Small Business Association reports that United States has a staggering 33.2 million small businesses that generate $1.5 trillion in annual revenue, demonstrating the entrepreneurial spirit and tenacity of small business owners across the nation.
However, passion, hard work, and the desire for financial independence that motivate many small business proprietors are overshadowed by the fact that a significant 86.3% of them earn less than $100,000 annually, due to the challenges and hurdles they face to keep their enterprises afloat. The revenue-income disparity reflects the severity of the situation.
Small businesses without employees suffer from a disadvantageous position, with an average yearly revenue hovering around $46,978. The magnitude of obstacles faced by such business owners cannot be overstated, yet their contributions to the economy remain unmatched and pivotal.
Let’s get into more detail about Small Business Revenue Statistics, which show you current small business trends.
Overview on Small Business Revenue Statistics
- 86.3% of small business owners make less than $100,000 a year in income.
- Small businesses with no employees have average about $46,978 annual revenue.
- The average sole proprietor earns less 25K in revenue per with net income around $7K.
- The average small business makes 100K in revenue per employee.
- An estimate, 98% of small businesses make no profit in the first years and 10% of them fail.
Average Small Business Revenue
On average, small businesses with no employees have about $46,978 in annual revenue. [2] Regardless of what industry your small business is in, it is possible for you to make a pretty decent living.
Small business revenue isn’t always going to be at the same level from month to month. Sometimes it will go up, sometimes it will go down and sometimes it will stay steady. Whatever the case may be, keep your head up and keep pushing forward. You never know when an increase in small business revenue can happen!
Small Business Revenue Range
| Firm With | Average Annual Revenue |
|---|---|
| 0 employee | $46978 |
| 1-4 employee | $387,000 |
| 5-9 employee | $1,080,000 |
| 10-19 employee | $2,164,000 |
| 20-99 employee | $7,124,000 |
| 100-499 employee | $40,775,000 |
Not all small businesses are created equal. Some will have a hard time getting started, while others will do just fine. The key is being prepared, having proper data in front of you and knowing how to plan for the unexpected.
With that said, some businesses are simply flat out better at generating revenue than others, and sometimes you’ll find a business with low revenue that seems to be thriving based on other measures—like customer satisfaction
Average Monthly Revenue For Small Business
| Firm With | Average Monthly Revenue |
|---|---|
| 0 employee | $3914 |
| 1-4 employee | $32,250 |
| 5-9 employee | $90,000 |
| 10-19 employee | $180,333 |
| 20-99 employee | $593,666 |
| 100-499 employee | $3,397916 |
There are numerous ways to grow income, and although these figures vary widely depending on the industry and region in which a firm operates, it is evident that there are numerous ways to raise revenue. It is your responsibility as an entrepreneur to develop a means to tap into your available cash streams.
No matter whether you choose to partner with a company, develop your technology knowledge, or just make better use of your current employees’ talents, there is a means for you to expand your business and achieve your revenue objectives.
Average annual revenue for small business
| Firm With | Average Annual Revenue |
|---|---|
| 0 employee | $46978 |
| 1-4 employee | $387,000 |
| 5-9 employee | $1,080,000 |
| 10-19 employee | $2,164,000 |
| 20-99 employee | $7,124,000 |
| 100-499 employee | $40,775,000 |
The average annual revenue for small business with no employee makes $44000 per years and with 1-4 employees makes $38700 per year.[3]
Average profit for small business
| Firm With | Average Profit Anually |
|---|---|
| 0 employee | $4,458.41 |
| 1-4 employee | $36,733.03 |
| 5-9 employee | $102,510.77 |
| 10-19 employee | $205,401.22 |
| 20-99 employee | $676,191.44 |
| 100-499 employee | $3,870,256.29 |
The profit calculated based on an average profit margin of 7% and the average revenue data based SBA small business revenue report in 2007.
To make the amount reflect the money business would make in 2022, we have adjusted profit by adding inflation rate.
