|What Is an SME Business?|
Small and medium-sized businesses in favor of small and medium-sized enterprises, or SMEs. Although the company is widely recognized as a category, there is no single definition of what constitutes an SME. The criteria vary depending on the location of the company, the industry in which it operates and the purpose of classification.
Criteria and Thresholds
Different definitions of what constitutes an SME based on quantifiable and comparable, for example, number of employees, the level of sales revenue criteria for a certain period, turnover or assets. Thresholds is then installed on each criterion based on the economic structure and industrial heritage. Branches may affect the threshold, as in the US and Canada models. Other methods of categorizing ignorance of the industry, such as the definition of small and medium-sized enterprises, issued by the European Commission.
Myanmar SMEs play an important social and economic role. Promoting innovation and entrepreneurship and use a significant part of the workforce. SMEs account for 98 percent of businesses in Canada and the use of 48 percent of the workforce. In the European Union, 99 percent of enterprises are defined as small and medium enterprises- SMEs, providing 90 million jobs. Because of its economic significance, SMEs can gain access to system support and financial assistance for large organizations.
In the United States, the Small Business Administration issued standards that determine the size of a small business by establishing the maximum number of employees or annual revenue. In addition, the organization must be independently owned and operated and is not dominant in its field nationwide. The SBA size standards vary depending on the industry in which the company operates meets North America Industry Classification System. At the SBA website includes a table that provides a full breakdown of industry standards.
Industry Canada defines SMEs as companies with less than 500 employees. In order to be classified as "small" companies producing goods must be less than 100 employees, and service-based business must have at least 50 people.
From 1 January 2005, the European Commission adopted the definition of SMEs, to consistently apply to all Member States, the European Investment Bank and the European Investment Fund. The European Commission classifies the company as an SME, if an organization is not an independent subsidiary, which employs less than 250 employees with less than 50 million euros or balance sheet not exceeding 43 million euro turnover.
You might also like-