how is the size of a firm measured?
several methods can be used to measure the size of a firm, here are a few examples
several methods can be used to measure the size of a firm, here are a few examples
- turnover: firms with high turnovers will tend to be larger than those with small turnovers
- number of employees: firms with large numbers of employees tend to be larger than those with relatively few employed.
- the amount of capital employed: this measure is based on the amount of money invested in the business. Generally more money will be invested in larger firms.
- large amount of firms in UK are small and number has grown in last few decades.
- the growth in the tertiary sector has helped
- flexibility: small firms can adapt to change more quickly because owners are directly involved in the business and can react to change very quickly