What is the difference between a small business and a medium business. What business is considered small or medium? The main differences between small business and large business

Not many people know the difference between small, medium and large businesses. To understand the differences between these concepts should, especially, a novice entrepreneur. In the case of defining the idea of ​​entrepreneurship and writing a business plan, you should have ideas about the future occupation.

What it is

Small business is the most common form of entrepreneurship, which is chosen by most start-up businessmen.

Medium business̶ it is a form of entrepreneurial activity that, in comparison with a small business, has a more impressive annual income and more extensive and diverse resources for commercial activities.

Big business is a form of entrepreneurship that includes popular companies covering an entire country or more than 2 countries of the world, as well as having a strong demand from consumers.

Key Features of Entrepreneurship

Each form of commercial activity ̶ SMEs or big business has its own characteristics, which makes them different from each other.

small features

Small businesses are not only individual entrepreneurs, but also companies whose average annual number of employees is at least 50 people.

The territorial activity of these companies is small, and the list of their areas of activity may include:

• the shops;
• firms with a small production that produce small volumes of goods;
• companies with tourism activities;
• medical offices (dental, etc.);
• various training courses, etc.

For small businesses, the period for conducting inspections has been reduced and annually is no more than 50 hours.

Until December 31, 2018, these businesses are granted a two-year supervisory vacation, during which no supervision will be carried out. Sanepidemnadzor and fire inspection visits are not threatened, and the activity license will not be checked.

According to part 2 of article 10 of the Federal Law “On the protection of the rights of legal entities and individual entrepreneurs in the exercise of state control (supervision) and municipal control”, upon receipt of complaints from consumers about violations of the law, an audit will be carried out.

In 2018, entrepreneurs who:

• register for the first time;
• carry out industrial, social or scientific activities;
• provide services to the public.

Small businesses do not need proof of status. It is only necessary to adhere to the above limits (income, number of employees and share in the authorized capital). If the limits were exceeded within 1 or 2 years, then this is not a reason for losing status. In this case, it will be kept for 3 calendar years.

signs of mean

Compared to a small business, medium business includes entire networks of enterprises working for a large consumer audience. This entrepreneurial form can carry out its activities not only within the whole city, even within the region.

Compared with small businesses, where a large role is assigned to staff, on average - the quality of goods (services) is put in the foreground. Since the average enterprise is not large, it will not be difficult for it to adapt to changing market conditions.

Large or big business

Large businesses can spend money advertising their products on the most popular television channels. In different cities and countries, this form of business has its own branches and representative bodies, employing hundreds of thousands of employees.

The subjects of large business are large companies that:

• engaged in the production of equipment: Apple, Bosch, Samsung, Lenovo, etc.;
• produce food products: MC.Donald, Nestle, Coca Cola, etc.;
• produce vehicles of automobile brands: Ferrari, Bogati, Alfa Romeo, BMW, etc.

The criteria are easy. In order to be a major entrepreneur, you must meet the following:

• have at least 251 employees:
• receive income of at least 2 billion rubles;
• timely inventory and revaluation of fixed assets.

Since 2016, a unified register of SMEs has been operating, which contains enterprises that have received the status of SMEs.

These forms of entrepreneurship acquire the status of SMEs if they meet the criteria below:

• have a certain amount of income;
• have a certain number of employees;
• have a certain share of participation of other companies in the authorized capital.

According to article 4 of the Federal Law "On the development of small and medium-sized businesses in the Russian Federation", these limits do not apply:

• persons holding shares in the economic high-tech sector;
• persons participating in the Skolkovo project;
• companies that practically apply the latest technologies developed by their owners ̶ budgetary and scientific institutions;
• companies whose founders are included in the government list of persons who provide state support for innovation.

If an individual entrepreneur does not have employees, then his status is determined by the criterion of their annual income. If individual entrepreneurs and LLCs were included in the unified register of SMEs for the first time, then their status should be determined by the criterion of the number of employees.

If an enterprise receives the status of an SME, then certain benefits are provided to it, namely:

• the right to keep as much money in the cash register as you want and there will be no fine for this.
• the ability to maintain simplified accounting. This does not apply to individual entrepreneurs, since they are not required to keep records. And companies are required to charge annual depreciation, and not once a month.
• endowed with an advantage in the purchase of state and municipal real estate, etc.

