Small and medium-sized businesses, or SMEs, as they are commonly known, have long been recognized as the main forces behind economic expansion and progress. The rationale is that they ensure the flow of money between various social strata while also offering a wide variety of employment options. Since 2020, there has been a rise in small businesses. People have ventured into different sectors in the business world, from fashion to hospitality. This has had an impact on the Kenyan economy.
A 2015 estimate said approximately 600 million jobs would be needed globally over the next 15 years. The majority of formal employment opportunities in developing markets are often produced by SMEs. That amounts to nearly four out of every five jobs on the market. Despite being crucial to the growth of the economy, it has been shown that almost 50% of SMEs lack access to capital investment or financing. Around 33% of the national GDP and 45% of all jobs in developing nations are currently produced by formal SMEs.
SMEs fuel economic growth: They generate numerous new job possibilities, propel the innovation wave, and broaden the tax base. SMEs are increasing rapidly every day, with great profit.
SMEs Increase Competition: SMEs are inter-greeted in different sectors. which leads to competition. The best qualities of a business are brought out by this constant struggle for supremacy. As a result, both the service provider and the customer benefit. Additionally, this improves economy-wide efficiency and total production.
SMEs bring forth innovations, ideas, and skills: With globalization and a market that is evolving quickly, more enterprises are competing than ever. You can anticipate the market and stay current with customer desires by using innovative thinking. If your company doesn’t innovate, you’ll have to work hard to keep up as innovative businesses introduce new concepts to the market.SMEs come up with innovations to keep up with the competition.
SMEs Adapt Fast: SMEs quickly adapt to the fast-paced business environment by embracing e-commerce and online purchases of goods and services. The development of technology has not only made purchasing and selling easier, but it has also assisted business owners in lowering their spending on marketing and promotion. For SMEs, using several e-commerce platforms makes life simple.
Everyone is acquainted: It is simpler to build relationships and get to know people in a small or medium-sized business. This can be utilized to boost productivity and strengthen collaboration. Additionally, it will be much simpler to divide up the jobs in some circumstances such as problem-solving and generating marketing and branding ideas.
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