SMALL BUSINESS

Presented By:

Anu.M.Anand S4 MBA

SMALL BUSINESS

The concept of small business has been defined by different countries in different ways. The two main criteria used to define small business are;

SIZE OF THE BUSINESS QUALITATIVE CRITERIA

A small business is a business that is privately owned and operated, with a small number of employees and relatively low volume of sales.

ROLE OF SMALL BUSINESS

1)

Employment potential Small scale firms use labour-intensive techniques and, therefore, they have high potential to provide employment to a larger number of people per unit of capital. For every worker employed in large scale industries about three workers are engaged in small scale and cottage industries.

2)

Capital intensity small scale industries are capital light and so they are most suited to an economy like that of india where capital is inadequate.

3)

Export potential Small Scale Industries Sector plays a major role in India's present export performance. SSI Sector contributes 45%-50% of the Indian Exports.

4)

Balanced Regional Development The tendency of large scale manufacturing concerns to get concentrated in the suburbs of metropolitan cities and big towns is a problem which causes severe head ache to the planners of india, because it leads to non equitable dispersal of industries and disproportional concentration of economic power which in its turn leads to regional imbalances.

5)

Exchange Earnings Small scale industries help in reducing pressure on the country's balance of payments in two ways. Low cost Small industries also enjoy the advantage of low cost of productionLocally available resources are less expensive in small business.

6)

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Promotion of rural development indias economy being mainly agrarian, people living in rural areas have a tendency to keep their savings dormant than investing them in large scale business. Low import intensity small scale industries are import lightin other words, they need mostly machines which are manufactured indigenously.

8)

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Proper utilization of local resources Support to large scale industries

10)

11)

Even distribution of income and wealth

REFERENCE

1.

Entrepreneurship Development Dr.KGC Nair, Dr. Jayan, Dr. Hari, Dr. Biji
http://freemba.in/articlesread.php?artcode=153&st code=8&substcode=11 www.scribd.com

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