Do you know what happened during the last 24 hours?
A bat has eaten around 1,000 insects, more than 17,000 websites have been hacked, and you’ve inhaled more than 2,600 gallons of air.
Do you know how many small businesses are there in the USA in 2020?
Over 30 million!
These are all just facts in the context of the larger scheme.
Our true goal here is to help you understand all the small business statistics. With the knowledge and insights from them, you will be on your way to success. So let’s shed some light on the situation, starting with some…
Small businesses prove to be the backbone of any economy. More than 600,000 new businesses open each year in the US, according to SBA estimates. In fact, 47.5%, or almost half of the country’s total workforce is employed by small businesses.
If you’ve ever wondered how much does a small business owner make a year? Statistics of US businesses show that’s between $26,000 – $153,000. Compare this to an average salary of $46,800 in the US and you can already see that small business can be way more profitable than regular jobs.
86.3% of small business owners take a salary of less than $100,000.
These small business facts reveal certain niches, which will become more and more attractive in the coming years. Today, skilled trades are overlooked by many, perhaps due to the false belief that trades are poorly paid. In fact, skilled tradespeople are well paid. There will be a huge demand for such in the next decade, so it’s definitely worth investing.
Small business statistics also suggest that meal kit services, software engineering, self-storage units, and senior care services are expected to provide a good opportunity in the recent future.
64% or less than two-thirds of SMB have a website. 94% of those websites are mobile-friendly in 2020.
The small business success rate depends on a number of factors. Be passionate about your business, plan ahead and keep your mind open to new ideas. Plan your budget carefully, be disciplined and focus on the needs of your customers.
Small business failure rate is mostly attributed to a lack of knowledge, insufficient or non-existent internet presence and marketing. Weak leadership, low flexibility, and financial management problems are other top factors for the low survival rate of small business.
Americans are more likely to trust small business, while confidence in big business is in shorter supply. Happiness levels of employees are also higher in small businesses since they generally feel more like a family. Small business employees are more likely to handle different roles and work more.
SBA lending statistics show that in 2019, the average SBA loan was $417,314. The average SMB debt is around $195,000, as stats from 2016 reveal.
According to small business stats and facts, entrepreneurs earn an annual salary of $68,000. 30% work between 50-59 hours a week, although 73% said their hours were more flexible now than when they worked for someone else.
Small businesses drive innovation. They produce 16 times more patents per employee than large companies.
(Source: The Balance SMB)
Small business owners statistics suggest that the main reason behind small business failure is poor planning. SMB owners often neglect the needs of their customers and plan chaotically, leaving market research aside.
Modern-day SMB stats also reveal that 23% of owners are concerned about finding ways to grow their revenue. Other financial challenges for small businesses include healthcare costs (15%) and corporate taxes (10%).
80% of small businesses survive their first year, while only 34% are existent after 10 years.
(Source: Guidant Financial)
Under the influence of social media, people have become more knowledgeable and conscious. SMB stats tell us that gyms, beauty salons, and spas are currently a very popular endeavor.
General retail is also on the rise with a 7% increase in the last year. Business services remain a top choice with an 11% increase and home-based businesses qualify in the top 5, going 6% up.
Here are 10 great ideas for small business startups in 2020:
1. Personal Trainer
6. Online dating consultant
7. Freelance graphic designer
8. Travel planner
9. Massage therapist
10. Tour guide
Having a website for your business is essential in the 21st century. It’s your digital storefront, where potential customers are free to browse and purchase with the ease of a mouse click.
In only a couple of decades time physical shopping will be almost gone, but even now in 2019, the percentage of online shopping is growing. So why leave your customers to go shop through your rivals, simply because you do not have a website?
(Source: Sales Force)
Small business trends will continue to be dictated by social media and digital marketing. The business of the future is operated from home and relies on Facebook to promote its products or services.
(Source: The Guardian)
Starting a new business is different around the world. In New Zealand, there are no payroll, social security or capital gains taxes. Property registration can be done in just two days and there’s an annual growth rate of 2-3%.
Generally, a good place to start your business should have a low tax rate, easy registration rules, and skilled workers available. New business statistics imply that New Zealand is the top place to start your business this year.
1. New Zealand
4. South Korea
5. Hong Kong
6. United States
7. United Kingdom
According to small business statistics, today’s SMB owners are mostly 50-59 years old (35%) and have a High School degree (33%). The percentage of female small business owners has increased by 1.48% since 1996. As of 2015, the women vs. men ratio in small business is 33.02% to 66.98%.
