There are an estimated 23.7 million businesses in the U.S. Excluding those in the start-up phase and larger businesses, Mintel estimates there are nearly 15 million established small businesses (fewer than twenty employees) in the country. The small business owners group now includes growing segments of women, Hispanics and even aging Baby Boomers. The pipeline is filling with Internet-oriented businesses, and new high-tech businesses are again being started, and the interest in stem cell research is bringing biotech into the mix, changing the portfolio of U.S. small businesses.

There are an estimated 23.7 million businesses in the U.S. Excluding those in the start-up phase and larger businesses, Mintel estimates there are nearly 15 million established small businesses (fewer than twenty employees) in the country. The small business owners group now includes growing segments of women, Hispanics and even aging Baby Boomers. The pipeline is filling with Internet-oriented businesses, and new high-tech businesses are again being started, and the interest in stem cell research is bringing biotech into the mix, changing the portfolio of U.S. small businesses.

All small businesses keep a watchful eye on the bottom line, and base nearly all of their decisions on the “revenue up, costs down” mantra. Beyond that, the biggest decision that a small business faces is whether or not to grow, how much to grow, and how to finance that growth. Debt or equity? There are tradeoffs, and there are plenty of financial institutions ready with answers in the form of products and services tailored to every business segment.

The full-service bank still has a major role in small business operations. It is still the one place that offers the convenience of one-stop shopping for all or most of a start-up’s needs, plus the personal touch of a small business banker. Even with increasing ability to shop for and apply for financial services online, having a person to help navigate the complicated financial landscape is still valuable to the busy business owner.

To the extent that banks and other financial services companies can alleviate the needs for manpower, they become valuable partners to small business. The sophisticated reporting and management tools offered either as stand-alone products or as part of a business account can make the difference between having to hire financial staff and not. And, for a small business, having to hire just one more person can mean the difference between success and failure.

Established small business

The Office of Advocacy defines a small business as “an independent business having fewer than 500 employees.” For the purpose of this report, Mintel also considers a small business to be a business with fewer than 500 employees, and has conducted its exclusive commissioned research with that size as a guideline for its respondent base.

This report includes established small businesses, which have been in business for more than five years. This report does not include start-up small businesses, which have been in business for less than five years. Start-up small businesses are examined in Mintel’s Small Business Finance Volume 1—U.S., May 2005 report.