What is a Small Business?

“What is a small business” is a great question, and one that I don’t take lightly. Most people are not asking this question because they don’t even understand the question. The term ‘small business’ is used for pretty much any business that is not a chain. I don’t think this is fair for most small business owners.

We should have another category for businesses that have 50 or less employees and make less than one million dollars per year. These businesses should be called micro businesses, and when laws are being passed the needs of micro businesses should be taken into account. Micro businesses can’t handle what most “small” businesses can handle. Micro businesses can’t pay for expensive lawyers or lobbyists. Allotting for Paid Time Off could put micro businesses out of business!

If you look at San Francisco’s restaurant industry, you’ll see that most new venues are run by restaurant groups. I completely understand why these groups exist, but it is not fair to lump them in with other small businesses in the same category. I think that if you are a restaurant with one location, you have a staff of less than 50 people, and you net less than one million, then you are a micro business. I own a spa with less than 20 employees and we make less than one million per year. Should we fit into the same category as a restaurant group? I think not. We don’t have backing from investors. Every dollar I take in I put back into my business. I pay my employees really well, actually a much bigger percentage than most big spas. Paid Time Off is very hard for me because it puts a major strain on what goes back into the business. I think we should help micro businesses grow so that they can eventually move into the category of small business, and maybe one day even become big business.

If we want “micro” businesses to stick around then we need to create this new category, especially in big cities like San Francisco and New York. It is time to educate the public and our elected officials on the types of small businesses and beg them to stop passing laws that can put hard working “micro” establishments out of business. Remember, micro businesses are here to serve the community. We are actually part of the community: we are presidents for merchants association, we know the other small business owners, we love our customers. Please fight to keep us around!

My proposed categories:

Micro Business - 0-50 (making less than 1 million)

Small Business - 50-100 (If they make more than 1 million)

Big Business - 100+ (1 Million plus in revenue)