Believe it or not, 70+ year-olds are the same percentage as 18-29 year-olds (4%). Small business owner demographics also indicate that a high number of small businesses in the US are owned by army veterans.
(Source: Guidant Financial)
Cash remains the most popular method for small business financing. Only 5% of owners take an SBA Loan, but ROBS (Rollover for Business Start-ups) is gaining ground. It’s a method of using retirement funds to start a business without tax penalties. You can start your business debt-free and full of cash – what’s not to like.
(Source: Excel Cap Management)
The average cost to launch a startup is around $30,000, according to the Kauffman Foundation. The monthly cost of maintaining a small business in the US, on average, is a little more than $4,000. This is all dependant on location, however, because home-based businesses can start with as little as $1,000-$5,000.
Only 30% of new businesses fail during their first two years, the SBA states.
Small business statistics in 2020 highlight the importance of keeping your budget under control, and prioritizing whatever is essential for your business. Using free software is another good way to cut some costs.
(Source: Chamber of Commerce)
People are really missing out on the most effective channel for building brand loyalty – content marketing, as SMB stats inform. Marketing is essential to your profitability and growth. Still, many small businesses don’t allocate enough money to marketing.
As a general rule, small businesses with revenues less than $5 million should allocate 7-8% of their revenues to marketing. This also depends on their growth rate and the average size of a small business in their industry.
7.29% of avid investors have an affinity towards Bitcoin. Nearly 48% of the BTC community consists of 18-25-year-olds.
Bitcoin transactions typically charge between 0 and 1%, yet the cryptocurrency still appears to be underrated by small businesses. In a recent survey, conducted by Quartz, 8 small business owners were asked whether they would consider using bitcoin in their business. 50% of them rejected the idea, while the other 50% were more intrigued.
Hundreds of corporations and small businesses already accept Bitcoin as a legitimate currency. Microsoft, BigFishGames, Shopify, CheapAir – you have the choice to get ahead of the competition because pretty soon Bitcoin will be accepted almost everywhere.
Customer demands have the power to change the way businesses work. 31% of businesses that adopted new payment technologies did so because of their customers.
The tendency is for online payments and cryptocurrencies to grow in power during the course of the next decade. Having said that, you should know your client demographic and adapt to their particular preferences.
(Source: Small Business)
Adopting specialized tools and software to handle your business needs can potentially save you a lot of money. Small business accounting software, in particular, appears to be on a growing popularity streak.
Automation is an effective way to organize time-consuming tasks like email marketing, social media management, and project management.
Hiring people with good communication skills who are passionate about what you do will put you on the higher end of the small business revenue statistics. Small business trends dictate high levels of self-discipline to be a key factor for the growth rate of small businesses.
Updating your budget on a monthly basis is another trick for good efficiency since any business needs constant monitoring.
Lets’s look at some challenges small business owners face in 2020 and are their expectations.
Make sure the changes you make have a positive impact and be ready to respond to any unexpected challenges. Adapt, overcome and survive, as Bear Grylls would put it.
(SBA Office of Advocacy)
99.7% of employer firms are made up of small businesses.
The success or failure of a small business depends on many factors. The lack of capital, an ineffective management team, and a faulty business model are among the top reasons why most small businesses fail in the first 5 years.
There are an estimated 30.7 million small businesses that are operating within the United States.
(U.S. Small Business Administration, Office of Advocacy)
Small businesses are considered to be the lifeblood of the American economy, contributing towards two-thirds of the net new jobs in the country. According to reports, 44% of economic activity in the U.S. comes from small businesses.
(Small Business Trends)
According to small business statistics, around 40% of small businesses that are operating within the United States are profitable. The same study also indicates that around 30% of small businesses manage to break even, while the other 30% of small businesses end up losing money consistently.
Tools like Grammarly, Google Docs, and LibreOffice will get the job done, without you needing to spend extra dollars on paid software.And now your guide to success is completed! You know the essential small business statistics. You’ve discovered, among other things, just how many small businesses there are in the USA and you have the knowledge and the do’s and don’ts to take yours to the next level.
5. Guidant Financial
7. Sales Force
9. Guidant Financial
10. The Balance SMB
11. The Guardian
13. Chamber of Commerce
15. Small Business
17. Excel Cap Management