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Many people dream of starting their own businesses. They want to be their own boss, set their own rules, and achieve their own goals. While starting a business can seem daunting at first, it is important to remember that it can be broken down into steps.

The first step is to come up with a great business idea. Once you have an idea, you need to validate it by researching the market and testing it out. If your idea is viable, the next step is to create a business plan and start working on your marketing strategy.

Once you have all of these pieces in place, you can launch your business and start working towards your goals. Knowing what’s happening in the small business world can help you better manage your risks and opportunities.

General Small Business Stats, Facts, and Trends

More than 30 million small businesses operate in the US.
The total number of companies in the United States is 99.9% comprised of these.
For every small business that goes bankrupt, more than 1.5 million jobs are created each year. This figure represents 64% of all new jobs created in the United States.
The first year is the most difficult for small businesses, with more than half of them failing.
A whopping 95% of small businesses fail within the first five years, according to Entrepreneur magazine data.
Poor labor quality is one of the most difficult issues you’ll have to deal with when creating a business plan.

 Small Business Industry Stats

Whopping 58% of small-business owners begin their ventures from nothing at all.
More than a third (38 percent) of small-business owners say they bought their company from another small-business owner.
Only 6% of small business owners chose to buy an existing location rather than open a new franchise.
Food and restaurant (11%), business services (11%), health/beauty/fitness (10%), general retail (7%), and home services (7%) are the fastest-growing small business sectors (6 percent ).
There are 31.7 million small businesses, and 3.7 million of them are microbusinesses with one to nine employees, according to the Bureau of Labor Statistics.

Food and Restaurant Sector

Food and restaurant businesses account for 13% of all small businesses.
Since 2014, consumer spending in this industry has steadily increased.
The annual increase was 2.6% in the first year.
In 2025, the lodging and food service industry is expected to be worth $14.8 billion.
Restaurant sales fell by a total of -19.2 percent between 2019 and 2020.
In 2021, a +10.2% increase in total sales is expected.

Retail Sector

Retail accounts for 11% of all small businesses.
With sales falling by 6% to $4.56B as a result of the pandemic, the industry took a hit.
Retail sales in 2021 are expected to rise by 6.6% to $4.86B.
 The retail sector is expected to be worth $5.52 billion in 2026.

Business Services

The COVID-19 pandemic has taken its toll on the industry, with sales down 16% by 2020 as a result.
Only a 0.15 percent growth rate is expected for the business services industry in 2021, which is less than any other industry.
There is a 0.15 percent increase to $1.69 billion in anticipated corporate profit for 2021.
In 2025, the industry is expected to be worth $2.41 billion.

Health, Beauty, and Fitness Services Sector

Small businesses provide health, beauty, and fitness services to 9 percent of all small businesses.
After the pandemic, health services are expected to recover at a rate of 16.6 percent.
Healthcare services are expected to have a market value of $4.32 trillion by 2026.
$14.8 billion is predicted to be the value of the beauty services industry in 2026.
In 2026, the health services industry is expected to generate $38 million in revenue.

Residential and Commercial Services Sector

The small business sector is dominated by 7 percent residential and commercial services.
To date in the year 2019, there were 67,226 franchises serving both commercial and residential customers There were now 68,008 franchises in 2020, an increase from the previous year.
Between 2015 and 2019, the average annualized rate of establishment growth was +1.09 percent.
Between 2019 and 2020, the sector’s establishment growth rate rose by 1.14 percent.

Small Business Owner Demographic Stats

There is a huge disparity between the number of minority and female-owned businesses and those owned by white men.
Over the past two decades, the number of female-owned businesses has increased by 114 percent.
These two decades saw a 0.02% decrease in the revenue share held by women-owned businesses
There is a significant percentage of business owners who have no formal education.
It is more common for businesses owned by people of color to have trouble securing outside funding.

Gender Small Business Statistics

At least one woman owns, controls, and runs at least 51 percent of US businesses, according to various estimates.
Nearly 9 million people are employed by these companies, which generate $1.7 trillion in revenue annually.
The number of businesses run by women has grown by 114% in the last two decades.
Women-owned businesses make up 39 percent of all businesses in the United States. In the private sector, women-owned businesses employ only 8 percent of the workforce, and they account for only 4.2 percent of total revenues.

