The Flexibility and Significance of Today's Small Businesses
Greg Goetzman, 58, isn’t much of a gambler, but when COVID-19 sent people home in March, he placed his odds on a new small business model: assigning half his staff to work from home permanently.
With nearly 100 employees, this was a huge shift for the California-based financial consulting firm. Goetzman realized that success would hinge on his ability to carefully outfit employees with equipment and systems to seamlessly communicate. Team members appreciated the flexibility, and this large-scale investment is paying off:
“I haven’t seen a drop in work quality,” Goetzman said, “We are fortunate that our consultants are flexible and accustomed to working from different locations, therefore, they were prepared and there were no issues transitioning to working remotely.”
The novel coronavirus forced strategic business pivots and rapid innovation for many companies, but small businesses have certainly been forced to improvise. And that may be a good thing. Goetzman says that, while revenue is down slightly for the year, the overall workload is increasing. And the new business model will be tweaked as they go:
“We are changing the way we do business,” he said. “It’s going to be some blend of working from home and work from the office. We maybe had 20% of our employees working remotely before COVID. It’s closer to 100% now. I think we will end up somewhere in the middle of that.”
Four Remarkable Small Business Facts
While big business often dominates headlines, small businesses play a vital role in exporting products, creating jobs, and producing wealth for thousands of families.
Here are four remarkable facts about the big impact of small businesses:
1. Nearly all are small
Small businesses make up the vast majority of companies in America, comprising 99.9 percent of all firms.
Out of 32.5 million businesses, over 30 million are small!
2. Half are home-based
A home-based business may have activity outside of the home, but it is operated primarily from the home.
According to the SBA statistics, 50% of small businesses are home-based, including 60.1% of firms without paid employees. The most common type of these businesses is sole proprietorship.
3. Small Businesses are nimble
Small business stats show that most businesses in America have fewer than 500 employees.
Those businesses with fewer than 100 employees account for 98.2 percent, and those with fewer than 20 employees account for 89 percent of all businesses in the country.
This flexibility certainly helps the economy – according to the small business association, small companies create 1.5 million jobs annually and account for 64 percent of new jobs created each year.
4. Many are greatly impacted by uncertainty
Small businesses are more vulnerable to change, especially when they are young.
Only 50% of small businesses last beyond five years, and during the pandemic, small firms have been hit particularly hard. Nearly 31% of small businesses in the U.S. are currently not operational, and 28 percent of small business owners say cash flow will be their biggest upcoming challenge.
Making People the Priority
This is a hard season to be an entrepreneur.
According to the National Association of Independent Business, more than half of small businesses could be in danger of failing if coronavirus-related restrictions continue, and more government aid isn’t forthcoming.
That’s one reason it is so important to prioritize individual connections and communication that takes place “off the screen.”
Goetzman says COVID-19 has prompted him to return to an old habit, writing appreciative letters to clients in longhand:
“It gets a personal message across in a way that an email or a phone call or a message may not,” he said. “It’s you taking the time to really give some deeper thought to the business relationship and what it means to you.”
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