SME sector – definition and criteria
All European Union member states use identical criteria when it comes to assigning companies to the SME sector.
The first characteristic that a company must meet is the number of employees:
- Microenterprises can employ a maximum of 9 employees;
- In small companies, up to 49 people can work;
- In medium-sized enterprises, the number of employees must not exceed 249. A company with 250 employees will already be counted as a large enterprise.
Important!
The number of people employed does not include those working at the company for the purpose of professional preparation (apprentices and trainees), those on paternity and parental leave, and those on maternity leave.
If the number of employees matches, it is necessary to check the second, financial criterion – annual turnover or total annual balance sheet. However, it should be borne in mind that the entrepreneur is required to choose only one of the two elements (turnover or balance sheet) and apply it consistently in determining the company’s status:
- The annual turnover or total annual balance sheet of microenterprises must not exceed €2 million;
- Small businesses can achieve an annual turnover or balance sheet of no more than €10 million;
- The annual turnover of medium-sized companies must not exceed €50 million, while their total annual balance sheet must close at €43 million.
Important!
In order for a company to enjoy SME status, it must meet the criteria of number of employees and turnover or balance sheet for at least two fiscal years.
Characteristics of the SME sector in Poland
Poland’s SME sector is vast, according to the most up-to-date data compiled in the publication Report on the state of the small and medium-sized enterprise sector in Poland, issued by the Polish Agency for Enterprise Development (PARP), the number of micro, small and medium-sized companies in Poland is 2.15 million, an increase of 3.5% year-on-year (2018 data).
Important!
The source data from the PARP 2020 report is from 2015-2019 and does not yet include the impact of the coronavirus pandemic on Poland’s SME sector.
Important figures
The condition of the SME sector in Poland is best illustrated by statistical data – detailed numbers with a discussion can be found in the mentioned Report , here we will cite only a few of the most relevant:
- Of the more than two million non-financial enterprises registered in Poland, only 3,700. are large companies – the remainder belong to the SME sector (15.2 thousand medium-sized, 52.7 thousand small and 2.08 million micro enterprises);
- The number of companies in Poland grew steadily from 2009 to 2018 (there was a large decline between 2008 and 2009, and a slightly smaller one in 2019. Another projected decline is in 2020, for obvious reasons);
- SME companies mainly operate in services (52.1%), trade (23.6%), construction (14.1%) and industry (10.3%). In comparison: more than half of large companies are industrial (52%);
- Of the 283,914 companies established in 2018. Only 191,818 will survive until 2019. – This gives a first-year business survival rate of 67.6%. However, it is worth remembering that the first year is usually the most difficult – the rate is higher in the subsequent years of the companies’ existence;
- All companies in Poland produce approx. 72% of the Gross Domestic Product. It is worth knowing that SME companies are responsible for almost half of PBK (49.1%), and microenterprises alone generate more than 30% of GDP.
Support for companies in the SME sector
SME status allows to apply for various forms of public assistance provided for this sector. We are talking about various types of grants and subsidies (for example, from the European Funds), competitions (often organized by regional entrepreneurship centers) or, especially important in recent months, forms of assistance provided under successive versions of the government’s Anti-Crisis Shield.
Where to look for support?
Getting help for micro, small and medium-sized companies involves searching for suitable projects. With difficult access to government offices and business incubators, the search has moved almost 100 percent to the Internet. Here are some places where entrepreneurs can find the information they need:
- gov.pl – Anti-Crisis Shield – updates on planned and implemented solutions for entrepreneurs to combat the economic effects of the coronavirus pandemic;
- State Agency for Enterprise Development – information on training, grants, European Funds and other forms of funding;
- European Funds Portal – interested entrepreneurs will find here information on available forms of financing. Grants for SME companies are collected at this link.
