SBA Proposes to Increase Small Business Size Standards
Posted on Mon, Nov 28, 2011 @ 03:15 PM
The Small Business Administration SBA has issued a proposal to increase small business size standards for several industries under the North American Industry Classification System. The industries affected include the truck renting and leasing industry. The proposal would change some of the ways small businesses are classified.
Currently, the size standard is $25.5 million in annual gross revenue; the SBA is looking to increase this to $35.5 million. It has been about 30 years since the standards have been changed so re-evaluation is needed. It is also needed to fulfill the Small Business Jobs Act of 2010, which calls for this review of 20 industries and one sub-industry.
The SBA's 5 Industry Factors:
- Average firm size.
- Startup costs and entry barriers.
- Industry competition.
- Distribution of firms by size.
- Impact on Federal contracting and SBA loan programs.
In addition to these factors, members of the SBA will use three others to determine whether or not to change the size standards:
- Current economic conditions.
- Administration's policies.
- Input from industry groups and Federal agencies.
They will also look at data from the 2007 economic census to decide on the proposal. The census contains information about the number of firms, establishments, and employees. It also has annual payroll, and annual receipts of an industry. If the proposal goes through it will affect firms in the truck, utility trailer, and RV rental and leasing industries.
The complete proposal can be found here.