Small businesses can be categorized into four types based on their characteristics, operations, and growth stages:
1. Micro Enterprises
1. Definition: Small businesses with fewer than 10 employees and annual turnover less than PKR 10 million (approximately USD 62,500).
2. Features: Home-based, informal, and often family-owned.
3. Examples: Freelancers, consultants, small retailers, or service providers.
2. Small Enterprises
1. Definition: Small businesses with 10-50 employees and annual turnover less than PKR 50 million (approximately USD 312,500).
2. Features: Formal structure, registered with authorities, and may have some employees.
3. Examples: Small manufacturing units, service providers, or retailers.
3. Medium Enterprises
1. Definition: Small businesses with 50-100 employees and annual turnover less than PKR 100 million (approximately USD 625,000).
2. Features: Established brand, formal structure, and may have multiple locations.
3. Examples: Medium-sized manufacturing units, service providers, or retailers.
4. Small and Medium Enterprises (SMEs)
1. Definition: Small businesses with fewer than 250 employees and annual turnover less than PKR 500 million (approximately USD 3.125 million).
2. Features: Diverse range of industries, formal structure, and may have international operations.
3. Examples: SMEs in various sectors, such as technology, healthcare, or finance.
These categories help governments, policymakers, and financial institutions provide targeted support, incentives, and resources to small businesses.