List of enterprises that meet the specified criteria, annually formed by the Ministry of Industry and Trade of the Russian Federation. This list is provided to the Federal Tax Service of Russia, after which certain information is entered in the register by the tax authorities.

We bring to your attention a video that talks about why big business wins.

Main advantages

Both SMEs and large companies have their own strengths and weaknesses.

The list of advantages of small business is as follows:

• the presence of a small need for initial capital;
• relatively low costs during the implementation of entrepreneurial activities;
• availability of a quick response to changes in the market sphere;
• the presence of a relatively fast turnover of equity capital;
• the trend of growth of vacant vacancies, which has a beneficial effect on the increase in populated employment.

The main advantages of medium-sized enterprises are:

• creation of new places of employment;
• high productivity of capital investments;
• relatively high profitability;
• high competitiveness and mobility.

Big business is also endowed with positive qualities, namely:

• the ability to ensure economic stability in the country;
• the ability to change the external business environment;
• the ability to save on production costs;
• implementation of modern technologies in business, etc.

Cons and risks

In order to start building your business, an entrepreneur must familiarize himself with the main disadvantages of various enterprises. For example, small business has the following disadvantages:

• relatively high level of risk;
• dependence on big business;
• the presence of a low professional level of managers;
• difficulties in obtaining loans and subsidies.

The size of the initial capital also matters. For example, if this size is large, then the firm will be able to hold out during the crisis period.

Medium business also has certain disadvantages, namely:

• the presence of fierce competition and the threat of being taken over by large companies;
• the presence of barriers and difficulties in obtaining a license and patents;
• frequent shortage of working capital;
• difficulties in obtaining loans due to lack of confidence in banks.

Big business is also not without problems. The main disadvantages of this business are the presence:

• excessive economic concentration;
• localization of economic relations;
• blocking horizontal commercial links that do not go beyond a particular company.

Differences among themselves

For a clear example of the differences between small medium and large businesses, we can cite the following table.

Basis for success

Despite the dependence on the external environment, small business can also be successful. Only the best employees in their field work here. The success of this business is determined by having a strategic plan for the development of the enterprise.

Medium business can easily adapt to changing market conditions. Success also depends on having effective management.

The main success of a large enterprise is the presence of effective business models that are built in such a way that even after 10 years they continue to work, surviving crisis situations and bringing huge income.

Regulatory regulation

Questions regarding the implementation of entrepreneurial activities by SMEs and large companies, governed by a number of laws, namely:

1. Federal Law "On the protection of the rights of legal entities and individual entrepreneurs in the exercise of state control (supervision) and municipal control" dated December 26, 2008 No. 294-FZ.
2. Federal Law "On the development of small and medium-sized businesses in the Russian Federation" dated July 24, 2007 No. 209-FZ.

Small business in Russia enjoys special, intended only for him, benefits. The state is trying to reduce the tax and administrative burden of small businesses, receiving in return an increase in employment and a decrease in social tension. What does the definition of “small business entities” mean and who are they in 2020?

A small business entity is a Russian commercial organization or an individual entrepreneur who is aimed at making a profit. Also included in this category are:

• peasant (farm) farms;
• production and agricultural cooperatives;
• business partnerships.

A non-profit organization, as well as a unitary municipal or state institution, is not a small business entity.

Who belongs to SMEs

The criteria for classifying small businesses in 2020 are established by the state. The main requirements, subject to which it is possible to classify a businessman as a small and medium-sized business (SME), relate to the number of employees and the amount of income received. Who is the SME, i.e. refers to small businesses, defines the law of July 24, 2007 N 209-FZ in article 4. Let's consider these criteria, taking into account innovations.

Thanks to the amendments made to Law No. 209-FZ, a greater number of enterprises and individual entrepreneurs can be classified as small businesses.

• The maximum allowable amount of annual revenue without VAT for the previous year for micro-enterprises increased from 60 to 120 million rubles, and for small enterprises - from 400 to 800 million rubles.
• The permitted share of participation in the authorized capital of a small enterprise of other commercial organizations that are not subjects of small and medium-sized businesses has increased - from 25% to 49%.

But the allowable average number of employees has not changed: no more than 15 people for micro-enterprises and no more than 100 people for a small enterprise.

For individual entrepreneurs, the same criteria for dividing into business categories apply: by annual revenue and number of employees. If an individual entrepreneur has no employees, then his SME category is determined only by the amount of revenue. And all entrepreneurs working only on the patent system of taxation are classified as micro-enterprises.