Race Small Business Statistics

At least one and possibly more 44s own, control, and operate at least 51 percent of US businesses, according to current estimates. Only 5% of Black people in the United States are self-employed, according to a 2018 census report.
Because of the lower likelihood of attracting outside investment, people of color must rely on savings from friends and family.
In order to get business funding, 17.6% of African-Americans in the United States use personal credit cards.
White small business owners account for 3.8% of the US labor force, followed by Asians at 2.5%, Hispanics at 1.6%, and Black Americans at 1.1%.

Age Small Business Statistics

At least one and possibly several 44-year-olds own, control, and operate at least 51 percent of the businesses in the United States. Many start-up business owners are in their 40s and 50s.
Between the ages of 30 and 50, startup SMB owners are most likely to succeed.
The likelihood of a successful start-up diminishes with age.

Degree in Small Business Statistics

At least one and possibly several 44-year-olds own, control, and operate at least 51 percent of the businesses in the United States.
Only 44% of self-employed business owners hold a bachelor’s degree or higher.
One-third of small business owners have taken college courses but have not completed them.
A GED certificate or a high school diploma was held by 20 percent of those surveyed.
10% of self-employed entrepreneurs did not finish high school.
Men, whites, well-educated people, and families with two parents who earn a lot of money tend to be the most common characteristics of a successful entrepreneur, according to the research.

Income Small Business Statistics

At least one and possibly more 44s own, control, and operate at least 51 percent of US businesses, according to current estimates. 
The average annual revenue for small businesses with no employees is $46,978. 
Owners of small businesses bring in an annual salary of $71,813 on average.
Most small business owners make less than $100,000 a year, according to the Bureau of Labor Statistics.
Female small business owners made an average of $130,000 in 2007 compared to male small business owners who made $570,000, more than four times that amount, in 2007.
The number of small businesses with revenue between $1 million and $2.49 million but no paid employees rose by 1.6% in 2016.

Women-Owned Businesses Stats 

After the COVID-19 pandemic, 77% of female business owners expect their businesses to survive, according to a survey by 2021 Small Business Trends Alliance (SBTA).
One of the highest percentages of women-owned businesses in any race segment is 46 percent among black entrepreneurs.
Advocacy and marketing (24 percent), cash flow (17 percent), employee retention/recruiting (15 percent), benefits provision and management (14 percent), and administrative tasks (13 percent) are the top challenges that female entrepreneurs face aren’t related to COVID.
Cash is expected to be the primary source of funding for 44% of female-owned businesses, followed by ROBS 15%, family and friends 13%, an SBA loan 7%, a line of credit 7%, an unsecured loan 5%, an equipment lease 3%, and other 6%.

Minority-Owned Businesses Stats

Eight million small businesses in the United States are thought to be run by people of color, according to current estimates.
Hispanics make up 41.25 percent of monitory owners, African Americans 32.5 percent, Asians 27.75 percent, and Native Americans 3.4 percent. 8.7 million people are employed by businesses owned by minorities, according to estimates.
Social assistance and health care make up the majority of minority-owned businesses, accounting for 37% of all such businesses.
Investments in minority-owned firms are halved compared to those in businesses owned by people of color.

Small Business Employment Stats 

Small businesses create 1.5 million new jobs every year.
Small businesses account for 64% of all new job creation.
More than 37% of small businesses use outsourcing to increase productivity. Between two and five employees make up the workforce for 41% of small businesses.
The sector is dominated by small businesses with fewer than 100 employees.

Small Business & Marketing Stats 

Ninety million entrepreneurs use Facebook to spread the word about their company and its wares.
If customers have a bad experience on a website, 88% of internet shoppers will never return.
Adding a blog to a company’s website has been shown to increase lead economic activity by 126%. In the event that you [don’t have a blog? Figure out how to begin a blog]
Eighty percent of small businesses don’t see the value in investing in content marketing.
Long-term social media marketing campaigns and boosted posts are examples of paid advertising used by 75% of small businesses.

