16.1 Introduction
Definition of a small business
What people mean by ‘small’ in the present context seems to vary widely: number of
employees, total funds invested, and sales turnover are often used in the definition.
For our present purposes, a strict definition probably does not matter. The sorts of
business that we shall mainly be discussing are those displaying the following features:Small businesses
In this chapter we shall deal with the following:
‘definitions of ‘small’ businesses
‘the importance of the small business sector of the economy
‘the objectives of small businesses
‘the likely legal form of the small business
‘taxation and the small business
‘investment appraisal in small businesses
‘risk and the discount rate to apply in appraising real investment
opportunities for the small business
‘problems experienced by the small business with raising external long-term
finance
‘valuing the shares of the small business
‘gearing in the small business
‘dividends and the small business
‘working capital and the small businessChapter 16
Objectives