Comparison of small, medium, and large business types

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Comparison between different types of business

Business sizes

Businesses are usually divided into different classes depending on either the number of employees a business has or the total worth of its assets. Different businesses fall under the following category: Small, medium or large enterprise. These businesses have different number of employees, and this is what differentiates between the different types of business. Small businesses have around 5-50 employees, medium size businesses have about 50-250 employees and large business have about 250 employees or more.

Comparison between small businesses and big businesses

Unlike big businesses, small businesses can begin at a very low cost and also can start as a part-time job. Small businesses are usually in direct contact with the client. This gives small businesses some sort of intimacy and makes them have a greater accountability. This makes small businesses to be more flexible than big businesses in their operations. Small businesses have a lower economy of scale, for example, a large business can get better pricing on its products because they buy in bulk. This makes big businesses to be profitable Andrews & Rogelberg, 2001()

Small businesses tend to deal with scandals more easily as compared to big companies. Small businesses are also known to have a more personal and efficient customer service. This is, however, not always true. Small businesses are at a disadvantage when it comes to providing quality products as compared to large businesses. This is because large businesses often produce a large number of different products and small businesses are left to specialize in one product and this way they can compete with the large businesses Weaver, 2001()

Small business preference programs

These are programs that were established in 1953 by the government to assist small businesses. This was a way of strengthening the economy. The government wanted to encourage survival of the small businesses and encourage their growth. Small businesses are known to provide employment to many people so the government seeks to encourage them to bid and win procurement contracts. Small businesses should meet certain criteria so as to qualify for these preference programs. These preference programs that the small business should meet include the size standards of the business, the federal goals which give preference to small businesses, city, state and country, the certification procedure, as well as SBA & SBDC assistance. All these aim at encouraging small businesses to participate in trade and bidding for contracts. The government also sets standards for these businesses to make them accountable.

Preference program assist small businesses to be competitive and overcome common market adversities. However, there've been cases of fraud reported in regards to the program. The government has put in-place measures to curb this vice. Other preference programs include, HUB zone program, CCR also known as the Ultimate preference, Business development assistance, veteran assistance, and NAFTA and SBAO'Gorman, Bourke, & Murray, 2005()

Contract administration and management

Contract administration and management involves some activities carried out in a business aimed at determining whether the process of awarding a contract is fair. It also ensures that the contractor meets the requirement of the awarded contract. These activities are carried out from the time the contract is awarded till the work is completed. Contract administrators monitor and maintain the performance of contracts.

The need for contract management and administration

To ensure that goods and services are acquired on time

To ensure the contractors comply with the obligations

To assess the contractor's performance for the purpose of compliance and making future procurement decisions.