Entrepreneurs have a desire to be the master of themselves and have a high degree of commitment. Thus, instead of working for someone else, they choose to start up a small-business of their own. (Longnecker, Moore, Petty J. and Palich, 2005).
When it comes to small-business, there is no set definition since different experts tend to define a small business differently. There are many factors through which small businesses are defined, including factors like size of the company, revenue, profits, operations, etc. The Bolton committee for instance has devised a definition of a small business called the economic definition. The economic definition is a more qualitative definition that emphasizes that a firm is called small when it has a relatively smaller chunk of the total market share of the industry, it is managed by owners in an informal and highly personalized environment and does not have a formal structure and that it is not a part of any large concern or a corporation and operates independently. (Corman, and Lussier, 2008).
On the other hand, the European Commission defines a small business quantitatively. They coined a term Small & Medium Enterprise (SME) to refer to a small business. According to the European Commission, a business is a micro-enterprise if it has 0 to 9 employees, it is a small-enterprise if it has 10 to 99 employees and it is a medium-enterprise if it has 100 to 499 employees working under its umbrella. Organizations with employees 500 and above are hence called large-enterprises. Thus, a small business, in its true essence, is basically any firm that has a relatively smaller number of employed workers, has a small concern in the market, has a very informal organizational structure etc., however, at the end of the day, the exact measurement of any business as “small” is still a very vague concept and experts and analysts have thus been interpreting it differently according to the given situation and the circumstances.