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Small Business vs. Large Business — What’s the Difference?

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What’s the difference between a Small Business and a Large Business? It’s all a matter of viewpoint. We could evaluate and compare by the number of employees on the payroll, or by the gross sales or services, or by the net profit achieved, or by the marketing and advertising influence on the consumer’s mind.

1)      Number of employees: Counting number of heads on the payroll does not give an accurate indication of a small business. A person could be a self-employed entrepreneur and work from the dining room table and have a financially successful business. This same person could have no employees, or could have five or six or ten, all working out in the field or in their own homes, or perhaps one or two working on the other side of the table. Their spouse could also be on the payroll, offering  creative talents to the business.

2)      Gross Income: A small business could be in start-up and going in the hole for the first few years. Or, it could be off to a fantastic start and bring in hundreds of thousands of dollars each year. This same business could be the same person working from his home over the internet, or the business could be in a prestigious office building. Gross income or business location, then, is not the best criteria for determining size.

3)      Net Income (or Loss):  Just as Gross Income or number of employees on the payroll or business location do not determine whether an entity is a small business or a large business, Net Income also fails as a criteria. Net Income fluctuates in every business – large and small.

4)      Marketing and Advertising: These leave indelible images in the mind of the public. Yet the full-page ad in the Sunday paper doesn’t really tell the truth about the size of the company. It gives the image of what the company wants you to think.

The Most Valuable Element of Every Business

This leaves one valuable element to evaluate any entrepreneur of any business size: How do they view both their financial potential and their employees? What goes on in their imaginations? In their fantasies?

Does the owner feel superior to those on the payroll? Are the employees compensated the same as the owners would want to be compensated for the same work? Are the employee benefits what the owner would find acceptable for himself or herself?

Financial Potential

What is the financial potential of the company? This makes it small or large! Ask how much is too much to pay for a car? $20,000? $60,000? What would be an extravagant action for the company to take? How much is too much to pay for a business luncheon? Answering these questions will let you know the financial potential of the company is. And no business will be more successful than they allow their employees to be.

Small Business permeates the economy of every country. No matter how big the corporate giants are, the small business person wields a power that can’t be matched, if they only believe in themselves. If they will only dream big! And treat others Big!

Find more thoughts for evaluating size in the Related Articles of Payroll Services for Small Business below.

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