Role Of Small Business In Economic Development – Economists around the world theorize that small businesses and startups are one of the most important factors for economic growth. But what? Let’s get into it and see why small businesses are important and will they ever rule the world?
Let’s start with one of the most important functions of small business – creating job opportunities for people. While large companies dominate the stock market, small businesses drive economic growth by creating job opportunities in rural areas. According to the Small Business Administration and the US
Role Of Small Business In Economic Development
The Center for focuses on supporting small businesses by helping them in the development stages driving economic growth in Southwest Colorado and the Four Corners area.
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Small businesses and startups help bring some competition into the business world. Take for example a farmers market. Many people would prefer to go to the farmer’s market instead of the big grocery store. They get more value, better organic produce and the prices are usually cheaper. Additionally, customers will know that the products are produced more ethically than anything you would buy from a big company.
Another side is. Small startups will be able to implement these faster than a large corporation because they do not need to change the way the entire company works.
As of 2012, 14.6 percent of small business owners were minorities, compared with 11.5 percent in 2007. This includes 2.3 million Hispanic-American owned businesses, 1.9 million African-American owned businesses, and 1.6 million Asian-owned businesses. In addition, 36% of small businesses are owned by women.
Diversity in the business space helps to bring more perspectives, ideas and views on the world that drives success of the company. Diversity and inclusion are important components of any successful business and small businesses play a huge role in showing it to the business world.
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Currently there are 28.8 million small businesses in the United States. It’s a big number but will small businesses ever rule the world? A large movement around small businesses helped people to see a different side of large corporations and to understand why it is important to support small businesses. People have seen how unethical large corporations can be and how much damage they cause. Big retail companies like Amazon are taking over and making it very difficult for small businesses to survive.
Most companies will never be cheaper or as fast as Amazon. This is almost impossible to achieve for small businesses that do not rely on millions of workers when producing their goods.
However, Amazon still tries to include small businesses by offering their fulfillment and their platforms. For example, Amazon Handmade, a marketplace for artisans to sell goods made entirely by hand, threatens to push marketplaces that crafters have long relied on (ie, Etsy) out of the space. While Amazon gives sellers a larger audience, They also charge significantly higher fees – a commission fee of 15% compared to Etsy’s 5%. Another issue will be different resellers pushing their cheaper products on Amazon.
There are many obstacles in the world for small businesses. Fortunately, small businesses have something that big companies can’t. They can adapt and adjust their business much faster than large corporations. Additionally, small businesses offer a more personalized customer experience and win over large companies that way. They may not rule the world but will continue to incorporate with bigger companies and contributing to the economy of the country.
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Although small businesses may not take over completely, we believe that they will continue to be an important part of today’s economy. The Center for offers multiple resources to help you and your small business change the world.
Small Businesses in Durango and How You Can Support Them in 4 Steps 2.5 times as many innovations as large firms relative to the number of people employed More than half of the major technological advances of the 20th century originated with individual inventors and small business inventions could ignite new industries or contribute to established industries Copyright © Cengage Learning. All rights reserved.
Providing employment Small companies hire a greater proportion of younger workers, older workers, women and part-time workers Small businesses provide 67% of workers with their first job and initial job skills. Of the private labor force small businesses provide 2/3 of the net new jobs added to the economy Copyright © Cengage Learning. All rights reserved.
Source: US it. Department of Commerce, Bureau of the Census; Administrative Office of the US it. courts; US All rights reserved.
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Supply competition Small firms can compete with large firms, forcing the larger firm to become more efficient and responsive to customer needs Filling needs of society and other businesses Small firms can meet the special needs of smaller groups of customers Small firms can act as specialized suppliers of Goods and Services to Larger Businesses Copyright © Cengage Learning. All rights reserved.
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