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Small businesses have significance both at micro and macro levels. At the micro level, they can provide independence to individuals and a livelihood that is not dependent on an employer. At the macro level, they generate the largest percentage of employment in the country and contribute in a major way to the country's national income.
Small businesses usually employ a small number of persons and have relatively low sales volumes. Typically, they are organized as sole proprietorships, partnerships and privately owned corporations. Legal definition of what is a small business varies from country to country.
These businesses do not typically dominate their fields and are vulnerable to the policies and practices of large businesses in the same industry.