There are more small businesses in the United States than most people know. Current estimates are there are 30 million businesses classified as small business. There are more than 57 million people employed by small business owners, making small business an important part of our overall economy. It is estimated small business accounts for more than 60 percent of overall job growth in the U.S.
Geography of Small Businesses
Every region of the United States has small businesses. However, the South and Mid-Atlantic are home to nearly 50 percent of all small businesses while New England and the Farm Belt account for only 10 percent. Keep in mind, by definition, small business is defined as any company employing fewer than 500 employees.
Financing Challenges Associated with Small Businesses
Nearly one-quarter of all small businesses fail to obtain sufficient levels of financing. When you combine this statistic with the decline of banking institutions in the country, this is a sobering statistic. During 2017-2018, 271 banks closed their doors. This means small business owners often had to elect to find alternative methods of financing their businesses.
Impact of Financing on Small Business
Small businesses have always faced financing challenges, particularly during their first few years. Some of the options they have used include:
- 32 percent depend on company earnings
- 31 percent depend on credit cards
- 15 percent depend on large banks
- 14 percent depend on community banks
- 13 percent depend on loans from friends and family
When a small business cannot obtain the funding they need, they are faced with difficult decisions. Some of the ways business owners respond to a lack of funding include turning down sales, cutting employees and slowing their operations or growth. Since so many small businesses exist, this could spell trouble for the larger economy. In most cases, one of the primary reasons given for closing the doors on a small business include lack of financing.
Small Business Diversity Statistics
Small business across the country account for nearly 50 percent of all employees. There are a staggering eight million firms that are considered minority-owned. More than 250,000 businesses are considered small business exporters as well.
Challenges Funding Import/Export Transactions
Because of the number of small businesses involved in trade, it is easy to assume they face more than their fair share of challenges when it comes to obtaining funding. This is true at most stages of an export business because there are numerous components including logistics.
Fortunately, Capstone Corporate Funding can help these businesses by providing a broad range of services to help with export financing. We understand how to structure the right type of transaction to help with financing, provide logistical support when needed, and help you with other aspects of these transactions. We understand how important this is for your continued business growth and that is why we offer customized trade financing solutions designed to meet your needs.
Minority-Owned Business Solutions
Despite the number of minority-owned businesses across the United States, many of these businesses suffer financially because of a lack of resources. There are hundreds of studies showing a minority business owner can still face hurdles when seeking financing options. Like every business owner, a minority must have access to public and private funding sources to help them growth and allow their business time to thrive.
This is when you can count on Capstone Corporate Funding. We take pride in the fact we have worked with various minority-owned businesses to help them overcome their financing challenges. Thanks to the efforts of our diversity team, we can provide a range of financing solutions to help minority-owned businesses the opportunity to find a solution that best meets their needs.
Small business owners need not borrow money on their high-interest credit cards, reduce their employee count, or turn down potentially lucrative contracts. Instead, contact an experienced member of our team at (212) 755-3636 to speak with a representative today and let us help you get the funding you need.
