This document discusses business sizes and their impacts. It defines micro, small and medium, and large businesses based on employee count. Small and medium enterprises (SMEs) are defined as having between 0-249 employees. SMEs make up over 96% of companies in the US and EU and account for a significant portion of employment and value added. The document also discusses statistics on SMEs and their impacts in countries like the UK, US, and Vietnam. SMEs play an important role in job creation, innovation, and economic growth through competition and knowledge spill-overs.
2. • Micro business
• Small and Medium Size enterprises
(SMEs)
• Large businesses.
Definitions
3. Micro: 0 - 9 employees (about 95%)
Small: 9 – 49 employees (about 4%)
Medium: 49 – 249 employees (< 1%)
Large: 250 or more employees
SME: 0 – 249 employees
EU definition of
small firms
4. Usually <500 employees, but varies based
on industry, ownership structure & revenue
US definition of SMEs
5. • SMEs size: 1-249 people employed
– Small Business: 10-49 employees
– Medium Business: 50-249 employees
• represent 96% of the total stock of
companies
• employ 47% of the labour force
• account for 36% of national value added
SMEs in Vietnam
Source: OECD (2021) SME AND ENTREPRENEURSHIP POLICY IN
VIET NAM
9. ØSMEs in USA are larger but self-
employment rates not necessarily higher
ØNew firms in the USA expand more rapidly
ØMore productive SMEs in the USA have
greater tendency to increase their market
share
USA compared to EU
10. ØMore SuperEntrepreneurs in the USA
ØUS markets probably more competitive
with fewer barriers to growth
USA compared to EU
11. ØRepresent 99.9% of firms
ØGenerate 60% of employment
ØGenerate 52% of turnover
ØHave a 40% chance of surviving 5 years
Impacts of SMEs in
the UK
12. • New Jobs
• Innovations
• New opportunities
• Creative Destruction
• – the way that newly created goods,
services, or firms can hurt existing
competitors
Small Business and
the Economy
13. SMEs’ Contributions in
Vietnam
Pham Thi Tuyet Trinh, Nguyen Duc Thanh (2017). DEVELOPMENT
CHARACTERISTICS OF SME SECTOR IN VIETNAM. VEPR Working
Paper
15. ØIt encourages competition by increasing
the number of enterprises
ØIt is a mechanism for transferring
knowledge - ‘knowledge spill-overs’
ØIt generates diversity & variety among
enterprises
Why entrepreneurship
encourages economic
growth
19. 1. Are Babbage and
Hull entrepreneurs?
Explain.
2. What personal
qualities does Hull
possess that
Babbage did not?
Charles Babbage & Chuck Hall
CASE
insight
19
22. ØGazelles, unicorns & profitability
ØFirm size
ØIndustry structure
ØIndustry age & stability
ØLocation
Linkages with
innovation
23. ØEntrepreneurial SMEs play a significant
role introducing radical, disruptive
innovation
ØSMEs are less important in stable, mature,
high-concentration industries where the
focus has switched to efficiency & cost-
reduction
Linkages with
innovation
24. ØLarger firms have a significant resource
advantage over smaller firms & can be
more productive generally
ØSmaller firms thrive in industries where
economies of scale are less important to
customers
Linkages with
innovation
26. 1. What was the role of Oxford University in launching
Vaccitech?
2. Should universities generally see greater rewards
for their scientific breakthroughs? If so, how can
this be achieved?
https://www.youtube.com/watch?v=uTrVWi09ZSQ
Vaccitech
CASE
insight
26
28. 1. How important was the link
with Cambridge University
for Astex when it started?
2. In the age of the internet,
how important is
geographic proximity to
sources of knowledge in
encouraging innovation?
Explain.
https://www.youtube.com/wat
ch?v=yKZMxcc1h1M
Astex Pharmaputics
CASE
insight
28
29. 1. Explore the statistics about start-ups and SMEs in your
country. What does this tell you about recent
developments and the impacts of SMEs on the economy?
Summarize your findings in a report
2. Access the latest GEM report for your country and
summarize its findings in a report
Activities
29
