Previously enterprise can be categorized based on the

Previously in Malaysia, there was no standard definition as to what Small and Medium Enterprises were. SME stands for Small to Medium Enterprise.

However, what exactly an SME or Small to Medium Enterprise depends on who is doing the defining. In Malaysia, the size of the enterprise can be categorized based on the annual sales, number of employees, assets, or any combination of these. Small to medium enterprises (SMEs) are the most majority of businesses in most countries. In order to successful in SMEs, SMEs business may have some challenges need to face and also have the solution to be solve.Definition of SMEsBased on the official website of SME CORP Malaysia, 98.

5% business establishments in Malaysia are SMEs. It can be said that SMEs are the backbone of Malaysia economy. Besides that, Malaysia SMEs can be group into three categories which are Micro, Small, and Medium. The majority of the SMEs are micro enterprises which make up 76.5 per cent of the total SMEs, followed by the small-scale enterprises, which comprise 21.2 per cent and Medium-sized enterprises are 2.3 per cent of the total SMEs.

In 2005, the National SME Development Council (NSDC) laid out two main criteria which are annual sales turnover and number of employees. These criteria apply to all SMEs of various sectors of agriculture, manufacturing and services. According to official SMEs website, SMEs are defined as firms with sales turnover not exceeding RM50 million OR number of full-time employees not exceeding 200 for the manufacturing sector. For the services and other sectors, SMEs are defined as firms with sales turnover not exceeding RM20 million OR number of full-time employees not exceeding 75.As the other parts of the world, SMEs in Malaysia operate various business.

There have three components that may be categorised in SMEs Malaysia which are agriculture sector, manufacturing sector and general business sector. Each of these sector and some example are be descried in detail below.A. Agriculture sectorThe agriculture sector includes perennial crops and cash crops. Perennial crops includes rubber, palm oil, paddy, and coconut while cash crops includes vegetables and fruits. B.

Manufacturing sectorThe main activities of manufacturing sector is physical or chemical transformation of materials or components into new products, such as food, beverage, petroleum, rubber, plastic, wood, chemical, electronic and electrical components. C. General Business sectorMeanwhile for the general business sector involved with wholesale and retail trade, construction, restaurant, transport and storage, hotel and business services and activity.


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