Page 45 - Business_Studies_F5

Student's Book Form Five

Chapter Three

Financing medium-sized businesses
FOR ONLINE READING ONLY

Introduction

Normally, businesses are established and operated by individuals or groups
of individuals with the main objective of generating profits. In particular, one
of the factors to be considered before establishing a business is the way it
can be financed. In this chapter, you will learn about the concept of medium-
sized businesses, and sources of financing for the medium-sized businesses.
The competences developed will enable you to acquire financial support from
different sources to establish and run the medium-sized businesses.

Think
Operating business without any financial support.

The concept of medium-sized businesses

Universally, there is no single accepted definition of medium-sized businesses. However,
nations use different measures of size to define medium-sized businesses depending
on their level of development. The Tanzania Small and Medium Enterprise (SME)
Development Policy of 2003 recognises four categories of businesses namely; micro,
small, medium, and large-scale enterprises. Medium-sized businesses are based on the
following features:
Number of employees: Medium-sized businesses employ 50 to 99 people who are
engaged in various business activities like production and marketing of products as
well as business support services such as accounting and human resources management.

Capital invested: Medium-sized businesses invest capital which range from TShs. 200
million to TShs. 800 million.

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