Like many others in our industry, I am guilty of ignoring mid-size or medium-sized businesses. Seldom does anyone specifically write about the “M" in “SMB." Depending upon how the group is segmented, it represents the widest range of companies with the greatest diversity of needs.
Using parameters from Gartner and other major analysts, medium-sized businesses range in employee count from 100 to 999. Using this range and data from the U.S. Small Business Administration, Office of Advocacy, U.S. Census Bureau, and Statistics of U.S. Businesses here are some important facts:
- There are approximately 93,000 medium-sized businesses with 480,000 locations in the U.S, compared to 5.6 million small businesses with 5.8 million locations. Medium-sized businesses have an average of 5.3 locations while — understandably — small businesses an average of one.
- Medium-sized businesses represent 1.6 percent of all businesses, compared to small business representing 98 percent.
- Medium-sized businesses have a total of 22 million employees, or an average of 236 per business.
- Payroll for medium-sized businesses is $1 billion, versus $1.4 billion for small businesses. Average annual pay per employee is $45,500 versus $35,000 for small businesses, a difference of 30 percent. This compares quite favorably with enterprises whose average of $50,000 is just 9 percent higher.
- Medium-sized businesses added more than 2 million jobs between 2007 and 2010, while employment at enterprises dropped by 4 million. Moreover, medium-sized firms have added another 2 million since the end of the recession while employment ay enterprises and small businesses has dropped.
The metrics for a medium-sized business infer a greater diversity and increase in knowledge workers, IT sophistication, networking infrastructure, capital expenditure, operational expenditure and, ultimately, more complex business environment than that of a small business. Therefore, it begs the question of why we continually lump small businesses and medium sized businesses together when discussing target markets. Consequently, I have added a third column to my slide on honing marketing and sales messaging to be presented during Cloud Partners to include medium-sized businesses.
If you are in Chicago this week for Cloud Partners, stop by on Thursday at 2:00 to learn the Five Essentials of Selling Hosted Unified Communications presented by ANPI. We look forward to seeing you there.
David Byrd is chief marketing officer and executive vice president of channel sales for ANPI ZONE . He previously spent five years as vice president of marketing and sales for Broadvox and before that was vice president of channels and alliances for Eftia and Telcordia.