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How big is a small business? There is no single definition, and any person you ask probably has their own idea.
The SBA publishes a list of their definitions of “small business” by industry and uses either revenue or employees. A business can be small with revenues up to $2.5 million, or up to $47 million depending on the industry. For industries that use headcount as the metric, a small company has 100 up to 1500 employees, again depending on the industry.
Why does this matter? I can think of two reasons:
- Most people have no idea how much the definition varies. I see articles in national news organizations that think of “small” as $100m or 500 employees, while other business owners may think $10m or $20m is small. Or 100k.
I hope this helps people (1) understand how differently people think of and, (2) gives people some idea of what a common definition might look like. - These definitions affect government contracts that businesses are eligible for.
On this page/post, you can search that list by industry or NAICS code to see what the definition of “small,” is, either by gross revenue or employees, whichever measure the SBA uses.
A random entry is below.
Search by Industry or NAICS Code:
Limit:
Average Limit for Sector:
Variance from Sector Average:
Average Limit for Subsector:
Variance from Subsector Average:
The other thing this page demonstrates is how quickly AI will and is changing tech and data analysis: I found the data source and had the idea, but the code was generated entirely by ChatGPT. I am really blown away by gpt-4o, the context window is so much better. While you could put in tens of thousands of words (tokens) with gpt-4 the model still got lost quickly and you’d need to start a new chat.
For this, I had multiple iterations and it never lost track of where we were, and always outputted the entire code at once. (YES! Can you believe it?)
Data is loaded directly from the SBA API feed at https://api.sba.gov/naics/naics.json
Find the code for this post at https://jonathanaddington.com/how-small-is-small-code/
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