The Future of Small Businesses

Are we seeing the end of small businesses?  As we plod through the Great Recession and the biggest companies have been given billion of dollars while the small businesses are given additional regulation, small businesses are threatened.   It is almost as if the market, or government does not want the small business to survive.  It certainly appears that way in the beer industry.  I just finished watching a documentary called Beer Wars.  It was scary.

In the movie Anheuser Busch, Miller and Coors are portrayed and these mega-mega companies that squash competition and aggressively promote the status quo.  The big brewers are getting larger and larger by acquiring the smaller brewers.  As soon as a niche seems to be created through the hard work, vision and insight of an entrepreneur, one of the big guys comes in and steamrolls them.   I found eerie parallels with other industries like:  software (think Microsoft & Oracle), retailing (think Costco and Wal-Mart), home improvement (think Home Depot and Lowes) broadcasting (think Comcast and Turner) and personal computers (think Dell and HP).  I could go on but I think you get the message.

Why do some industries become concentrated among two or three big players?   What about the anti-monopoly laws?  Isn’t the government supposed to break-up monopolies to foster greater competition and aid the consumer?  Isn’t that what the break-up of AT&T was all about back in the 1980’s?

So why do industries that are started by small businesses ultimately become dominated by big players?  It’s as if there is an invisible gravity within capitalism that causes industries to collapse inward on them like a black hole.  In the end nothing exists but the economic darkness of a few monopolistic players.  Are we starting to see the same effect in banking, or are the regulators seeing the damage that banking concentration caused?

Will the new healthcare law cause a consolidation in health care providers and insurance companies?  I don’t know, it’s still hard to tell for me, but I would appreciate your feedback.   Let me know your thoughts.

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avatar Posted by on Apr 6 2010 Filed under General Interest. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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