Nine out of every ten firms in the United States is a microbusiness – who knew?!
And, microbusinesses are one of the fastest growing and best positioned business groups to ride the current economic storm. Read Dawn Rivers Baker’s excellent article on 5 Key Microbusiness Trends for 2009 for more on this.
What is a Microbusiness?
Microbusiness is definitely the sector to watch in 2009. But what is a microbusiness?
Finding a solid definition is somewhat of a free for all. Below is the nearest we have to an official definition, as well as an unofficial definition:
- Official Definition – Advocate groups typically define microbusinesses as an organization with less than five employees, small enough to require little capital ($35,000 or less) to get started.
- Unofficial Definition – Microbusiness owners are the “…people who refer to themselves as soloists, independents, consultants, craftsmen, artists, musicians, freelancers, free agents, and self-employed people. The majority of these companies are one-person enterprises …operate out of their homes; and many …have part-time help from a family member or friends.” (Courtesy of Lloyd Lemons in his Microbusiness Defined article).
Combine these two definitions and you have a business group that is better structured than its larger corporate brethren to endure economic crises, as Dawn Rivers Baker states, “thanks to a lean operating style and creative business model(s).”
When you also take into consideration socio economic factors such as increased unemployment and a growing trend toward outsourcing to consultants and freelancers, the attraction and opportunity for microbusiness growth becomes clear.
Planning for the Growth of Your Microbusiness
If you’ve ever considered becoming a home-based business owner, or dreamed of opening up your own “mom and pop” business – you will likely fall into the category of microbusiness owner. As such, you are still a business owner and will benefit from planning and managing your venture much in the same was as any business owner.
Here are a few key operational, regulatory, and business development items you should consider as part of your microbusiness start-up or expansion plan for 2009:
Are you Properly Licensed / Permitted? – It’s a misconception that freelancers, consultants or home-based businesses don’t need the appropriate licenses. In fact, every business needs one or more federal, state or local licenses or permits to operate. Licenses can range from a basic operating license to very specific permits. The government has created a very handy tool – Permit Me – that lets business owners easily identify the licenses and permits required for their business.
Register your Business Name (“Doing Business As”) – Again, this is an often overlooked area among microbusinesses. If you choose to name your business along the lines of something like “Accent Accounting Services”, you cannot operate that business under that name until it is officially registered with your local government. Until then the legal name of your business is essentially your given name. Find out how to register your business name here.