Small And Medium Enterprises Essay

Businesses and industries that are not owned or controlled by the Government. Private Sector organisations operate privately to make a profit with income generated from the sale of their products or services. Although many private sector firms are owned and controlled by individuals, many are owned by groups of people; for example, companies may be owned by shareholders, who have invested in that company.

Countries have different endowments. Differing climates give advantages to the production of different crops. Differing histories and inclinations result in different advantages in finance, skills and manufacturing.

* Small Businesses are companies that have between 1 and 99 employees under its organization.

Small businesses are the backbone of national economy and play a leading role in innovations as well as in creating jobs. Small business has the intrinsic needs to growth. Obvious contributions of the growth of small businesses include the increased return on investment and job creation. The interesting and valuable question is how small business grows and are all small businesses growing? It is no surprise that the growth of business is a core topic both in organization theory and entrepreneurship, both are interested in the process and causes of business growth. Stages of growth models, which assume that business go through some distinct stages from birth to maturity, have been the most popular theoretical approach in academic to understand small business growth. Although the stages model of growth has been criticized for being too sequential and linear which is unrealistic and inconsistent with empirical evidence (e.g. Phelps et al., 2007; Levie and Lichtenstein 2010), various new stages models of business growth have been developed since the 1960s.

b. The biggest socioeconomic programs contain those which have been set up for small-scale companies. Probably the most significant of small-scale company groups designated for preferences are small-scale company issues and small-scale company issues owned and operated by socially and also economically deprived people. Both kinds of companies happen to be given unique position in U.S. Government contracting with the Small Company Act (15 U.S.C. 631 et seq.) (A/OPE, 2011).

Age.It has been pointed out by Shumway (2001), that organization age could actually help firms to be more efficient,and age can be measured by the number of years since listing. As the organization aged, it helps them to build a name over the years. Moreover, the old age of the organization is a sign of knowing the appraisal value of the particular business due to obsolete and induces organizational decay (Agarwal, Rajshree&Gort, 2002). On the other hand, the success or downfall of a company depends solely on the management of the organization or entity’s.

The main body of the economic operation is for a large number of small private enterprises. Production and management

o Industry performance is influenced by population growth and the age distribution of the population

1. What factors contribute to the rapid pace of change in business? Is the pace likely to accelerate or decrease over the next decade? Why?

The small business marketplace is extremely dynamic and the changes are fast. Here are some encouraging facts from the US Small Business Administration on small businesses. There are about 30 million small businesses in the United States and employ just over half of the country’s private workforce. They employ a staggering 40% of high tech workers such as computer professionals, scientists and engineers. More than half of the small businesses are home-based businesses and two percent of them are franchises. One of the most important aspects is the fact that a majority of innovations in the United States come from small businesses.

Small businesses are becoming a trend in the work environment today. The analogy of small businesses to large business brings about the question, “Can they eventually equal up in the world

Small medium sized enterprises and small and medium sized businesses are often referred to as SMEs. These are companies whose number of employees or turnover falls underneath certain limits. The EU defines companies with fewer than 50 employees as small, and those

There is no single definition for small business an earlier attempt was given by Bolton Report (1971). Which suggests two definitions of small business. Firstly, he says a business is small if it meets three criteria’s:

For this research work a small firm is assumed to be a firm with less than 10 employees and a mid-size firm is assumed to be a firm with less than 100 employees.

The importance of small and Micro Enterprises (SMEs) in the economy of any country cannot be overlooked. In fact for nearly 15 years, most researchers dealing with economic planning have highlighted the significance of these enterprises stating that they are a key player in realizing any country’s economic goals. As such, governments as well as other organizations with interest in development are laying plans and strategies to promote the establishment of Small and Micro Enterprises. This is seen as a move to ensure that there is full participation of SMEs in the country’s economy. The Small and Micro Enterprises have been known to contribute to a large extend as a source of innovation, entrepreneurial skills as well as source of employment. For example, statistics in 25countries of the European Union show that 99% of the jobs provided to its citizens come from the micro, small and medium-sized enterprises. Rowe (2008) points out that the British economy relies heavily on the participation of SMEs. On the other hand, 99% of the UK’s economy is composed of small and micro enterprises.