New Definition for SMEs 

A new definition for SMEs will be effective on 1 January 2014 raising the qualifying threshold for sales turnover and employment of SMEs for all economic sectors. 

For the manufacturing sector, SMEs are defined as firms with sales turnover not exceeding RM50 million (currently: less than RM25 million) or employment not exceeding 200 workers (currently: less than 150 workers).  

For the services and other sectors, the threshold was also raised, as SMEs are firms with sales turnover not exceeding RM20 million (currently: less than RM5 million) or employment not exceeding 75 workers (currently: less than 50 workers).

Under the new definitions, micro enterprises are firms with annual sales of less than RM300,000 or fewer than five workers.

The new definiton is expected to result in more firms being classified as SMEs, to facilitate the country’s transformation to a high income nation through the initiatives under the SME Masterplan. As a result of the change in definition, the number of SMEs is expected to increase from 97.3% at present to 98.5%.

SMEs are defined as business entities registered under the Companies Commission of Malaysia (SSM) or equivalent. Subsidiaries owned by holding companies that are either public-listed or large are NOT considered as SMEs given the strong support from their parent company in terms of access to financing, technology, markets etc.  

 Manufacturing Sector

Existing  Definition

New Definition

 MICRO

Sales : less than RM250,000

OR

Employees : less than 5

Sales : less than RM300,000

OR

Employees : less than 5

SMALL

Sales :RM250,000 to RM10 mil OR

Employees : 5 to less than 50

Sales : RM300,000 to RM15 mil OR

Employees : 5 to less than 75

MEDIUM

Sales :   RM10 mil to RM25 mil

OR

Employees : 50 to 150

Sales :   RM15 mil to RM50 mil

OR

Employees : 75 to 200

 

 

 

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