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SME segmentation


Written by Christian Saublens

 

The concept

How to implement it?

Step in the RIS process

What can be expected?

A quote

References

 

The concept


Classify the SME population of a region (up to 400 000 in Andalucia, Provence-Alpes-Côte d’Azur or Scotland) in a way that those which show growth potential are best identified. This is a recognition that SMEs are not a monolithic concept. The segmentation of the regional SME population allows to shift the traditional view of picking winners into a more efficient/public support system of supporting winners.

 

How to implement it?


To assess the growth potential of all the regional enterprises through a few indicators such as:

  • Number of staff
  • Export track record
  • Past experience in innovation
  • Fast increase in turnover
  • Novelty of their product/service range
  • Innovation capability
  • Capacity to put new products/services in the market

The graph below illustrates such segmentation on the basis of the experience developed by Scottish Enterprise.

 

This segmentation helps to understand the different expectations of a diverse portfolio of enterprises composed for instance of the following categories:

  • Entrepreneurs by necessity
  • Lifestyle entrepreneurs
  • Newly-developed companies
  • Spin-outs and spin-offs of large businesses, research centres and universities
  • Start-ups (less than five years in existence)
  • Locally-rooted companies (micro-businesses and craft companies)
  • Entrepreneurial growth companies (gazelles)
  • Globally born companies
  • Innovative businesses and companies leveraging RTD outcomes (spin out/spin off)
  • Companies in the process of being transferred
  • Subcontractors
  • Phoenix enterprises
  • Hidden champions
  • Multinationals
  • Social enterprises
  • Companies at risk of bankruptcy

 

Step in the RIS process


  • Step 1: Analysis of the regional context
  • Step 5: Definition of coherent policy mix, roadmaps and action plan

 

What can be expected?


An effectiveness of the enterprise support services. Too often support service schemes don’t really match the real needs of enterprises having a real growth potential. Therefore, some schemes are too basic as they have to reach out to all regional enterprises and therefore enterprises benefiting from the schemes are not necessary able to maximize their benefits. There is also often a deadweight effect.

A dialogue with enterprises’ representing the different components of the segmentation also allow to understand and design support services with a higher added value aiming at matching the needs of the different types of enterprises.

 

A quote


“To deliver better support services we’ve developed an account management approach.” by Linda Hanna, Scottish Enterprise

 

References


  • Regional policy for smart growth of SMEs (August 2013, DG Regional and Urban Policy)

 

Mr Christian Saublens


 

Christian Saublens has more than 30 years of working experience in European trade organizations. Since 1992 he is the Executive Manager of EURADA, the European Association of Development Agencies, a network of 145 organisations. Christian has been involved in the organization of numerous conferences and meetings dealing with all matters related to regional development. He wrote several papers and working documents on business support schemes for SMEs. He played an important role for the dissemination in European regions of concepts such as benchmarking, business angels, investment readiness, proof of concept, clusters, open innovation, financial engineering, crowdfunding, … Several times Christian has been appointed as an expert by the European Commission and the Committee of the Regions.

christian.saublens@eurada.org

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