MSME and Business Entrepreneurship

How micro, small and medium enterprises are classified, their role and problems, what entrepreneurship is, and the kinds of intellectual property.

Key ideas

• MSMEs are classified on two tests together: investment in plant and machinery or equipment, and annual turnover.
• They employ many people with little capital, help rural and backward areas grow, use local resources and skills, and add to production and exports.
• Their common problems are shortage of finance and raw materials, weak managerial skill and marketing, poor quality, low use of capacity, outdated technology and global competition.
• An entrepreneur starts a business, combines resources and bears its risks; entrepreneurship is systematic, lawful, purposeful, innovative and risk taking.
• Intellectual property is creations of the mind; the law protects it so that creators can earn from their ideas and others cannot copy them freely.
• The kinds recognised in India are copyright, trademark, geographical indication, patent, design, plant variety and semiconductor layout design.

Remember

Watch out

• Classifying by investment alone: a unit must be within both the investment and the turnover limit.
• Mixing up patent and copyright: inventions are patented, books and songs are copyrighted.
• Calling a logo a patent: a name or symbol is a trademark.

Worked example