Small And Midsize Enterprises - SME

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DEFINITION of 'Small And Midsize Enterprises - SME'

A business that maintains revenues or a number of employees below a certain standard. Every country has its own definition of what is considered a small and medium-sized enterprise. In the United States, there is no distinct way to identify SME; it typically it depends on the industry in which the company competes.

In the European Union, a small-sized enterprise is a company with fewer than 50 employees, while a medium-sized enterprise is one with fewer than 250 employees.

INVESTOPEDIA EXPLAINS 'Small And Midsize Enterprises - SME'

SME firms tend to spend a lot of money on IT and, as a result, these businesses are strongest in the area of innovation. The need to attract capital to fund projects is therefore essential for small and medium-sized enterprises. To be competitive SME firms require "out of the box" solutions, even if they involve surrendering some functionality.

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