6 Criteria of Small and Medium Enterprises (SMEs) in Malaysia

Summary

This video provides an informative overview of small and medium enterprises (SMEs) in Malaysia, outlining their definitions, classifications, and criteria for qualification. It explains the distinctions between micro, small, and medium enterprises, detailing their sales turnover and employee thresholds. The video also discusses the various sectors SMEs operate in, the qualifying criteria, and additional conditions for classification. Finally, it highlights the advantages SMEs enjoy, including financial and non-financial incentives provided by government agencies, emphasizing their crucial role in Malaysia's economic growth and transformation.

Takeaways

• 😀 SMEs in Malaysia are defined by two categories: Manufacturing and Services/Other Sectors.
• 📊 A business qualifies as an SME if it meets specific sales turnover or employee criteria, with limits set for both categories.
• 🔍 Micro Enterprises have a sales turnover of less than 300,000 ringgit and fewer than 5 full-time employees.
• 📈 Small Enterprises in manufacturing have sales turnovers between 300,000 and 15 million ringgit, while those in services range from 300,000 to 3 million ringgit.
• 🏭 Medium Enterprises in manufacturing must have sales turnovers between 15 million and 50 million ringgit or 75 to fewer than 200 employees.
• 💼 The classification of sectors includes Manufacturing, Services, and Other activities like Agriculture and Construction.
• 📋 Qualifying criteria for SMEs include total revenue and full-time employee counts, with specific definitions of what constitutes full-time employment.
• 🚫 A business cannot be classified as an SME if it exceeds the defined thresholds for two consecutive years.
• 🔗 To be classified as an SME, businesses must be registered entities and not public listed companies or subsidiaries of such entities.
• 🏆 SMEs benefit from various financial and non-financial incentives from government agencies to enhance their competitiveness and growth.

Q & A

What are the two main categories of SMEs in Malaysia?

The two main categories of SMEs in Malaysia are manufacturing and services.

What is the sales turnover limit for manufacturing SMEs in Malaysia?

For manufacturing SMEs, the sales turnover must not exceed 50 million ringgit.

How is a micro enterprise defined in terms of sales turnover and employees?

A micro enterprise is defined as having a sales turnover of less than 300,000 ringgit and fewer than 5 full-time employees.

What is the maximum sales turnover for small enterprises in the services sector?

The maximum sales turnover for small enterprises in the services sector is less than 3 million ringgit.

What additional conditions must businesses meet to be classified as SMEs?

Businesses must be registered with the relevant authorities and cannot be public listed companies or subsidiaries of public companies on the main board.

What happens to a business that exceeds the SME criteria for two consecutive years?

If a business exceeds the SME criteria for two consecutive years, it can no longer be classified as an SME.

What role do SMEs play in Malaysia's economy?

SMEs play a vital role in fostering growth, employment, and income, contributing significantly to Malaysia's economic transformation.

What types of financial incentives are available to SMEs in Malaysia?

Financial incentives for SMEs include grants, conventional loans, venture capital funding, and tax incentives.

Which agencies provide support and incentives to SMEs in Malaysia?

Key agencies providing support and incentives to SMEs include the Small and Medium Industries Development Corporation (SMIDEC), the Malaysian Industrial Development Authority (MIDA), and the Technology Development Corporation (MTDC).

What constitutes the classification of sectors for SMEs?

SMEs are classified into manufacturing, services, and other sectors, which include primary agriculture, construction, and mining.