Researchers disagree over what percentage of new jobs is created by small business. Research indicates that the age of company more than its size determines the number of jobs it creates. That is, virtually all of the new jobs in recent year have come from new companies, which include not only small companies but also new branches of huge, multinational organizations. However, small companies still are though to create a large percentage of new jobs in the United States. According to the Small business Administration the nation’s 23 million small businesses created two million jobs between October 2000 and March of 2004. Jobs created be small businesses give the United states an economic vitality no other country can claim. However as we discussed earlier other countries are finding new ways to encourage entrepreneurial economic activity.
According to Cognetics Inc., a research firm run by David Birch that traces the employment and sales records of some 9 million companies new and smaller firms have been responsible for 55 per cent of the innovations in 362 different industries and 95 per cent of all radical innovations. In addition fast growing businesses, which Birch calls gazelles, produce twice as many product innovations per employee as do larger firms. Among the notable products for which small businesses can be credited is WD – 40 the jet engine and the shopping cart. Virtually every new business represents an innovation of some sort whether a new product or service how the product is delivered or how it is made. In addition many of toady’s new products from giant corporations are originated by small companies. Consider the popular Crest Spin Brush from Procter & Gamble.
The product was originally created by a tiny start up. P&G bought the companies and brought in the entrepreneurial leaders to head up the new division. Entrepreneurial Innovation often spurs larger companies to try new things. P&G is paying close attention to another small start up that could threaten the giant corporation’s sales of Dawn dishwashing liquid.
Two twenty something entrepreneurs are cleaning up with their new approach to cleaning products. During the dot-com boom of the 1990s, Eric Ryan and Adam Lowry wanted to start a business. but instead of going on the Internet they went to the grocery store scanning the shelves for a product in need of a makeover and they found it in the cleaning products aisle.
Ryan and Lowry began mixing up cleaning solutions in their kitchen to develop a line of nontoxic cleaning products. What differs from other naturally derived cleaners are the cool packaging affordable prices and fresh scents like Lavender, mandarin and cucumber. Method has brought cutting edge style to a mass market product. Consider the shot selling dish soap, which comes in bright colors like lime green or mandarin orange inside a sleek stylish bottle that’s so appealing you’d never want to hide it under tie sink. It’s designed to sit upside down in the sink, allowing for a time savings squirt from the bottom. A unique valve design keeps the liquid from oozing out until you squeeze it. The bottles began flying off the shelves almost as soon as they were stocked. Method realized that the designer dish soap was doing something almost unheard of in the cleaning products business: inspiring impulse buys.
Method now with 18 employers in San Francisco has expanded to numerous other cleaning products and is selling in stores like target, Albertson’s safe way and other national chains . The entrepreneurs worry that big companies will launch copy cat versions, and P&G admits that it is keeping an eye on the start ups. However, method has built a legal following of customers who appreciate the fresh approach to age old products.
Method is an excellent example of how entrepreneurs and small companies bring fresh ideas to stale industries. Small business innovation keeps US companies competitive which is especially important in toady’s global market place
Source: New Era Management