By: Mark Kleinschmidt
How Much Do They Make?
What percentage of small businesses bring in more than $1 million in sales?
Before we answer that, let’s first define what we mean by small business. The SBA definition of a small business is 500 or fewer employees. We think that is way too big, our definition of a small business is any company that has 20 or fewer employees.
So just how many of these small businesses are in Anne Arundel County and what kind of annual revenue do they have?
According to data from the Anne Arundel Economic Development Corporation, the County has 22,266 businesses. Interestingly, 92% of these businesses (20,500), employ fewer than 20 workers. This underscores the significant contribution of small businesses to our economy. It further emphasizes the need for the Chamber to support small businesses across the County.
Let’s take a deeper dive into these statistics and see just how much revenue different size small businesses make. Check out this chart:
When we consider revenue data from the Census Bureau, we can see that most small businesses make less than $1 million. Many folks call businesses with less than 20 employees a Main Street business or a Mom and Pop shop. In reality, they are everyday businesses that might not be of interest to venture capitalists who are looking for big payday, but they are a vital part of our economy since they employ thousands of people and generate hundreds of millions of dollars of economic activity.
These small businesses may not have the power to revolutionize their industry, but they constitute gig workers, solo enterprises, and owners of small restaurants. They can also include software developers, electrical contractors, day care providers, auto repair shops, social media consultants, pet store owners, IT companies, accountants and small-scale manufacturers. They offer great employment opportunities and the necessary products and services we count on every day.
A significant number of these small businesses owners grapple with making ends meet and find themselves struggling to grow their business. They aspire to reach that $1 million sales mark. The Chamber is a great resource to help them get there.
So where does your business stand on the road to $1 million dollars or more? Could you use a little help to get there?