Small Business & Social Media Stats Small Business Financial Stats 

Sixty-four percent of the small firms we surveyed said that social media played an important role in their marketing strategies.
Seventy-three percent of marketers rated the success of their social media marketing activities as “very” or “extremely.”
Investing in social media grew by 63% among small firms this year, with a concentration on mobile.
Instagram is used by 60% of consumers to learn about new brands.
In comparison to businesses that publish 5 times or fewer per month, those with less than 10,000 followers on Facebook will see a drop in clicks of 60% for every 60 or more posts they make each month.
More than eighty-six percent of small businesses cite Facebook as their primary social media advertising tool.

Small Business Financial Stats

It was predicted that credit would grow by 14% in 2020.
More than one in four new business owners prefer to use their own money instead of borrowing from banks or other financial institutions.
A small business owner’s biggest challenge is managing their company’s cash flow.
The typical loan is for $107,000. At the end of 2020, 91.9 million small businesses received loans totaling $750 billion.

Small Business Revenue Statistics

28 percent of small-business owners say that cash flow is their biggest challenge.
Small businesses are estimated to pay an average effective tax rate of 19.8 percent.
In 2017, 97% of importers and 98% of exporters were small businesses.
Guidant Financial and Lending Club conducted a survey of small business owners and found that 78% of them thought their company was a success.
During the period from 1998 to 2014, the share of small businesses in the US GDP decreased from 48 to 43.5 percent.

Small Business Lending Statistics

56 percent of small business entrepreneurs use their own savings or get loans from family and friends, even if they have a good credit score. 
 Profits and assets, bank loans, credit cards, and home equity are major sources of capital expansion.
A record low of less than 2% applies to small business default rates right now. 
 Fixed assets and equipment are two common uses for small business loans.  
Only 0.7% of new venture capital funding applications in the United States are approved.

Small Business Technology Stats

56 percent of small business entrepreneurs use their own savings or get loans from friends or family to get their business off the ground. 
Eighty-four percent of small businesses use at least one digital technology to provide information to customers.
80% of companies use at least one online platform for advertising and digital marketing to communicate with suppliers and customers.
Nearly seventy-five percent of small businesses have adopted digital platforms.
31 percent of SMBs prioritize CRM software, followed by financial software, and then technology services. Hardware will account for 35% of small businesses’ annual technology budgets.

COVID-19 Impact on Small Businesses

56 percent of small business entrepreneurs use their own savings or get loans from friends or family to get their business off the ground.
 When A small business’s workforce will have to be laid off or furloughed by 27 percent in 2020.
29 percent of small businesses have been able to retain all of their employees during the pandemic.
The COVID-19 pandemic had a negative impact on 83.5 percent of businesses in the food service and lodging industries.
4 percent of small business owners will benefit greatly from government aid.
A majority of small business owners (56%) believe that it will take at least six months, and possibly a year, for the economy and business climate to return to normal.

Small Business Growth and Survival Stats

56 percent of small business entrepreneurs use their own savings or get loans from friends or family to get their business off the ground.
 When Small businesses benefit from having at least two founders, each of whom is a business developer and one who is an expert in their field.
It is more likely for small business owners to succeed if they have previously failed.
Your business is less likely to fail if you focus on providing a service rather than a tangible product.
A company’s chances of success increase if it places a high value on technology investments.
More and more small-business owners are optimistic, according to the National Small Business Association (NSBA).

Small Business Failure Stats

56 percent of small business entrepreneurs use their own savings or get loans from friends or family to get their business off the ground. 
When 82% of small businesses fail as a result of insufficient cash flow, which is often the result of poor financial management.
Every month, approximately 543,000 new businesses are founded.
20% of small businesses fail in their first year of operation.
After two years, the failure rate drops to one-third, and after five years, it’s half.
It is the second most common reason for a small business to fail that there is no market for its products or services.

Final Thoughts:

Businesses all over the world can expect a lot from the years 2020 and 2021.

It’s been a rough few months, but data and statistics aren’t swayed by emotions and simply tell it like it is.

When you have the right information at your fingertips, you can make better decisions for yourself.

To get the most out of it, you need to know how it influences your business decisions and how you can use that knowledge to your advantage when creating a business plan or growing an existing one.

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