Annual revenue for new business
The annual revenue for new businesses depend on many factors but an estimate of around $50,000 in revenue and most businesses don’t make any profit in their first year of business, according to Forbes. In fact, most new businesses need 18 to 24 months to reach profitability.
The annual revenue also depends on the industry that is the business and location of the business.
Average gross revenue for small business with 10 employees
The average small business makes $2.1 million dollars with 10 or more employees.
There are wild variances in this data, but $2.1 million certainly sets a baseline for what is possible no matter the average employee number of your company.
If you have some loyal customers and a great grasp on your marketing efforts, there is a good chance that you can pump out some higher numbers here. If there is one thing to take away from this metric it is this – it may be hard work, but it is possible to create a bigger business.
Average salary for small business owner
The average small business owner salary is $66,373 in 2019, according to PayScale data.
Revenue per employee small business
The average small business actually generates about $100,000 in revenue per employee. For larger companies, it’s usually closer to $200,000. Fortune 500 companies average $300,000 per employee.
Average sole proprietor revenue
In fact, when we look at sole proprietorships as a whole, almost seven in ten have an annual gross of less than $25,000. An amazing 15.5 million businesses fall in this category, with average gross revenue of slightly more than $7,000. This is based on IRS statistics released in 2012.
Small business percentage of gdp
The nearly twenty-seven million small businesses in the United States generate about 50 percent of our GDP.[4]
Small business making more than 250000
There are more than 1 million businesses making more $250000 per year.[5]
Average time for new business to make a profit
On the average, new small businesses need 1 to 3 years to reach profitability. [6]
In one study, 82% of businesses that failed cited a lack of cash flow as a factor in their demise.
Companies with a good cash flow are better able to foresee and plan for the future, and they can make sound business decisions without worrying about running out of funds before they can be implemented.
The most effective method of managing cash flow is to keep track of your income and expenses. This will allow you to keep expenses to a minimum so that you can plan ahead of time, while also ensuring that your payments are collected on time. When using software created exclusively for small businesses, many people find that it is much easier to keep track of their company’s financial records.
Final Thoughts
Small companies are the backbone of our economy, providing the great majority of the goods and services we use every day.
As a result, they deserve a great deal more respect and attention than they currently receive. They’re also extremely valuable to the United States economy.
They account for over 65 percent of all new jobs created in the United States, employ approximately half of all US workers, and generate approximately half of all US sales.
We have no doubt that as more people become aware of the importance of small businesses in their everyday lives and the general health of our economy, policymakers in Washington will make a far larger effort to aid this essential sector.
FAQs
What is considered a small business revenue?
Small business revenue is calculated based on the amount of revenue generated by your company before any expenses are deducted from that revenue. This revenue can be found on your balance sheet, which is also referred to as an income statement.
No matter what size your small business is, you must first determine how much money you make over the course of a year, and then how much money you make per month in order to succeed.
You will be able to budget for costs and other expenditures as a result of this.
How does SBA define small business?
Ultimately, the SBA considers two factors when determining small business status: first, the number of employees a business employs; and second, the net worth of the business’s owners. If a business meets either one of these two criteria, it may qualify as a small business in the eyes of SBA.
What is a good revenue for a startup?
According to the Revenue Growth Study by Bobby Martin, found out that the average revenue for startup business is $0 and it reaches 3 million dollars at the end of four years period.
But the figure amounts will always vary depending on the kind of business you have, the industry you work in, and the revenue goals you’ve set for yourself.
However, what we can say for sure is that if you set realistic revenue goals for your business, manage them well, and do your best to achieve them, you’ll be setting yourself up for long-term success.
Which type of startups are most profitable?
According to Startup Savant, the top 20 most profitable startup businesses include online courses, social media consulting, web design, cleaning business, health and wellness business, logo design and many others.
Since the internet is part of life, creating digital products or services might be the best asset for generating high revenue.
Another benefit of creating digital products is that the initial cost of launching the business will be much lower compared to tangible product based business.
Source
1. Census.gov
2. Forbes
4.SBA.gov
5.NFIB
6.SBA.gov
8.Fundera
