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Monday, May 19, 2014

SBA may call business with 1,500 employees small.

This is crazy. I just received this media release from the Small Business Administration. New director's first major effort is to make larger businesses eligible for SBA assistance by changing the definition..

The definition of "small business" that the SBA has used for years of 300 employees does need to be changed, but they are going in the wrong direction.

Here's my idea: let's cut from 500 employees to 300. EF Schumacher (author of Small is Beautiful)  makes a good case for 300 being the right number, beyond that it's hard for the owner/manager to know all the employees personally.

Below is contact information. If you think cutting to 300 is a good idea, I hope you'll take a couple of minutes and send in an email. Thanks!

John S. Wren, MBA+++
Founder & CEO until fired, Small Business Chamber of Commerce, Inc.

SBA Proposes Revisions to Size Standards for Wholesale Trade and Retail Trade Industries

WASHINGTON – The U.S. Small Business Administration has proposed increasing small business size standards affecting businesses in 46 industries in North American Industry Classification System (NAICS) Sector 42, Wholesale Trade, and in one industry in Sector 44-45, Retail Trade.  If they are adopted, nearly 4,000 more firms will become eligible for SBA’s loan programs.  The proposed rule was published in the Federal Register today.  
The proposed size standards would define the maximum number of employees a firm in these industries could have and still be a small business.  The proposed revisions reflect changes in marketplace conditions.
SBA proposed to retain the current size standards for the remaining industries in those sectors.  SBA reviewed all of the employee-based size standards for both sectors to determine whether the size standards should be revised or retained. 
The SBA has also proposed to retain the current 500-employee size standard for federal procurement of supplies under its non-manufacturer rule because Wholesale Trade and Retail Trade NAICS codes and their small business size standards cannot be used for procurement of supplies.  These proposed revisions primarily affect eligibility for SBA’s financial assistance programs. 
Comments can be submitted on this proposed rule on or before July 18, 2014, at, identified by the following RIN number: (RIN 3245-AG49).  You may also mail comments to Khem R. Sharma, Chief, Office of Size Standards, 409 3rd St., SW, Mail Code 6530, Washington, DC  20416.
As part of an ongoing review of all size standards, SBA takes into account the structural characteristics of individual industries, including average firm size, startup cost and entry barriers, the degree of competition, and small business share of federal government contracting dollars.  This ensures that small business size definitions reflect current economic conditions and federal marketplace in those industries.  Under the Small Business Jobs Act of 2010, SBA plans to continue its comprehensive review of all size standards for the next several years. 
An SBA-issued White Paper entitled, “Size Standards Methodology,” which explains how SBA establishes, reviews and modifies its receipts-based and employee-based small business size standards, can be viewed at
For more information about SBA’s revisions to its small business size standards for various industry sectors, click on “What’s New with Size Standards” on SBA’s Web site at   

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