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- 2. Small and Medium Enterprise (SMEs) ‘A small and medium enterprise (SME) is defined as a company that has fixed assets not exceeding $5 million book value and/or has a maximum of 100 employees’
- 3. Small and medium enterprises or SMEs are companies whose headcount or turnover falls below certain limits Small enterprise generally refers to a business employing 50 persons or less It is an enterprise in which investments in plant and machinery is between 25 lakh to 5 crores These enterprise works and operates to earn a small amount of profit. Small and Medium Enterprise (SMEs)
- 4. In Asia, Small and Medium Enterprise (SMEs)
- 5. Small and Medium Enterprise (SMEs) SMALL BUSINESS SMALL and MEDIUM ENTERPRISE 1. Number of employees Less than 20 people Maximum of 250 people 2. Place of business Small shop/home Own building/premise 3. Financial resources -Own savings as capital -Loan from bank -Loans from relatives, friends, etc -Credit from suppliers of goods -Profit of business -Money contributed by shareholders -Profit of the business -Sales of assets -Sales of shares -Loan and grants (eg banks) 4. Profitability Just to survive in business and to make a reasonable living As a firm grows larger, it increases its turnover and adds to its profits 5. Market size Small Big
- 6. -The government has recognised the strategic role that small and medium enterprises (SME) play in the overall economic growth of the country -The Brunei government expects that the SMEs will continue to play a key role in the country's economic development in this new millennium -SMEs have also been identified as the major players in the industrial development in Brunei Darussalam and have the potential in contributing towards the diversification of the economy -The development of small and medium enterprises will be enhanced through provision of financial and infrastructure assistance, entrepreneurship training, industrial incentive, technology improvement and other services and facilities -Hence, the government has been encouraging economic diversification through business services, financial services, hospitality and tourism, transport/logistics, agro food and halal industries Small and Medium Enterprise (SMEs)
- 7. -In 2008, there were at least 9,150 registered SMEs, which counted as 98.37% of the total establishments -Most SMEs were in the wholesaling and trading businesses, followed by construction sector, mining, quarrying and manufacturing sector, community, social and personal sector, agricultural, forestry and fishing. -Brunei's SMEs also provides at least 70% of employment in the private sector. In the service and manufacturing sectors, the contribution of SMEs is estimated at 38 - 40% Small and Medium Enterprise (SMEs)
- 8. -In Brunei, 98% of registered companies are considered to be small and medium enterprise (SMEs) -These businesses have between 0-100 employees Distribution of SMEs in Brunei 2.23% 1.63% 43.8% 52.3% micro small medium large Small and Medium Enterprise (SMEs)
- 9. -As in other countries, SMEs in Brunei has a great contribution to the economy -In 1994, SMEs contributed around 66.2 % to the nation's GDP Small and Medium Enterprise (SMEs) Large Businesses SMEs 68% 32% SMEs Contribution to Brunei's Economy (GDP) 1994-1995
- 10. The importance of SMEs for economic development -For developing and transitional economies (particularly in Asia), SME has a function to become a key component of wider economic development and lessening of poverty - SME can also acts as a major and sustainable generator of employment and income -SME can also serve as a useful bridge between the informal economy of family enterprise and the formalized corporate sector -SME may also be a source of foreign exchange earnings Small and Medium Enterprise (SMEs)
- 11. Characteristics Of SME ⚫Owner is the manager & few employees ⚫Owned & operated independently ⚫Relatively small investment, production, sales, dealings etc. ⚫Inadequate efficiency of business operations - no relationship with other firms or parties for Investment Management, finance, tax, accounting
- 12. The importance of SMEs for economic development -SME helps promote competition and a culture of entrepreneurship, which are conducive for economic growth -SME are more willing to innovate than large enterprises and conglomerates, hence, more business opportunities are being exploited -Size of SME sector in an economy appear to be positively associated with Gross Domestic Product (GDP) per capita growth in many countries -SME creates job opportunities, which is a key dimension of the development process of a country Small and Medium Enterprise (SMEs)
- 13. TYPES OF SMALL BUSINESS Manufacturing Service Retailing Construction firm Wholesaling Small and Medium Enterprise (SMEs)
- 14. Manufacturing ‘A manufacturing business is one involved in using different raw materials to make a product/s needed by the society’ Examples: manufacturer of furniture, sweets, shampoo, fish ball etc Small and Medium Enterprise (SMEs)
- 15. Small and Medium Enterprise (SMEs)
- 16. Service Business ‘Those that provide services in one way or another’ Examples: Dress shop, barber shop, tutoring services, etc Small and Medium Enterprise (SMEs)
- 17. Small and Medium Enterprise (SMEs)
- 18. Wholesaling ‘Activities of those persons or establishments who buy in bulk and sell to retailers and other merchants, and or to individual, institutional and commercial users but do not sell to final customers’ Examples: Wholesaler of soft drinks, mineral water, cloth materials, etc Small and Medium Enterprise (SMEs)
- 19. Small and Medium Enterprise (SMEs)
- 20. Retailing ‘Covers all of the activities involved in the sale of goods and/or services to the final consumers’ Examples: Retail pharmacy, fast food chains, appliance shop, grocery store, etc Small and Medium Enterprise (SMEs)
- 21. Small and Medium Enterprise (SMEs)
- 22. Construction firms ‘Those engaged in the construction of buildings whether for private individuals or for government’ Many of them perform sub-contracting jobs for bigger contractors such as installing electrical appliances and sewerage Small and Medium Enterprise (SMEs)
- 23. Small and Medium Enterprise (SMEs)