Main Characteristics of Small Businesses

small businessThere is no doubt that every other business that is in existence started off as a small business. Starting small therefore is an aspect that has to be considered for business set up. Small businesses regardless of their nature will always have certain aspects in common. This are basically considered as small business characteristics that are key for the growth and stability of the business.


One of the main features of small businesses is that they always display their ability of being independent. Since most of the businesses are locally oriented, they tend to be self sufficient in the sense that they have all that they need for their operations without depending on any other external party. It should also be noted that this type of businesses will derive its motivation and success from its own departments. When the departments are lagging behind, then there Is no doubt that the business will either fail or stagnate.


The other thing that characterizes small business is its size. In most cases, when the business is starting off, the company is considered as small not only in terms of the buildings and facilities but also in terms of the number of employees. Most small businesses will have few employees who are very important and crucial to the establishment and growth of the company. It’s only after expansion that other employees are brought in.

Labour intensive

Since the business is in the growth stage there is a tendency of people working extra hard to ensure that they set goals are achieved at the end of the day. In most cases, delegation of duties is limited as there is practically no person to do the work. You will find that most of the time, it’s the directors who do the work by themselves thus in this businesses, there is maximum use of a person’s potential.

Firm age

Many of you will attest to the fact that for a business to be categorized as being small, the number of years it has been in existence matters. Most of the small businesses have existence for five years or less. By the time the five years elapse, most of the companies’ seize to be small as they are usually grown in size and numbers.

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