How much is a billion? By Harvey McKay

Stories about billion-dollar corporate deals are in the headlines daily. Carl Sagan used to regale us with the mysteries of the “billions and billions” of stars in the universe. The population of China is more than 1,320,000,000, or approximately one-fifth of the world’s population.

A billion is a big number, no matter what you’re talking about. Most of us can’t begin to comprehend just how much a billion is, but a friend sent me some statistics to put it into perspective. (Alexander B. Trowbridge, Jr., former U.S. Secretary of Commerce, presented similar statistics a number of years ago; these have been updated.)– A billion seconds ago it was 1975. (1,000,000,000 seconds = about 31.7 years)

– A billion minutes ago it was 100 A.D. (1,000,000,000 minutes = 1902.5 years)

– A billion hours ago our ancestors were living in the Stone Age. (1,000,000,000 hours = about 114,155 years)

– A billion days ago nobody walked on this earth on two feet. (1,000,000,000 days = 2,739,726 years)

– A billion dollars ago was just about eight hours at the rate our government is spending money. (You do the math. I’ll just keep paying the taxes.)

Why is it important to think in terms of billions and trillions, when most of us would be happy to see a million dollars? It’s the world we live in, and in all likelihood, those colossal numbers will only get bigger. Not only do large companies employ huge numbers of workers, they determine how we live, and in many cases, tell us what we need. But they still have to respond to customers’ demands in order to stay profitable.

Telecommunications companies, computer giants, airlines, big box stores, automakers, insurance companies and even Tiger Woods and Martha Stewart are billion dollar industries. How much is $1 billion worth of cheesecake? Ask The Cheesecake Factory, which topped a billion in sales a year or so ago. No, there are not a billion Starbucks locations, but they make money like there are. And three different dollar store chains are in the top 100 retailers, all with sales in the billion-dollar range. That’s a lot of $1 items.

But my personal favorite of the mega-success stories has to be YouTube, founded in February 2005 as a medium to allow people to upload and share video clips (some serious, some downright outrageous). In October 2006, Google acquired YouTube for a whopping $1.65 billion in stock. Just for the record, YouTube delivers 100 million video views every day (that’s 1 billion every 10 days) with 65,000 new videos uploaded daily.

In fact, about 5 percent of U.S. companies, about 450, which went public since 1980 have reached $1 billion in sales. How did these companies do it? According to Fortune Small Business, they followed one of three paths:
1. Created an entirely new market for their products and services (like Microsoft).
2. Redefined an existing market (Starbucks).
3. Underpriced the competition (Staples and Home Depot).
So what about the 95 percent of businesses that don’t hit the big time? Are they less successful?
Don’t automatically assume bigger is better. If small business is the backbone of America, big business is the muscle. We need both. Not every business is cut out for enormous growth, and not every manager or employee thrives in the World of a Lot of Zeroes.
What is most important in my view is that every business, regardless of size, treats each customer as though they are one in a billion. Treats them like their only customer … and their most important customer. Addresses their needs and listens to their concerns. Maintains high standards of quality and service. Looks at the customer as a single person and not just another demographic.

Then, and only then, will success follow.

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