The period during which a businessman continues to be considered an SME has been extended, even if he has exceeded the allowable limit on the number of employees or the revenue received. Until 2016 it was two years, and now it is three. For example, if the limit was exceeded in 2017, then the organization will lose the right to be considered small only in 2020.

What to do in a situation where the status of a small enterprise is lost due to the achievement of the previously existing limit of 400 million rubles, because it is lower than the current one? The Ministry of Economic Development believes that after the act of the Government of the Russian Federation dated July 13, 2015 No. 702 comes into force, such an enterprise can return the status of a small one if the annual revenue does not exceed 800 million rubles.

State Register of SMEs

Since mid-2016, the Unified Register of Small and Medium-Sized Businesses has been in operation. A list is posted on the portal of the Federal Tax Service, which includes all subjects of small and medium-sized businesses of the Russian Federation. Information about SMEs is entered into the register automatically, based on data from the Unified State Register of Legal Entities, EGRIP and tax reporting.

The following mandatory information is publicly available:

• the name of the legal entity or the full name of the individual entrepreneur;
• TIN of the taxpayer and his location (residence);
• the category to which small and medium-sized businesses (micro, small or medium enterprises) belong;
• information about activity codes according to OKVED;
• an indication of the presence of a license, if the type of activity of a businessman is licensed.

In addition, according to the application of a businessman belonging to small and medium-sized businesses, additional information can be entered in the register:

• about the manufactured products and their compliance with the criteria of innovative or high-tech;
• on the inclusion of an SME entity in partnership programs with government customers;
• on the existence of contracts concluded as a participant in public procurement;
• complete contact information.

To transfer this data to the Unified Register, you need to log in to the information transfer service using an enhanced qualified electronic signature.

After the formation of the official register, small businesses are no longer required to confirm with documents that they correspond to this status in order to participate in state support programs. Previously, this required the provision of annual accounting and tax reporting, a report on financial results, and information on the average number of employees.

You can check the information related to small and medium-sized businesses, and their reliability, by making a request for information on the TIN or name in the Register. If you find that there is no data about you or they are unreliable, then you must send a request to the Registry operator to verify the information.

What gives the status of a small business entity

As we have already said, the state creates special favorable conditions for entrepreneurial activity for micro and small businesses, pursuing the following financial and social goals:

• ensure a way out of the shadows and self-employment of persons providing services to the population, engaged in small-scale production, working as a freelance;
• create new jobs and reduce social tension in society through the growth of the population's well-being;
• reduce budget spending on unemployment benefits, health insurance and pensions for officially unemployed persons;
• develop new activities, especially in the field of innovative industries that do not require significant costs.

The easiest way to achieve these goals is to make the state registration procedure simple and quick, reduce administrative pressure on businesses, and reduce the tax burden. In addition, targeted financing in the form of non-repayable subsidies has a good effect on the activities of start-up entrepreneurs.

The main list of preferences for small businesses looks like this:

1. tax incentives. Special taxation regimes (STS, UTII, ESHN, PSN) allow you to work at a reduced tax rate. Since 2016, regional authorities have the right to additionally reduce taxes on UTII (from 15% to 7.5%) and on the STS Income (from 6% to 1%). On the simplified tax system Income minus Expenses, the opportunity to reduce the rate from 15% to 5% has existed for more than a year. In addition, from 2015 to 2020, individual entrepreneurs, first registered after the entry into force of the regional law on, have the right not to pay tax at all under the PSN and STS regimes for two years.
2. Financial perks. This is direct financial state support in the form of grants and gratuitous subsidies issued under the all-Russian program valid until 2020. Funding can be obtained to reimburse leasing costs; interest on loans and credits; to participate in congress and exhibition events; co-financing projects (up to 500 thousand rubles).
3. administrative benefits. This refers to such concessions as simplified accounting and cash discipline, supervisory holidays (limiting the number and duration of inspections), the ability to draw up fixed-term employment contracts with employees. When participating in public procurement, there is a special quota for small businesses - at least 15% of the total annual volume of purchases by state and municipal institutions are required to be made from them. When obtaining loans, government guarantors act as guarantors for small businesses.

Everyone knows such concepts as "small business" and "medium business". When registering a company, an entrepreneur is given a questionnaire, one of the points in which is to determine which business entity is being registered - small or medium. However, not everyone knows the differences between small and medium businesses. Today we will try to shed some light on this topic.

