A survey conducted by the PHD Chamber of Commerce and Industry revealed that many SMEs prefer to be classified based on their turnover instead of investments. The study was conducted on SMEs hailing from Uttar Pradesh, Punjab, Haryana, Madhya Pradesh, Himachal Pradesh and others.
Some people believe that the small businesses should be classified based on the investment. The classification was done based on the investment in fixed assets including plant and machinery. It was indicated that the size and capacity of a firm are decided based in the investment in more fixed assets.
However, the survey conducted in North India revealed that many small business firms prefer the classification based on their turnover. The study also achieved the same result from South India. The sales of an unit is reflected by the turnover of a firm. Sales are considered to be the real indicators of the size of small business enterprises and their ability. It was revealed from the study that about 68% of SMEs participated in the study expressed the support to be given by the government for expansion of business operations.