In the United Kingdom SME's or Small Medium Enterprises are generally comprised of fewer than 250 employees with an annual turnover of less than 50million Euros (roughly £34.5 million). Most UK businesses begin as a micro firm (less than 10 employees) working from home. As the company expands it will often move to serviced or managed office space. Once it reaches the size at which it can be classed a small business (fewer than 50 employees) firms tend to take on permanent or multi-year office leases.
The Small Business Act states that a small business concern is "one that is independently owned and operated and which is not dominant in its field of operation." The law also states that in determining what constitutes a small business, the definition will vary from industry to industry to reflect industry differences accurately. SBA's Small Business Size Regulations implement the Small Business Act's mandate to SBA. SBA has also established a table of size standards, matched to North American Industry Classification System (NAICS) industries.
When the U.S. Congress first established SBA, the fundamental question was just what numerical definition should SBA use to define small businesses, industry by industry, to determine what businesses were eligible for SBA's programs. Over the years SBA has established and revised numerical definitions for all for-profit industries, and this numerical definition is called a "size standard."
It is almost always stated either as the number of employees or average annual receipts of a business concern. In addition to establishing eligibility for SBA programs, all federal agencies must use SBA's size standards for its Federal Government contracts it identifies as a small business. Agencies must also use SBA's size standards for their other programs and regulations, unless they are authorized by Federal statute to use something else.