1. The concepts of medium and small business are divided on the basis of legislative acts. To classify an enterprise into one or another group, it is necessary to take into account the following factors:
2. Number. If the company employs 16-100 people, then it belongs to a small business, if 101-250 - to a medium one. Firms with 1-15 employees are called micro-enterprises and can also be classified as small businesses.
3. Income from the sale of goods or services/value of assets. These values ​​are established by the Tax Code with a frequency of five years.

The percentage of state ownership and foreign investors (for both types of enterprises no more than 25%).

At enterprises related to small businesses, the number of employees is in the tens. Such firms have a more or less formed corporate structure and regulation of business processes.

The key to small business success is people. The main value of any small company is qualified employees, professionals who love this business and strive for one common goal. The interaction of employees is very close, and if they get mutual understanding regarding the main goal of the company, it moves forward confidently.

Small businesses include all legal entities that have an average annual number of employees of no more than 50 people.

Medium business

Speaking of medium business, we already mean a company that employs a couple of hundred people. Sometimes employees are geographically separated. In such companies, there is already a clear and regular management, which is easy to maintain due to the relatively small size of the company (compared to large business). Medium business has more resources than small business.

The main key to the success of a medium business is production and sales. In this business, any troubles and misunderstanding of each other by individual employees can hardly have a significant impact on the success of the company, so the main emphasis should be placed on the high-quality manufacture of products (or the provision of services) and the competent presentation of it to consumers.

Medium-sized businesses include all individual entrepreneurs and legal entities that have an average annual number of employees of more than 50 people.

Differences in lending to small and medium businesses

Different banks often use their own criteria to determine which business entity a particular enterprise belongs to. ie. These criteria are established on the basis of intra-bank methods of company analysis. Therefore, it may happen that when analyzing one bank, a particular company will be referred to as a small business, and another bank as a medium business.

For small businesses, there are clearer and more specific lending programs with clear names such as "business development" or "business growth". In the case of medium-sized enterprises, banks more often use an individual approach. Based on the goals and needs of a particular company, the size and terms of lending are determined.

We can say that lending to medium-sized businesses has some advantages for business owners, as an individual approach is always more convenient and profitable than a standard program with clearly defined terms.

The main indicator that allows you to recognize the enterprise as small is the number of employees for a specific period of time. Criteria such as the size of its assets, the size of the authorized capital and the annual turnover also matter.

In Russia, a small business is a commercial organization, in the authorized capital of which the participation of constituent entities of the Russian Federation, charitable and other foundations, as well as religious and public organizations does not exceed 25 percent. In addition, a share that belongs to several legal entities or one legal entity. face, should also not be more than 25 percent.

The number of employees for a certain period should not be higher than the standard established in a particular area. If it is construction, industry or transport, the number of employees of a small enterprise cannot exceed 100 people. If it is a wholesale trade - no more than 50 people, if it is a consumer service or retail trade - no more than 30 people, if any other activity - no more than 50 people.

Medium enterprises

The definitions of medium and small business around the world are quite close. What generalizes them is economic entities that do not exceed a specific indicator in terms of the number of employees, the amount of gross assets and turnover. Medium enterprises are also eligible for simplified reporting. In order to understand the scope of the number of employees - after all, this criterion is most often the main one - it is worth considering a few examples.

If we take a consulting or research agency, it can be classified as a medium-sized enterprise when the number of its employees ranges from 15 to 50. If we talk about a travel company, then it can be classified as a medium-sized enterprise when the number of its employees is in the range from 25 to 75. Medium print media will be an editorial office with no more than 100 employees. As with small businesses, medium-sized businesses are considered in terms of turnover and market share they occupy.

Large enterprises

A large enterprise is a company that produces a significant share of the total commodity volume of any industry. It is also characterized by the number of people employed in the work, the size of assets and sales. To classify an enterprise as a large business, it is necessary to take into account the territorial, industry and state specifics. For example, for the field of mechanical engineering, the main factors are the volume of products, the number of workers and the cost of fixed assets. If we take the agro-industrial complex, we can focus only on the number of livestock or the area of ​​land.

