Despite the presence of giant firms or enterprises, small businesses and

enterprises continue to exist and play a significant role in the economy

for several reasons. Here are some key points to consider when
discussing why small enterprises persist alongside large corporations:

1.Specialization and Niche Markets: Small enterprises often cater to

niche markets or specialized industries that may not be effectively
served by larger corporations. They can focus on specific products,
services, or customer segments that require personalized attention,
customization, or unique offerings.

2.Flexibility and Adaptability: Small businesses are known for their

agility, flexibility, and ability to respond quickly to market changes,
customer demands, or industry trends. They can adjust their strategies,
operations, and offerings more rapidly than large corporations, allowing
them to stay competitive in dynamic environments.

3.Local Presence and Community Engagement: Small enterprises often

have a strong local presence and community ties, which can foster
customer loyalty, trust, and support. They contribute to the local
economy, create jobs, and provide personalized services that resonate
with community needs and preferences.

4.Innovation and Entrepreneurship: Small businesses are often hubs of

innovation, creativity, and entrepreneurship, where new ideas,
products, or services are developed and introduced to the market. They
can experiment, take risks, and explore unconventional approaches
that may lead to breakthroughs and industry disruptions.

5.Cost-Effectiveness and Efficiency: Small enterprises can operate with

lower overhead costs, streamlined processes, and leaner structures
compared to large corporations. This cost-effectiveness allows them to
offer competitive pricing, maintain profitability, and survive in markets
where margins are tight.

6.Job Creation and Economic Diversity: Small businesses are significant

contributors to job creation, economic growth, and diversification,
particularly in sectors like retail,services,hospitality, and technology.
They provide employment opportunities, foster entrepreneurship, and
promote economic resilience by reducing dependence on a few
dominant players.

7.Customer Relationships: Small enterprises have the advantage of

building strong, personalized relationships with customers,
understanding their needs, and providing tailored solutions that may be
lacking in large corporations focused on mass production or scale.

8.Risk Management: Small businesses can diversify risk, explore niche

markets, and test new concepts or products on a smaller scale before
scaling up, allowing them to be more agile, resilient and adaptive to
changing market conditions.

9.Regulatory Compliance: Small enterprises may face less regulatory

burden or red tape compared to large corporations, enabling them to
operate more efficiently, navigate legal requirements, and maintain
compliance without the complexities associated with corporate
governance.Weak business climates and lack of enforcement of
regulations can encourage and allow large informal operators to
operate with near impunity. Governments should promote policies that
assist small informal firms to improve productivity and raise incomes
while enforcing fiscal and regulatory obligations for large informal
actors
10.Entrepreneurial Spirit: Small businesses embody the entrepreneurial
spirit, ambition, and vision of their founders, who often take personal
ownership, pride, and responsibility for their ventures, driving growth,
innovation, and long-term sustainability.

11.Different Operational Needs: Small and midsize enterprises operate

differently from large, multinational companies. They may require
fewer systems and narrower scope of operations, making them suitable
for certain industries and business models.

12.Classification Criteria: Enterprises can be classified based on the

number of employees, with small and medium-sized enterprises (SMEs)
employing fewer than 250 people. This classification acknowledges the
distinct role and presence of small enterprises in the business
landscape.

Overall, the coexistence of small enterprises alongside giant firms

reflects the diversity, dynamism, and resilience of the business
ecosystem. Small businesses bring unique strengths, advantages, and
contributions to the economy and society that complement the scale,
resources, and reach of larger corporations. By fostering innovation,
entrepreneurship, job creation, and community engagement, small
enterprises contribute to a vibrant and sustainable business landscape
that benefits both local communities and the broader economy. Their
ability to adapt, specialize, and connect with customers on a personal
level underscores the enduring appeal and value of small businesses in
a competitive and ever-changing market environment.
Reference:Jackson, L. M. (2019).American Psychological
Association.The psychology of prejudice>>From attitudes to social
action (2nd ed.)

:Ganster, D. C., Schaubroeck, J., Sime, W. E., & Mayes,B. T.

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