Small Business Sucess

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CHAPTER 1 –INTRODUCTION

Background of the Study

In the past 60 years, the major theme in business has been the rise of entrepreneurship around the globe. An estimate of half-billion people worldwide is trying to venture to a new business every year. At the early 70’s, as corporate profits had begun to decline, entrepreneurs have started small business and created entirely unique industries such as Steve Jobs of Apple Computer and Bill Gates of Microsoft. Managers also arrived to the realization that having bigger business is not necessarily better and flatter organizational structures of newer companies advantageously gave them the capacity to respond more quickly to changing desire of the customers, thus making them more flexible in changing their products and services. The 1980’s, “merger mania” brought debt to newly expended businesses and left them at the disadvantage that often followed by bankruptcies and layoffs in domino effect, “downsizing” and outsourcing during the 1990’s enhance the productivity of comparativeness of their own and new business perform the work that large business no longer do (Hatten, 2009). According to the U.S. Small Business Administration (SBA) Office of Advocacy, there was an estimate of 25.8 million businesses in the United States in 2005. This includes more than 9 million Americans who operate part-time enterprises and another 12 million involved in some form of entrepreneurial venture. The BSA notes of contribution of such businesses to the US economy, reporting that small firm comprises 99.7 percent of all firms with employees, employ more than half of all private sector employees, account for 45 percent of total US private payroll, private gross domestic product, employ 41 percent of high-tech employees, represent 97.3 percent of all exporters, produce 13 to 14 times more patents per employee than large firm and, are 53 percent home based and 3 percent franchises....
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