SME-Small and Medium Enterprise Business in Malaysia

Small and medium business is the backbone of Malaysia. However, this comes with both strengths and barriers. One of the major barriers in this sector is funding. There are some of the advantages and disadvantages of SME in Malaysia. Let’s discuss some.

The small and medium businesses most of the time tend to feel intimidated by the big and gigantic companies who want to eat the entire cake in the business industry. Although the huge companies are one of the challenges faced, there are still some good about being in the SME sector.

Advantages of being SME

Close relationship with the customers

These businesses will deal so closely with the customers. The small ones deal directly with the customers. The advantage here is that the direct contact with the customer is one of the best way to identify the need of the customer. Once you identify these needs, you will do your best to give customer satisfaction and therefore keeping the customer for a long time.


The simple structure of the business is favorable to help in adjustments. When there are variations in the market, adapting to change is much easy for the small and medium business. This is a key

thing in maintaining the customers in the business. One of the examples is that they are able to increase stock when demand is high as well as reducing it when the demand is low.

Easy decision-making

All companies must make some decisions on the way forward. Decision-making is not an easy thing to do because it will determine the way forward of the company. This is in terms of making progress in profit and other major growths in the company. Looking at big companies, many people are involved in making decisions and this makes it hard to come to agreement. In small business, the process is easy because not so many people are involved in this process and this makes it easy to make progress.

Easy management and communication

Most SME are easy to manage because they do not involve a lot of employees. They do not involve so many branches and therefore getting to understand each and every member of the company is easy.

The staff members are also able to adhere to the rules and regulations of the company and it is easy to know the ones that are under performing. Communication between the workers of the business is also made easy as well as having a swift understanding among them.


Difficult to find funding

Small and medium companies lack the financial power that the big companies have. They will usually need external financing which may be more limited in worse conditions. To be able to overcome such a barrier, the business people in this sector need to familiarize themselves with the financial programs that help the small and medium business in Malaysia. There are several which will be helpful.

Hard to endure prolonged periods of crisis

It is easy for a small business to adjust to changes. However, when the crisis in the economy lasts for a long period of time, they tend to suffer. This is because the financing they have is somehow limited.

Every business whether small or big will experience both shortcomings and strengths. Knowing how to stand in time of shortcomings will keep a person standing and growing where they are. SME in Malaysia is good if you get to understand what to do to grow and what to do in times of crisis

Read more and similar: Residency in Malaysia – My Second Home Program in Malaysia

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