SME stands for Small and Medium Entreprises. In the UK, this means a company with less than 250 employees. The EU distinguishes between micro, small and medium companies according to their headcount and a measure of their economical weight. Often (but not systematically) the size and commercial reach of a business converge.
Focusing on the headcount and turnover*, the official EU definition is as follows:
- micro: less than 10 employees and ≤ 2M euros turnover
- small: less than 50 employees and ≤ 10M euros turnover
- medium: less than 250 employees and ≤ 50M euros turnover
On this site, I will keep my focus on a company’s headcount. For the readers interested in working in an SME, this will usually be the most relevant parameter to introduce a business. Questions about their financial health are better addressed in face to face conversations.
Now that SMEs are defined, let us examine why we should bother with them at all.
* The turnover is the amount of business that a company does in a period of time, usually one financial year. The other EU scale measure is the balance sheet, which is a financial statement that provides a snapshot of the situation of a company at a given date.