Advantages of Small and Medium Enterprises

  • Help to tap available resources, locally available resources are put to use by these enterprises which reduce resource under – utilization.
  • These is easy decision making. In small and medium enterprises, decision making is easy since there are few people involved in the business.
  • They require relatively less capital to start. Most people in rural areas have small amount of money that cannot start large enterprises
  • They have low operational costs. They don’t spend much money on rent, transport and factor in put thus low costs involved.
  • They facilitate flexibility in operation. They are easily transferred from one location to another and output is also easy to vary to demand.
  • Provide employment chances to family members. Most labour employed is family members with few hired experts.
  • Require small market size. Small and medium enterprises produce on small scale and sell affordable quantities customers.
  • There is potential contact with customers. Enterprise owners are directly involved in marketing and selling their products which creates personal contact with customers.