When is a Business No Longer Considered Small?

When is a Business No Longer Considered Small?

You’ll often hear the terms small, medium and large when describing the size of a company. It is fair to assume that a Mom and Pop candy store at the corner of a street is a small business. It is also fair to assume that an automobile manufacturer or major financial institution is a large business. Medium-sized businesses may be a little more difficult to describe, other than they fall somewhere in-between.

Did you know, however, that there are sources that can better define a small, medium and large business by its product category, number of employees and annual sales?

The Small Business Association (SBA) for example, determines the size of a small business on such criteria. It also has an entire set of codes for companies in various categories to decide whether a business is considered “small”. This can affect a variety of business eligibility requirements including loan qualifications. Based on such criteria, some companies can have incomes in excess as $40 million and still be considered a small business.

The start is to find the government key which determines the category your business falls into. This puts you in a pool of businesses you are competing against for government assistance. The U.S. Census Bureau has a list of codes and sub-codes that can help you determine whether your business is “small”.

Outside of the SBA definition, the size of your business will impact what it pays for insurance. The larger the company, the more income it produces and the more employees it has, the more risks it is exposed to. This will translate into the need for greater coverage.

Most companies grow. They grow from maybe a single proprietor to a partnership to bringing in investors. They may even become publicly traded someday. Along the way, it’s insurance needs will change.

While the SBA may have specific guidelines according to government assistance levels, most have a more casual approach to how they view their business. If you are building your business, build your loss-prevention strategy at the same time. We can help.

Contact one of our independent insurance agents to discuss where your company is, and where you see it going. They can help design an insurance program you can afford, and one that will help facilitate the growth of your business.


Do you have questions about your insurance? Find an insurance agent near you with our Agent Finder

Search All Blogs

Generic filters

Buzz Your
Insurance Agent

Search for a local agent with our agent finder map.

Agent Finder

Want to learn more about our blog writer?

Read more about KayLynn's background.

Click Here

Search All Blogs

Generic filters

Read More Blogs

The Wanderer’s Playbook: The Art of Traveling on a Budget

A practical guide to finding and saving money on travel adventures.

The Entrepreneur’s Toolkit: From Startup to Success, Insuring Every Step of the Journey

A phase-by-phase guide for entrepreneurs on the essential business insurance policies they need.

Beyond a Payout: How Life Insurance is a Living Financial Tool

A guide to how life insurance can be a living financial tool, with a focus on its cash value component.

The Driver’s Playbook: How to Maximize Your Auto Insurance Benefits

A playbook for drivers, revealing key policy benefits and strategies to get the most from your auto insurance.

Beyond the Big House: Uncovering the Hidden Value in Home Insurance

A deep dive into the valuable but often overlooked components of a home insurance policy.

The Thrill of the Grill: A Masterclass in BBQ Perfection

An ultimate guide to mastering grilling and barbecue, with tips, techniques, and delicious recipes.

The Entrepreneur’s Armor: A Guide to Protecting Your Business

A crucial guide to business insurance, covering essential policies and strategies for entrepreneurs.

The Gift of Security: A Simple Guide to Life Insurance

An easy-to-understand guide to life insurance, explaining policy types and a simple way to calculate your needs.

Hitting the Road Safely: Understanding Your Auto Insurance Policy

A simple guide to auto insurance, explaining coverage, premiums, and tips for finding the best policy.

The Homeowner’s Handbook: Protecting Your Property and Peace of Mind

A clear guide to home insurance, covering policy types, inventory tips, and how to save money.