Sme Sector In South Arica

CHAPTER 2 AN OVERVIEW OF SME SECTOR IN SOUTH AFRICA 2.1 INTRODUCTION 2.2 spirit of SMEs Researchers and scholars have failed to act up with a universally original definition of SMEs. A number of countries define SMEs based on the characteristics of the market in which the enterprise operates which has led to most countries shaping SMEs based on the level of economic development (Analoui and Al-Madhoun, 2006:2). The pursuit section highlights on the major(ip) characteristics of SMEs: Characteristics of SMEs Pandey, Prasad and Shivesh (2007:2) identify the following characteristics in SMEs: ?Born by of individual initiatives &skills ?Greater operational tractability ?Low cost of production ? higher(prenominal) propensity to adapt technology ? eminent capacity to innovate & export ?High use of goods and services orientation ?Utilization of locally available human & panoptical resources ?Reduction of regional im agreements There atomic number 18 other featu res which atomic number 18 essential for SMEs as well as the above mentioned for instance, contribution towards growth house servant product, providing a nationwide pool of skilled and trained manpower and enhancing hearty life in the country.

The characteristics differ according to dissimilar countries though a number of common elements are identified much(prenominal) as number of employees, turnover and assets. Based on these facts, in that respect is need to define SMEs comprehensively in legal blemish of international and South African perspectives. The International Perspective The European league Commission defines SMEs b ased on three major components which are the! number of employees, the firms turnover and the balance sheet. As from 1 January 2005, the Union classified SMEs if the criterion verbalise in the table which follows is met (European Commission Enterprise and Industry, 2005); Enterprise social class passing CountTurnoverBalance Sheet Medium sized little than or equal to 250Less than or equal to 50 one one million million million poundsLess than or equal to 43 million pounds SmallLess than or to...If you want to get a full essay, order it on our website: BestEssayCheap.com

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