Defining A Small Business

WNPR is beginning a year-long focus on small business with its new Small Business Project. 

 

Politicians pay a lot of lip service to the needs and the importance of small business, but they rarely define what they’re talking about. So we thought we’d start there, and try to find out - exactly what is a small business? WNPR’s Harriet Jones reports.

 

All over the state, there are small businesses just like this.

 

“Come on in—hi how are you—I’m good, I saved you some apple bread in case you’re hungry….”

 

“My name is Jennifer Chominski, and I am the owner of Gracie Mae’s Kitchen LLC.  I started the business three years ago with my mother. And my mother and I were very proud of ourselves that we spent an entire day to make a dozen pies. And now we’ve grown to over 200 pies a week during the summer time.”

 

Gracie Mae’s Kitchen in Griswold is what you might think of as a picture-postcard small business. But did you know that this is also a small business?

 

“I’m Doug Rose, President of Aero Gear company in Windsor, Connecticut. We produce gear boxes for jet engines and helicopters mostly. We’re about 140 employees. Of course we started out as a local manufacturing company to provide product for Pratt & Whitney, but we’ve expanded. We have Boeing as a customer and General Electric as a customer and we have customers overseas now as well.”

 

Connecticut plays host to thousands of incredibly diverse enterprises that go by the name of small business. So what is a small business?  It depends on who you ask.

 

“Three million in sales and a hundred employees or less.”

 

“It can be as big as 45 million, it can have as many as 500 employees.”

 

“When you’re looking at Connecticut, you’re probably looking at companies that have a hundred or fewer employees.”

 

“In our state law, small business is defined as a company that has fewer than 50 employees.”

 

That’s John Lobon of the Connecticut Development Authority, CBIA economist Peter Gioia, and the current and future Secretaries of the State, Susan Byciewicz and Denise Merrill.

 

In fact, the federal government has one set of definitions for a small business, and the state has another, so deciding if you qualify, and for what, can be complicated.  Annie Chambers administers loan programs for SECTER, the Southeastern Connecticut Enterprise Region.

 

“We work with the federal parameters for small businesses and I’ll have to tell you it’s like a 55 page document. Some are restricted by income, some are restricted by number of employees and some have no restrictions.”

 

In fact she says it’s likely that in her region of the state perhaps only Pfizer, EB and the casinos would NOT qualify as small businesses.

 

“I think a lot of small businesses think, oh, I’m not eligible for small business financing because I’ve got 200 employees, or I, you know, generate 10 million in sales—but they are.”

 

But on the other end, small business can also be very very small. Steven Lanza is editor of the Connecticut Economy, UConn’s quarterly on economic issues.

 

“Those who are even self-employed, just working for themselves, I would argue that’s a small business. Whether they be, eBay sellers, independent contractors for companies that they worked for in the past, or you know, webpage designers, or whatever it might be, there’s lots of them out there in Connecticut and it’s one area where we really do see some robust growth.”

 

If these entrepreneurs don’t form a business entity, they may not even register in state numbers. And there’s the nub of the problem when you are defining a small business. With a sector that ranges from fruit pies to aerospace gearboxes, and from one employee to 500, designing services and effective policies to encourage this engine of our state economy is far from the simple slogan-making we sometimes hear on the stump. 

 

For WNPR, I'm Harriet Jones.