Definition Of Smes : Small And Medium Sized Enterprises ( Smes )

1158 Words Apr 21st, 2016 null Page
Definition of SMEs
According to the OECD (2005) small and medium sized enterprises (SMEs) are non-subsidiary, independent firms which employ less than a given number of employees. This number varies across countries; the most frequent upper limit is 250 employees, as in the European Union (EU). However the United States (US) considers SMEs to include firms with fewer than 500 employees. Small firms are those with less than 50 employees and micro firms would be made up of less than 10 employees.
Nature of SMEs
Hollensen (2014) highlights that many SMEs suffer from limited human and financial resources as a result many outsource. Although SMEs are customer orientated most want to look after home customers first and overseas customers come second, so no effort may be made to distinguish between customers.
Some SMEs such as Mc Donald’s develop products, price products and promote products specifically for a certain market, however this can be very costly and you need to be very large to adopt this approach (EXPLAN MC DONALD’S APPROACH).
The National Academy Press (2000) emphases that SMEs must cater to the customer’s needs, which increasingly include supply chain interaction. This means providing low cost, high quality products, effective service and on time delivery. They should know their customers intimately at all levels in the organisation and cater to specific needs at each level. However as a result of the lack of resources many SMEs may not have sufficient…

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