Question

What do you mean by small business? Describe the features of small scale enterprise?​

Answer 1

Answer:

Characteristics of Small Scale Industries

Ownership: Such units are generally under single ownership. So it is a sole proprietorship or sometimes a partnership. Management: Both the management and the control generally is with the owner/owners. ... Limited Reach: Small scale industries have a restricted area of operations.

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Answer 2

Explanation:

Features of Small Business:

It is not correct to say that the days of small industries are gone. Eugene Staley has mentioned five distinct ways in which small industries suc­cessfully coexist with large industry.

1. Competition:

Small industry can out-compete large industry in certain circumstances and in selected products. Some of these industries are bricks and tiles, fresh baked goods, condiments and preserved fruits, goods requiring small engi­neering skill, items requiring artistry and craftsman­ship.

2. Supplementary:

Small industry can “fill the cracks” between the big volume and standardised outputs of large factory. Staley mentions a Madras case where a small tricycle factory flourished along­side a large cycle factory.

3. Components:

A small industry can produce components for a large industry. This is the most common example of the small manufacturing sec­tor and many of them function under the protec­tion of big industries. Very often they also derive the advantage of a protected market with assured supply of their output to one or more selected large manufactories.

4. Initiation:

Small industry can initiate new products and subsequently grow large with the growth of the product. Staley mentions that many of the automobile factories started this way in USA. In India, the electronics industry looks like taking to this pattern of development.

5. Servicing:

Small industry can install serv­ice, and repair the products of large industry. In India these industries are growing in respect of major industries like refrigerators, radio and TV sets, watches, and clocks, cycles and motor cycles and motor vehicles in respect of repair, servicing and maintenance.

It is thus obvious that growth of large scale industries does not necessarily bring about the end of cottage or small scale industries. Electricity has revolutionised large-scale industry; at the same time small units based on electricity can also be cheaply and conveniently started with limited infrastruc­ture.

Besides, many artistic goods, products of craftsmanship, and luxury goods do not lend them­selves to standardisation of large scale manufac­turing and are largely reserved to the cottage, rural and small industrial sectors.

Finally new ventures, so long as they are in an experimental or formative stage are first tried on a small scale and it is only when their success is dem­onstrated and their profitability and capital base established that they are organised on a large scale.

Small business always plays an important role in the development of any country. As already mentioned, most of the industrial and business activities starts small. With market opportunities and vision of the entrepreneur, it grows into a large industry.

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