What exactly is a “small” business? The Small Business Administration uses employee size and annual sales receipts to determine which businesses are classified as small.
According to the SBA, a small business is typically one that has up to 500 employees, yet in certain industries the SBA still considers a business small if they have 750 to 1,000 employees.
Just take a look at these industries and what the SBA considers “small” business based on the number of employees.
• Merchant Wholesalers with up to 100 employees,
• Drilling Oil & Gas Well Operations with up to 500 employees, and
• Manufacturers can have between 500 to 1000 employees and are still classified as small businesses.
The SBA may also consider a business small if it has average annual sales receipts between $750,000 - $5,500,000. Again, it depends on the industry. The SBA also considers the following industries, “small” business if they have revenue below:
• $18M for a Janitorial Service,
• $20.5M for Security & Patrol Service providers,
• $27.5M for staffing companies, and
• $27.5 M for Freight Transportation Operations.
Businesses that employ close to 500 employees and make anywhere between $750,000 and $28 M a year may be deemed small by the government, but these are not small in scale to the families and local economies they support.
With the SBA loan allotment reaching its max for the year, and banks shying away from working with “small” businesses, where are these companies to turn when they need to secure financing?
Here’s the good news. Invoice factoring is a fast financing solution that uses a company’s receivables to create cash flow without creating debt.
So, if your “small” business needs an infusion of fast cash, then give Universal Funding a call at 800-405-6035 or visit us on the web at www.UniversalFunding.com.
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