Page 158 - Introduction to Business

132 PART 1 The Nature of Contemporary Business

EXHIBIT 4.4 Job Opportunities
Percentages of New Jobs Created Perhaps the most compelling reason for the importance of
by Different-Sized Firms small business firms is that they provide jobs that people want.
Does being your own boss sound good to you? Tired of the job
you are in and want to design your own job? Have a great idea
500 or more for a business and want to reap the profit, rather than let some-
employees one else gain that profit? Want to work at home or in an envi-
24%
ronment that you find attractive? Is there a way to combine
Fewer than 20
employees family and business in your life? Are your close friends inter-
48% ested in working together? Do you see unmet needs in your
20 to 499
employees community and wish someone would do something about
28%
them? If you are a woman or member of a minority group, do
you want to make your own future, rather than be subject to
Source: U.S. Small Business Administration, Office of Advocacy, societal pressures that seem unfair to you? These questions
Washington, DC, 1997. Based on data gathered from the U.S.
Census Bureau. express the motivations for many people who start, purchase,
or join a small business.
The U.S. Small Business Administration estimates that there are over 25 million
small businesses in the United States. Together, they account for at least half of the
jobs and total production of the nation. And, most new jobs are created in the small
business sector (see Exhibit 4.4).
Computer and telecommunications technology is changing the way people work
in small businesses, and its use in small business is growing (see Exhibit 4.5). For par-
home business A small business that is ents taking care of children, a home business can provide professional opportunities
operated out of a household address, without sacrificing family values. Many larger firms are finding that they can plug into
rather than out of a business office or a network of small business professionals in their region without adding permanent
factory
employees to their payrolls. Disabled persons are also finding that they can fit into this
remote business model. No longer is there an absolute need to get to a physical loca-
tion and be at a desk. E-mail, Internet chat rooms, video conferencing, computers, cell
phones, and pagers are connecting people to work on business problems without the
necessity of everyone being at one place at one time. Also, these allow small niche
businesses to rapidly adapt and change to the needs of society.

EXHIBIT 4.5
Small Office and Home Office Information Globalization
Technology (IT) Spending
Another trend that is changing the role of small business is globaliza-
tion. The 1990s witnessed unprecedented growth in international
80
trade.While large business firms have surely been the main benefici-
70
aries of increased trade between countries, small businesses are
Dollars (in billions) 50 firms to get involved is by becoming part of the supply chain of larger
60
learning how to participate in this growing activity. One way for small
firms. As large firms expand their reach across national boundaries,
40
they stretch their human and physical resources and increase their
30
demand for the incremental contributions of small firms. Alterna-
20
ketplace. Networking is a popular way for small businesses to import
10 tively, small firms can link up with other small firms in the global mar-
and export goods and services. For example, a small candy retailer
1997 1998 1999 2000 2001 2002
could start importing candies from small, foreign producers to
Year
expand their product line and increase sales. Also, many small e-
Source: U.S. Small Business Administration, Office of Advo- businesses operating on the Internet can market their wares around
cacy, “Small Business Expansions and Electronic Com-
merce,” report by staff, Washington, DC, June 2000. Data the world nowadays. Only twenty years ago, this type of global reach
gathered from IDC. was simply impossible for all but the largest firms in the world.

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