Released April 21, 2008
STILLWATER, Okla. -- The next time you are with a group a people, look around. Probably three of every four persons want to own their own business. Across the country, some 18 million of these people each year take action toward the American dream, owning their own business. These entrepreneurs, innovators and small businesses are key players in the country’s economy. And Oklahoma is no different.
Glenn Muske, Oklahoma State University Cooperative Extension Service home-based and micro business specialist, and interim assistant director, said that the micro businesses, those employing less than 10 employees, and home-based business owners make up more than 95 percent of all Oklahoma businesses.
“Only about 1 percent of businesses in this state employ 20 or more people. With that number in mind it’s not surprising the role that the smallest of the small businesses play in Oklahoma’s economy,” Muske said. “Communities that are interested in diversifying the economy need to teach entrepreneurship and encourage the development of this basic sector. The potential entrepreneur needs help with understanding what’s involved in starting a business, identifying the opportunities that are available and teaching the process of going from a business idea to opening the business. All of these steps are vital in developing and implementing a business plan.”
Building a good business is a priority for everyone involved. Fast growing businesses, in terms of sales and employees, are often referred to as the “gazelles.” These are the businesses that appear to take off overnight. Some well-known gazelles include Google, EBay or Microsoft. Yet for every gazelle, there are hundreds of businesses that for a variety of reasons grow more slowly. These businesses are called mice. Although not as attention-grabbing as the others or employing the hundreds of people they do, it is this micro world that forms the base of our economy and has a substantial positive impact on the local economy.
What communities must keep in mind, Muske said, is that the “gazelle” businesses are not identified as gazelles until they have become successful.
“It’s very difficult to determine in the early stages of a business which ones are gazelles and which ones are mice,” he said. “Obviously we want all businesses to be gazelles, but looking at the statistics, only a small percentage of businesses reach that point. Keep in mind that more than 95 percent of today’s businesses have less than 20 employees. There is a large market in the ‘small business’ arena that must be filled.”
The small business arena can definitely be a risky venture. As noted, 18 million people take steps toward entrepreneurship every year. It is not unlikely that more than 60 of those businesses will still be around five years later. After helping a business get going, an entrepreneurial community then continues to provide support and networking to increase the business’s chance of staying around.
“New employer businesses in Oklahoma were estimated at 8,609 in 2005. This is 7.1 percent fewer than the previous year,” Muske said. “Business bankruptcies increased by more than 43 percent that same year. These statistics make it clear why communities must embrace the small business market and educate those future entrepreneurs on what it takes to successfully run a business.”
According to the most recent data, Oklahoma has approximately 324,000 small businesses. Women own about 75,000 businesses and generated $929 million in 2002. In addition, more than 4,500 businesses are Asian owned and generated $458 million in receipts. Businesses owned by Hispanics totaled 5,442 and contributed more than $1 billion to Oklahoma’s economy.
“These figures are very impressive and it’s important to continue the trend of developing successful small businesses,” he said. “The economy of our state depends on it.”
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Contact: Trisha Gedon, (405) 744-3625, trisha.gedon@okstate.edu
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