining 5.9 million, the vast majority have fewer than 20 employees. The needs of businesses within that range  ‐‐  from 1 person to 500 employees  ‐‐ differ dramatically. Among large corporations that have exhausted their growth in the enterprise market, small businesses are seen as fertile ground for new prospects. Among smaller businesses, often their initial strategy is to serve other small and midsize businesses. Smaller customers are easier to come by because there are more of them. But understanding the small business market can be tricky. That's because it covers a wide range of business needs, and those needs are often (although not always) related to business size. In the United States alone there are nearly 27 million small businesses, according to statistics from the Small Business Administration (SBA). The generally accepted definition of "small business" is under 500 employees. (Although for lending, contracting and other purposes the SBA actually has a variety of size standards depending on the industry). Of those ~27 million small businesses, approximately 20.4 million are solo players. That is, they are single ‐ person businesses. These are what are called "nonemployer" businesses in government terminology, because they have no employees (assuming you do not count the owner). Of businesses considered "employer" businesses, there are 5.9 million as of the 2005 U.S. Census  ‐‐  the latest figures available. Of these, the vast majority, or 5.3 million, has fewer than 20 employees. For the full breakdown, visit this chart from the SBA's Office of Advocacy for employer business statistics. When you add the totals of the nonemployer (single person) businesses and those businesses that have employees, that's how you get to nearly 27 million small businesses in the United States. To net it all out, the vast majority of small businesses  ‐‐ 25.7 million  ‐‐ have either one person in the business (the owner) up to 19 employees. Roughly 600,000 have between 20 employees up to 499 employees. Small & Medium firms:  Represent 99.7 percent of all employer firms.  Employ just over half of all private sector employees.  Pay 44 percent of total U.S. private payroll.  Have generated 64 percent of net new jobs over the past 15 years.  Create more than half of the nonfarm private gross domestic product (GDP).  Hire 40 percent of high tech workers (such as scientists, engineers, and computer programmers).  Are 52 percent home ‐ based and 2 percent franchises.  Made up 97.3 percent of all identified exporters and produced 30.2 percent of the known export value in FY 2007.  Produce 13 times more patents per employee than large patenting firms; these patents are twice as likely as large firm patents to be among the one percent most cited. © BPLANEXPERTS.COM 2 7 | P a g e