Principles of Business
Phase 2 DB
Instructor: Shelley Bartow
Mary Thompson
November 28, 2012

A small business consists of less than 500 employees, low volume of sales, and privately owned. It also is defined by its function in the economy. A small business can be classified by its assets and profits. Some examples of a small business are a convenience store, hair dresser, restaurant, or bakery. You must be willing to work hard and have a plan.
Some people are motivated by the flexibility of owning their own business and the ability to make it succeed and your own boss. You also must have a team that is willing to work together for the common cause. Your team should have the capability of contributing knowledge on their level of knowledge to achieve your goal. The next characteristic is low volume of sale. Sale volume is the quantity of an item sold in a given period example: six months or a year. The demand for a product influences the sale volume of a profit. Good pricing of a product helps make the sales of profits and volume rise. The company must find the right price that makes the product sell and allowing the company to profit. There are many advantages of being a small business because they don’t have to report financial reports to any time to the public. The next characteristic is privately owned which is sole proprietorship. There are other names for private businesses unlimited company, limited company, and limited liability. There are two categories for a private company, privately held and publicly traded. Publicly traded put their shares on the stock market and anyone can purchase their stock and become partial owner. Private companies play a major importance in the world economy. Private companies do not have to worry about a hostile takeover and doesn’t need shareholders’ approval to take action on anything. How is small business contributing to today’s economy? Small businesses contribute more to the U.S. economy and society that can be calculated by their spending and profit. Small businesses are more original than corporations; quick to respond to consumer demands than the big companies; and creating opportunities for women and minorities. In a whole small businesses hire 50% of the private sector and responsible for all net jobs in the economy. They pay taxes, private employment to citizens, and earn the country foreign exchange. If I opened a business it would be a small convenience store. I would have candy, chips and all kind of stuff that