Posted BY: Larry Alton
Most of us have an innate fondness for small businesses for one reason or another. Maybe you like the idea of meeting and chatting with the business owner of a small establishment more than the idea of interacting with automatons in a large, bureaucratic organization. Maybe you like the meritocratic elements of entrepreneurship as a reward system for the industrious. Or maybe you just like seeing lots of unique little shops in your hometown.
But aside from our subjective preferences, it’s objectively true that small businesses function as the heart of our economy, on both a micro and macro scale. Why are small businesses so important? And how can you start one of your own?
Why Small Businesses Are So Important for the Economy
These are just some of the reasons why small businesses are so important for our economy:
Innovation and growth. When businesses get large, bureaucratic, and complexly organized, they tend to slow down in terms of innovation and growth. Established companies would rather adhere to the formula they used to become so massive than experiment with something new, while new and small businesses are forced to innovate if they want a chance to compete. Because of this, a disproportionate number of new inventions and industry disruptions come from small businesses and startups. Large corporations also realize this; it’s why established businesses like Google often secure their innovative capacity by buying up new small businesses, rather than innovating from within.