Small and medium sized businesses are often referred by the acronym SMB. Another acronym used to refer to the small and medium sized businesses is SME, used for small and medium sized enterprises. If one has to define a small or medium sized business, one has to take into account the number of employees in the organization. If the number of employees in an organization is below a certain number, then that organization would be considered a small or medium sized business. If seen globally, the number of small and medium sized businesses is far more than the number of large organizations. These small and medium sized companies are a breeding ground for new and innovative ideas. As they are present in larger numbers, the spirit of competition among them is far more than among large enterprises.
Apart from the headcount of the workforce in these enterprises, other defining factors would be the revenue generated by them and the asset owned by them. The factors or parameters defining a small and medium sized company is different in different countries.
SMBs are crucial for those countries whose economies are still emerging and developing. They form the base of employment in these countries, however, their major drawback is that they often lack the capital that is needed to sustain them during a lean period. They primarily depend on personal funds and loans from family and friends.
SMEs cannot afford to keep many employees. They need software and applications that can help them automate certain processes. This is when the heads of the business sit together to discuss which software they should buy to decrease their expenses. This is when they opt for enterprise resource planning (ERP) software. SAP has been well known for making ERP software. The SMEs often opt for SAP accounting software to better their accounting process.
SAP accounting software manages every aspect of the accounting department:
* Data regarding all the transactions are recorded on a real time basis.
* This data is then segregated in useful categories that can be analyzed.
* Proper analysis of the data is done to draw pertinent conclusions.
These are the basic functionalities of the accounting software that they perform in a real time basis and usually in a single platform. These accounting software is very helpful for small and medium sized enterprises.