2024 Small Business Revenue Statistics
Last Updated January 9, 2024
Small businesses play a critical role in our local and global economies, but it can be difficult to make informed business decisions without having benchmarks or statistics to base your decisions on. We have put together some key small business revenue statistics to give small business owners an idea of how their companies stack up against national averages and trends.
Small Businesses Make Up 99.9% of All US Businesses
With 33.2 million small businesses in the United States, SMBs are the backbone of the our economy, making up 99.9% of all US businesses. Additionally, the number of small businesses (both employer and nonemployer firms) has increased over the last few years, and small businesses have even been responsible for 62.7% of net new job creation since 1995 (advocacy.sba.gov). Amongst these small businesses, 80% of them are nonemployer firms, meaning they do not have any paid employees (fedsmallbusiness.org).
The Average Small Business Owner Salary Is $69,301
According to PayScale, the average small business owner takes home a salary of $69,301 per year. The highest pay recorded for small business owners is $135,000, and the lowest pay is $30,000.
However, there is quite a bit of variance from source to source regarding small business owner salary statistics. For example, Zippia reports that the average business owner salary is $50,934 per year, while Comparably reports the average small business owner makes $97,761 per year. Even still, Fundera found that 30% of small business owners don’t take a salary at all, and 86% take a salary of less than $100,000.
The Average Annual Revenue for US Nonemployer Establishments Is $49,489
A nonemployer establishment is a business that has no paid employees and makes more than $1,000 per year in revenue. Based on data from census.gov, the average revenue for a US nonemployer establishment was just under $50,000 in 2019, up 1.38% from 2018.
Additionally, there is quite a bit of variation in the average revenue of establishments by industry. For example, businesses in the real estate, rental, and leasing industry bring in 106% more revenue, on average, compared to the cross-overall nonemployer average. Other higher earning industries include wholesale trade (+97%) and finance/insurance (+71%).
There are more industries that earn below the overall average than those that earn above it. The lowest earning industries include educational services (-70%), administrative, support, waste management, and remediation services (-51%), and arts, entertainment, and recreation (-44%).
| Industry | Average Revenue | Compared to the Overall Nonemployer Average |
|---|---|---|
| Real estate, rental, and leasing | $102,040 | +106.2% |
| Wholesale trade | $97,685 | +97.4% |
| Finance and insurance | $84,664 | +71.1% |
| Mining, quarrying, and oil and gas extraction | $68,949 | +39.3% |
| Utilities | $68,796 | +39.0% |
| Construction | $65,051 | +31.4% |
| Manufacturing | $54,083 | +9.3% |
| Professional, scientific, and technical | $49,077 | -0.8% |
| Agriculture, forestry, fishing, and hunting | $47,742 | -3.5% |
| Retail trade | $44,826 | -9.4% |
| Transportation and warehousing | $43,671 | -11.8% |
| Information | $40,170 | -18.8% |
| Accommodation and food services | $39,171 | -20.9% |
| Health care and social assistance | $35,786 | -27.7% |
| Other services (except public administration) | $31,886 | -35.6% |
| Arts, entertainment, and recreation | $27,506 | -44.4% |
| Administrative, support, waste management, and remediation services | $24,132 | -51.2% |
| Educational services | $15,110 | -69.5% |
78% of US Nonemployer Establishments Make Less than $50,000 In Annual Revenue
Even though the average nonemployer revenue is $49,489, more than three fourths of nonemployer establishments make less than $50,000 per year (census.gov).
