Question

Reason why small firm survive despite the advantage of large firms

Answer 1

Answer:

Desire for Independent Business:

When there is shortage of capital and some persons do not want to undergo any service, development of small scale industries comes to their rescue. Because of the small capital requirements, the small scale producers have flourished in the capital-scarce countries.

Answer 2

Small firms have limited operations due to which they tend to survive even when they have limited resources.

Explanation:

1. A small firm is generally managed by a limited number of people. Due to this, the decision-making process is quite fast and unnecessary delays are not present.
2. In addition, a small firm specializes in only a limited number of products. As a result, even when limited resources are available to them they still continue to survive and even grow in the competitive market.
3. A small firm generally focuses more on the quality of their products due to which they are able to survive.