A small business is a privately held corporation or a sole proprietorship. It has fewer employees and earns less yearly revenue than a large business, but the exact definition varies from industry to industry. For example, the agriculture industry classifies small businesses as those with less than $750,000 in annual receipts on average, while the construction industry’s maximum is $36.5 million in average receipts annually.
It’s important to define exactly what small businesses are in order to protect and promote them. The government usually grants special subsidies and benefits to help the little firms compete against the big market-share holders in their industry. They can also generally get bank loans sooner and more easily.