UK SMEs: Classification and Definition

Defining SMEs in the UK

• SMEs in the UK are classified as having fewer than 250 employees
• Small businesses have 10-49 employees, with a turnover of under £10 million
• Medium businesses have 50-249 employees, with a turnover of up to £50 million

Microbusinesses in the UK

• Microbusinesses have a turnover of £632,000 or less, £316,000 or less on their balance sheet, and 10 employees or less
• 96% of SMEs are classified as microbusinesses
• 18% of microbusinesses have a turnover of less than £50,000
• Over 23,500 microbusinesses have a turnover of more than £1 million
• The average turnover of microbusinesses in the UK is £286,879

Growth of SMEs and Microbusinesses

• SMEs account for 60% of total employment in the UK's private sector
• There are now two million more SMEs than in 2000
• 64% of the workforce wants to set up their own business, mainly for more money or to be their own boss
• Technological advancements have made it possible for people to start a microbusiness with just a laptop or smartphone

SMEs in Different Sectors

• There are almost 1 million SMEs in the construction sector
• Wholesale, retail, and manufacturing sectors each have a strong representation of SMEs (10% each)

Large Enterprises in the UK

• Large enterprises are classified as having 250 or more employees
• Only 7,700 businesses are classified as large enterprises, but they account for 40% of employment and more than half of turnover in the UK
• Over 25% of large enterprise owners are based overseas, primarily in the USA and Germany