MAIL BAG – WHEN IS A BUSINESS SMALL?
Alert reader G. Paltrow writes, “My small office in Waco, TX only has 15 people in it doing $2 million a year in sales. I think we’re a small business, even though our parent company, located all the way in New York City, has 2,000 people and $50 million in sales. They’re not really part of our operation, aren’t we small?” Sorry, G., the most likely answer is “no”, your business is not small. Even though your location is small, you’re part of a much larger firm that likely does not meet small business size standards. While I’d have to know more about your business to see what NAIC’s code you fall under, typically larger firms with significant sales don’t qualify as small businesses. Your reasoning, however, is not new. Many companies incorrectly believe that they can call themselves small businesses if they’re a small subsidiary of a larger company. The SBA, however, doesn’t see it that way and your entire company can get in trouble for certifying as a small business when you are not. While small business status can be an important factor for developing or growing your federal business, it’s even more important to deliver quality solutions at competitive prices. The quality of your company will drive business, no matter what size it turns out to be.