Small Business: Pros and Cons – Does It Worth It?

Small business is now an important part of the economy in every country today. It plays a role in generating extra employment, innovations, and economic development. Widely used entrepreneurship forms, for many long years, have seen constant and increasing growth. 

What Business Is Considered Small?

Due to the large number of such enterprises, small entrepreneurship is the most dynamic economic sector . It is able to quickly adapt to market changes. It becomes the basis for economic growth, the creation of new labor markets, and an improvement in the standard of living of the population.

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What Is the Difference Between a Small Enterprise and a Microenterprise?

Small enterprise and microenterprise are concepts used to determine the size of a company. Both terms refer to small enterprises. But they have their own characteristics and differences.

According to various criteria, a small enterprise can be a company that has no more than 100 employees. It can be a manufacturing company or a small industrial unit, a retail outlet, a restaurant, or any other business. There are often various forms of ownership that can characterise small business. It ranges from Sole Trading to a Joint Stock Company.

In fact, a microenterprise differs from a small enterprise in size of the business. Actually it is a company which has up to fifteen employees. It could be a small family business, new business or a sole trader business. Such enterprises often have a very small capital and their overall financial capacity can hardly be referred to as large. Therefore, many of them tend to focus on a specific area of their operation or provide certain distinct services.

Another differentiation criterion focuses on the number of employees; other differences are mostly quantitative. This means that a small business on average can have up to 100 employees while a micro business only 15. This is because micro businesses are always regarded to be more niche with most of them being single shot.

The only other major difference that can be pointed out between small businesses and micro businesses is their business structure.

 Small businesses often have a more complex structure. They have different departments and management levels. While micro businesses tend to have a simpler structure because they operate in a narrower area.

Small businesses and micro businesses may have different legal statuses and registration requirements.

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Advantages of a Small Business

Small businesses have a number of other attractive features.

Small businesses give you the opportunity to turn dreams and ideas into reality. Every person has its own abilities, which can be used in the business sphere. Small businesses are useful because it gives individuals the opportunity to implement even the most ambitious ideas.

Small scale businesses adapt easily to changes in the market. One more advantage of carrying out its activity is the ability effectively to react to new conditions and changes in the demands of consumers.

Constant is the principle of this form of business which serves as the driver of economic growth. Creation of new workplaces, the rise in the standard of living of population and stimulating economic growth in the country is associated with activity of small companies.

Also small businesses play a role in the development of innovations and new technologies of production. This in turn results in enhancement of the quality of life.

Small business entities too are more sensitive to their customers and the society at large. Most small business leaders identify their customers and make sure to attend to their needs as required. Also, small businesses are engaged in charity programs, for instance. They fund social causes of concern in their entailing region.

Small businesses are a good opportunity to realize oneself and become financially independent. Small business people are able to determine their earnings and are also in a position to fully manage their own time. Small businesses can become an excellent platform for developing personal skills and professional growth.

Thus, small businesses have advantages that make them an important element of the economy of any country. They enable people to realize their creative potential. They respond flexibly and quickly to market changes. They are the basis for economic growth and development. They have greater responsibility to their customers and society as a whole. And they are also an excellent opportunity for personal fulfillment and achieving financial well-being.