However, there is still an opportunity to bring in quite a bit of revenue as a nonemployer business; 1.3% of nonemployers bring in more than $500,000, and 0.2% bring in more than $1 million per year.
| Annual Revenue | Number of Establishments | Percent of Establishments |
|---|---|---|
| > $1,000,000 | 45,953 | 0.2% |
| > $500,000 | 358,375 | 1.3% |
| > $250,000 | 1,052,664 | 3.9% |
| > $100,000 | 3,201,418 | 11.8% |
| > $50,000 | 6,064,822 | 22.4% |
| < $50,000 | 21,039,184 | 77.7% |
| TOTAL ESTABLISHMENTS | 27,104,006 | 100.0% |
When breaking down the nonemployer average revenue by entity type, we found that sole proprietorships make $35,897, on average, which is 28% less than the overall nonemployer average. On the flipside, S-corporations, partnerships, C-corporations, and other corporate legal forms of organization each make more than $100,000 in revenue, on average, per year.
Women-Owned Businesses Make 44% Less Revenue Than Male-Owned Businesses
Small and medium-sized businesses owned by women earned, on average, 30% less revenue in 2021 compared to men-owned businesses ($263,091 vs. $469,372). According to Biz2Credit, despite there being a significant lack of parity in key financial metrics between women and men-owned businesses, women-owned businesses saw stronger year-over-year growth in average earnings (annual revenue – operating expenses) with a 27% YoY growth compared to 22% growth. Despite this growth, average earnings for women-owned businesses was still 47% less than for men-owned businesses.
According to CNBC, “The male advantage can be attributed to the fact that they have been in business longer, and these entrepreneurs have had time to develop strong networks in industries like IT, construction and logistics.” While men-owned businesses continue to outpace women-owned business performance, economists believe that parity could be just a few years off.
On Average, Small Businesses Are Paid 1 – 2 Weeks After the Invoice Due Date
Late invoice payments can be detrimental to small businesses, and according to Chaser, small businesses are paid more often than not after the invoice due date. Solo business owners are most likely to get paid prior to the invoice due date, while companies between 2 and 50 people are least likely to get paid on time amongst small businesses.
So how do these late invoice payments impact revenue? According to QuickBooks, businesses under 500 people were owed, on average, $304,066 in late payments. Not only that but late invoice payments resulted in 89% of small and medium-sized businesses to say that they prevented business growth.
Cash Flow Is the Number One Reason Why Small Businesses Fail
Small business survival rates are always a point of interest when starting a new business. According to the Small Business Administration’s Office of Advocacy, 68% of small businesses survive their first two years, and nearly half survive for at least five years. However, survival rates drop off pretty drastically once businesses reach the decade mark with only 34% surviving at least 10 years and 26% surviving at least 15 years.
The primary reason new businesses fail? 82% of startups cite cash flow problems as the reason for closing (Visual Capitalist). While this can sound intimidating, there are plenty of ways to combat cash flow issues, including:
- Collecting invoice payments as quickly as possible and paying vendors as slowly as possible
- Doing credit checks on your customers to ensure they are creditworthy and increase the likelihood of on-time payments
- Increase working capital through an alternative financing method, such as invoice factoring or invoice financing
- Lease equipment instead of purchasing it outright
- Offer early payment discounts
For more ways to improve cash flow, check out our article.
What Do These Small Business Revenue Statistics Mean for You?
These small business revenue statistics may make starting a company sound daunting, but they are important to review to help you make solid business and financial planning decisions. Starting a business is hard work and modest earnings may deter you, but becoming an entrepreneur can be an incredibly rewarding experience. Now that you are equipped with industry benchmarks and nationwide trends, you are better prepared to enter the entrepreneurial market.
Below are some resources that can help you get started with your small business:
- Ways to Fund a Business Without a Loan
- Cash Flow Risk Management and How to Reduce It
- Cash Flow Management for Small Businesses
- How to Do a Budget Analysis for Your Business
Angela is the Director of Online Marketing at altLINE where she manages content production, marketing and sales operations, and digital PR. Angela joined altLINE in 2022 after several years of working in digital marketing across various industries including financial services and B2B. Angela loves creating content that helps readers better understand their financing options and helps them make informed decisions about factoring. Her work has been featured in publications like Search Engine Journal and Moz.
