NEWARK – Contrary to what you may think, small businesses are huge business. Statistics are a bit dated but according to the Small Business Administration (sba.gov), in 2018 there were 30.2 million small businesses in America.
And, again according to the SBA, “Contrary to the popular opinion that the majority of new businesses fail during the first year, the Small Business Association has stated that only 30 percent of newly founded businesses are likely to fail within the first two years. Additionally, 50 percent of small businesses are bound to survive five or more years, and 66 percent would endure throughout the first ten years.”
Interestingly, the definition of a small business may not be as straightforward as you might think.
“That’s one of those things that depends on who’s looking at it,” explained Ed Lukco, a local business consultant and economics faculty member at Ohio Dominican University. “For the most part, anything under 500 employees qualifies as a small business. Some will do it on the basis of revenues and that can be anything less than $1 million to less than $5 million. It just depends on who you’re talking to.”
Jennifer McDonald, president and CEO of the Licking County Chamber of Commerce, agreed. Sort of.
“I’ve never found a true definition of small business,” she said. “However, at the Chamber we quantify a small business as 1-50 employees to qualify for our Small Business Council. If you pull the most recent NAICS code for Licking County (which is from 2017) there are 2,800 businesses that fall into that category.”
In any case, how important are small businesses to the community? And what role do they play to keep Licking County economically healthy?
“It’s significant,” Lukco said. “In general, they have most of the employment in spite of what everybody thinks about the big multi-nationals employing tons of people. Small businesses are where the employment resides, and it’s always been that way. And that’s where employment grows as well. It doesn’t grow in the big multi-national companies. It grows with small mom and pop businesses to deal with the growth they experience. It’s always been that way.”
“I would say small family-owned businesses are the backbone of local communities,” assessed the Chamber’s McDonald. “Family businesses typically allow consumers and community members the opportunity to get to know the management and build relationships, which, in turn builds trust and consumer loyalty.”
“Small business is the blood of life for our community, in my opinion,” agreed Mike Shonebarger, owner of Newark-based Command Carpet Care. “I know I’ve thrown a lot of my business and other recommendations to other small businesses, and I know a lot of people who’ve done the same. Small businesses have got to stick together.”
“Actually,” McDonald continued, “family businesses may have some advantages over other business entities in their focus on the long term, their commitment to quality (which is often associated with the family name) and their care and concern for their employees.”
Plus, she added, “Local businesses tend to support other local businesses. Many times, a local business will deliberately patronize other local (and many times family-owned) businesses to create a thriving local economy. Bolstering sales of their friends and neighbors creates strong community bonds and collaborations and keeps money in the community.”
It all adds up to what Bonnie Buchanan, professor of business management technology at Central Ohio Technical College, calls a “feeling.”
“You’re experiencing a feeling with a small business that you don’t get with a big box store,” she said. “I will drive 5 miles out of the way to go to a local store instead of going to a big box store because of the feeling I get.”
“We have an ongoing relationship with my local convenience store,” Buchanan continued, “We go there because of the way we get treated. We’ve watched their kids grow up. We’ve watched them go to college.”
“I love small, family-owned businesses,” Buchanan summed. “I think they’re vital to the economy. It’s the tradition they pass on. I think it’s the feeling.”