US Categories
In the US, there is no clear definition for the criteria as it varies per industry and within industry. For example, what's considered SMEs is when a manufacturing company has less than 500 employees, while a trading company has less than 100 employees. In the mining industry, what's considered an SMEs are a Nickel ore mining business with 1,500 employees or less, and a Silver ore mining company with only 250 employees.
European Categories
However in Europe, a company with a headcount of 250 or more and with a revenue of 43m euro is considered medium-sized. Employee head count with a tipping numbers of 250, 50 and 10 would account to the classification of a company whether it falls under Micro, small or medium-sized.
| Comparison of the European Union (EU) SME Definitions | |||
|---|---|---|---|
| Company Category | Staff headcount | Turnover or Balance sheet total | |
| Medium-sized | < 250 | ≤ € 50 m | ≤ € 43 m |
| Small | < 50 | ≤ € 10 m | ≤ € 10 m |
| Micro | < 10 | ≤ € 2 m | ≤ € 2 m |
Philippine Categories
In the Philippines, the definition is ruled under Republic Act no. 9501 base on the Magna Carta for MSME, which states that an MSME is 'any business activity or enterprise engaged in industry, agri-business and/or services that has: (1) an asset size (less land) of up to P100m; and (2) an employment size with less than 200 employees.
| Philippines SME Classification | |||
|---|---|---|---|
| Company Category | Staff headcount | Total Asset | |
| Medium-sized | 100-199 | P 15,000,001 - P 100m | |
| Small | 10-99 | P 3,000,001- P 15m | |
| Micro | 1-9 | ≤ P 3 m | |
In 2010, Philippine Statistics Authority (PSA) listed over 777,687 registered establishments which climbed 18.9% come 2017 with 924,721. Still eating the huge chunk of pie are the MSME's accounting for 99.56%. Out of the 3, Micro enterprises still has a bigger slice with 89.63%, shy of 1.67% from 2010's 91.63%. Small-sized enterprises have improved with 26,433 added over the past 7 years.[2]
2010
|
2017
|
2010
|
2017
| |
%
|
Number
| |||
Micro
|
91.3
|
89.63
|
709,899
|
828,436
|
Small
|
7.9
|
9.56
|
61,979
|
88,412
|
Medium
|
0.4
|
0.41
|
2,786
|
3,829
|
Large
|
0.4
|
0.44
|
3,023
|
4,044
|
TOTAL
|
100%
|
100%
|
777,687
|
924,721
|
RP Enterprises (2010): 777,687; MSMEs = 774,664
RP Enterprises (2017): 924,721; MSMEs = 920,677
Steady growth of MSMEs
From 2010 with 774,664 to 896,839 in 2015, then 911,768 in 2016, and finally 920,677 in 2017, there's an undeniable increase in trend happening over the years [3].
This may be due to the growing economy of the Philippines, the boost in social media, and changing interests of consumers. [4]
Enterprises in terms of Value Added
DTI's latest available data on the value added was way back in 2006 showing that large money are funneled down to the large enterprises while only around 30% was shared among MSME, despite the probability that it was from a huge number of business establishments which employed the majority of the filipinos.
Despite its number, the big corporations still monopolize a huge chunk of the market and have remained strong economic drivers in many industries.
With this in illumination, how then can MSMEs get more market share when it is up against huge corporations? What opportunities are there to tap?
1 - Ward, Susan. 2019. SME Definition. SME Definition Vary from Country to Country. The balance small business, accessed 26 September 2019,
<https://www.thebalancesmb.com/sme-small-to-medium-enterprise-definition-2947962>
2 - MSME Statistics 2017 , accessed 25 September 2019, <https://www.dti.gov.ph/business/msmes/msme-resources/msme-statistics>
3 - www.FOI.GOV.PH
4 - Moneymax. 2019. 15 Small Ideas in the Philippines you can start even with low capital, accessed 25 September 2019, <https://www.moneymax.ph/personal-finance/articles/small-business-ideas-philippines/>
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