Importance of Small-Medium Enterprises in Australia

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Importance of Small-Medium Enterprises in Australia

By | April 2008
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Business Studies – Extended Response Question

Executive Summary
This business report was created in order to outline the characteristics of small businesses, and also to explain the importance of these small businesses to the Australian economy. This report aims to achieve its purpose through the use of several Australian small businesses as examples. The businesses examined are: “Laservision Australia”, “Luken and May”, and “Peter Alexander”.

Characteristics of Small Businesses
Although there is no universally accepted definition of a small business, small businesses are generally identified through reference to quantitative measurements, and qualitative descriptions.

Quantitative
A quantitative measurement is one which exists in a range of magnitudes – it can therefore be measured. Examples of quantitative measurements used to describe the characteristics of small businesses include: -The number of staff a business employs. The most common measurement used to determine the size of a business falls under the quantitative measurement of: the number of employees a business utilizes. A business is considered small if it is a manufacturing enterprise with fewer than 100 employees, while non-manufacturing enterprises are considered small if they have fewer than 20 employees. Luken and May, for example, is classified as small due to the fact that, as a non-manufacturing business, it has fewer than 20 employees. -The estimated number of businesses operating (in Australia, this figure rose to over 1.3 million small businesses in January 2005) -Approximate share of Australian businesses compared to medium sized and large businesses. Approximately 95% of all Australian businesses are classified as small, with the other 5% being either medium or large businesses.

Qualitative
A qualitative description is used in order to describe certain types of information. Qualitative data is described in terms of quality. Examples of qualitative descriptions...