Corporation vs. Small Business: 4 Key Differences

Much like choosing a college or city, choosing whether to work for a large or small company can impact the quality of your life. Choose a large company, and you may have endless opportunities for advancement. But, you may have to try hard to be noticed. Work for a small company, and there may be a greater sense of community and “family,” but you may stay “stuck” in the same position year after year.

There’s no one right answer for which is better. However, there are pros and cons to working for large and small companies to consider. Knowing these pros and cons can help you better target your job search and help make sure you don’t end up at a company where you don’t thrive.

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What is a small business?

A small business is an organization privately owned by one or more individuals. Most small businesses can vary anywhere from one to 150 employees, depending on its industry or location. These businesses often earn lower profits and produce fewer products than corporations, allowing them to apply for more government support services. A majority of organizations typically start as small businesses and have the potential to develop into larger corporations, depending on the business owners goals.

What is a corporation?

A corporation is a type of legal business entity that shareholders typically own. They may then hire a board of directors, which is a team of individuals who oversee the financial and structural changes that the business undergoes to ensure it remains in strong financial and organizational standing. The goal of many corporations is to successfully sell large amounts of products or services to customers that result in significant profit increases. This can cause the company to continue expanding as the board invests in partnerships, grows the companys clientele and adds on to its product line.

Corporation vs. small business

Understanding how both these types of organizations function can help you better determine which workplace could more effectively cater to your career needs and goals. Here are the key differences between a corporation and a small business:


Most corporations are more established and have used the past few years to grow and improve the company. This can often mean the company has a larger team for you to collaborate with, which can allow for job openings and available roles for promotions. Working at corporations with several different employees and companies can give you to opportunity to learn about other areas of the industry. If youre starting out in your career, a large corporation can often allow you to try different roles to learn which is right for you.

Smaller businesses often have fewer employees and roles. If youre interested in collaborating with smaller teams, you may excel in a small business as you grow stronger connections and relationships with teams. Having fewer employees can make the environment seem more personable, which can increase your comfort levels. Feeling closer to coworkers and managers can make you feel more confident sharing ideas or asking questions when needed.


Many employees working in a corporate environment often follow a strict structure as their managers typically define their roles and responsibilities clearly. When you start in a corporation, you may likely have a clear idea of your supervisor and tasks. This can make you feel more in control of your workday and ready for upcoming events as you follow a set routine regularly. A more structured schedule can help you feel more stable and confident in your role.

Since small businesses are often growing and have fewer employees, you may follow a more flexible and changing schedule each day. You may have a larger variety of responsibilities to complete since there arent as many employees available to cover them. This can be an effective environment to work in if youd like to complete different tasks every day and develop several different skills. Improving these strengths and abilities can boost your creativity as you come up with innovative solutions and ideas to pitch to your supervisor and team.

Learning and growth opportunities

Working at a larger corporation often gives you more access to a wider network of professionals. This can allow you to find mentors and other employees working above you to learn and seek advice from. Many corporations have an easier time securing the funds to host or attend industry events to help you expand your knowledge and skill set. Since larger corporations have more positions available, they might have Professional Development programs in place to help you grow in your field and obtain higher positions available within the company.

Many small businesses give you opportunities to establish connections and support from managers through one-on-ones and other meetings. Though they may have fewer resources and access to the same training programs as corporations, employees can attend high-level meetings and help solve more complex problems that senior-level employees would normally solve at corporations. This allows you to develop skills through hands-on tasks, while also receiving valuable feedback from managers who you might work more closely with each day.

Salary and benefits

Corporations typically receive significant funding and financial support from stakeholders and investors, which allows them to offer higher salaries to their employees than most small businesses. Along with higher salaries, some corporations can grant team members with greater access to impressive insurance plans. Larger budgets also give employees access to more expensive, high-quality equipment, which can help improve productivity and efficiency levels.

Employees who work at small businesses can still have access to impressive perks. Since there are fewer staff members, managers and human resource employees might take time to understand the individual needs and preferences of all employees to develop personalized plans and benefits catered toward their employees. If you work on a smaller team, you may also have a closer and more trusting relationship with your manager or human resources team. This might cause them to offer perks like remote working or unlimited vacation time if you follow the necessary policies and submit assignments by designated deadlines.


How does small business differ from corporations?

As the name suggests, small businesses are small. This means they usually have a smaller payroll and earn less annual revenue than bigger corporations. Since small business owners employ fewer employees, they often look for staff to take on multiple roles within the company.

Why small businesses are better than corporations?

Small businesses are more nimble than larger businesses, and are better able to adapt as market conditions change. Because a small business is closer to its customers, it is in a better position to hear feedback and observe changing preferences.

Is it better to work for a small business or a corporation?

Corporations typically receive significant funding and financial support from stakeholders and investors, which allows them to offer higher salaries to their employees than most small businesses. Along with higher salaries, some corporations can grant team members with greater access to impressive insurance plans.

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