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By Emma Sturgis

It can be challenging to keep up with the trends of small businesses. Entrepreneurs handle multiple complex duties in their business, and researching and analyzing economic trends regarding small businesses isn’t always a top priority.

For you to stay on top as a small business owner, you need to understand the reliable statistics of small businesses. Knowing the latest stats of the industry and how other successful establishments have flourished can stimulate your small enterprise’s growth. Here are some of the best stats about small enterprise trends and operations:

How many small businesses are in the U.S?

Statistics have shown that the total number of small businesses in the U.S. is close to 30.7 million. According to the SBA report, that figure represents 99% of all registered companies in the U.S.

Small business has a simple definition, as indicated by The Small Business Administration (SBA). It’s a firm with fewer than 500 employees. This statistic reveals that many popular startups in the U.S. are small enterprises.

Small businesses and coronavirus

Uncertainty may hurt small businesses, as the current pandemic has made abundantly apparent. According to recent research on small and medium-sized enterprises, about 31% of small firms in the United States have ceased operations during the crisis (Facebook, 2020).

In March alone, nearly 70 percent of small businesses had closed in the U.S. Over 60% of the closure were a result of government regulations to curb the spread of the virus while 40% of closed were caused by hard economic times as a result of the pandemic.

Why do startups fail?

Lack of market demand is the main reason leading to the failure of startups. An estimated 42% of small businesses collapse for lack of suitable market (CB Insights, 2019). So, before you venture into a small business, you should consider the demand for what you offer in the marketplace.

Businesses can also fail for lack of finance. In the U.S. alone, an estimated 29% of startups have ceased to function due to lack of sufficient funds. Other causes of business failures include lack of right team or workforce, competitors’ dominance in the market, and unfavorable products.

The challenges

The top challenge that affects a small business is the low-quality workforce. Through an interview conducted by CNBC, 52% of people interviewed cited low labor quality as the main challenge of an existing small business.

Thus, a blend of customer-based reasons, low-quality workforce, and insufficient resources lead to business failure. That’s why it’s advisable to work with expert consultants, like a Netsuite solution provider, to help you build the blocks of a startup.

These statistics will help you make effective decisions while striving to become a successful small business owner. The underlying challenges can be unpredictable, but understanding existing trends will make you strong enough to face difficulties in a more aggressive way.

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Emma Sturgis is a freelance writer based out of Boston, MA. She writes most often on healthand education. When not writing, she enjoys reading and watching film noir. Say hi onTwitter @EmmaSturgis2.