Small business (small business) the activity carried out by certain subjects of the market economy, having the signs established by law, constituting the essence of this concept, is recognized. As world and domestic practice shows, the main criterion on the basis of which enterprises (in an organization) of various organizational and legal forms are classified as small businesses is the average number of employees employed at an enterprise (in an organization) during the reporting period. In a number of scientific works, small business is understood as an activity carried out by a relatively small group of persons, or enterprises managed by one owner.

Small business entities are also individuals engaged in entrepreneurial activities without forming a legal entity.

A small business has a number of features:

- employees make up a small team united by common goals;

- the work uses interchangeability and mutual assistance;

- high intensity of activity of employees, which is due to a heightened sense of personal responsibility;

- Innovations of the leader are quickly implemented.

The benefits of small businesses include:

· - an opportunity for many citizens to become co-founders (due to small initial investments in fixed and working capital);

· - the possibility of using local raw materials and production waste;

- Creation of new jobs;

· - a small administrative apparatus in comparison with large enterprises and, as a result, lower overhead costs;

· - the revival of ancillary industries and folk crafts;

· - assistance to economic and social development of small towns and small settlements.

In addition, participation in small business allows you to unlock your creative potential, realize the activity and ability to work of millions of citizens, fill the market with the necessary goods and services.

Medium business. In Russia, there is still no clear definition of the concept of "medium business", that is, they do not distinguish it as an independent unit of economic relations. Basically, the concept of medium business goes "hand in hand" with the concepts of small and large businesses and remains in the background as a "burden" to enterprises in these categories.

There are no signs by which an enterprise can be attributed to an object of medium business, as well as how exactly a medium business differs from small and large ones. This looks at least ridiculous, because even if we assume that the gross production of goods and services in the country by large businesses is 50%, and small businesses - 15%, then the gross production of medium-sized businesses accounts for 1/3 of all goods and services, and this is not enough. In fact, in Russia even now there is no clear distinction between the concepts of medium and small businesses.

Medium-sized companies are, as it were, an unspoken intermediary between large and small businesses. Until now, unlike small businesses, large and medium-sized businesses do not have a legal status. Medium business is in the middle between large and small, and is their intermediate layer.

Medium-sized businesses act as "connectors" of large and small enterprises, and the state and small enterprises.

There is such a thing as the network economy. It is medium-sized enterprises that have taken on the solution of the main tasks of large and small businesses, since these two categories of companies do not have the opportunity to cooperate directly. This is due to the fact that small businesses have market volatility, high-risk activities and small firm sizes.

Medium business companies help regulate organizational and legal issues that arise between large and small businesses. That is, medium-sized businesses form links with small and large businesses that are different in design and form.

The network economy has a structure that consists of three tiers: the upper tier is represented by representatives of large businesses, the lower tier is small, and the intermediate tier is occupied by medium-sized businesses that form the economic network.

Medium Business Criteria

You can still try to highlight the main criteria by which it is possible to identify representatives of medium-sized businesses:

The number of employees who work in the enterprise. Although this category has its own characteristics - it all depends on the industry. For example, a publishing enterprise can be considered medium if the number of employees is 15-20 people, and a car factory if it employs 10-40 thousand employees.

The turnover of the enterprise, although in this case it all depends on what it does. Currently, a medium-sized enterprise in Russia is considered to be one that has a turnover of 12-50 million dollars a year.

Part of the market occupied by the enterprise. Medium-sized companies can be called those whose market share is 1-2.4%.

Big business. There is no definition of big business. Such businesses include companies such as Coca-Cola, General Motors and other well-known large companies.

The main function is that these companies provide a high market economy for the country and the world. They produce the bulk of the products. It can even be said that thanks to big business, the rest of the business lives in the world. Basically, there are 3 reasons for the growth of such companies.

1. Technological economy - that is, this is the company's desire to save resources in production. It is achieved by increasing the volume of output by reducing costs. The company achieves such results by strengthening labor, raising the classification of workers, and introducing automatic equipment.

2. Increase the variety of products produced, this type is called the company's desire for economies of scale in the field of activity. Thanks to such an economy, large, global companies are formed. To form such corporations, such types of tools as vertical integration and diversification are used.

3. The third type is when the company saves on transaction costs. These costs are associated with the fact that there is a transition of goods from one technological structure to another. Reduction is achieved through vertical integration and diversification.

But, like any other type of business, a large one also has its drawbacks. As the firm grows, the effectiveness of its management decreases. Many types of large businesses have an inflexible system, as they can regulate the demand for the price of their products.