Relationship between Micro and Macro Enterprises (5 Important Points)



The relationship between the micro and macro enterprises can be seen in various respects. Yet, the following are the important ones:

1. Competitive:

Micro enterprises cannot compete with macro enterprises in certain circumstances and in selected products. Examples of such enterprises/ industries are bricks and tiles, fresh baked goods and perishable edibles, preserved fruits, goods requiring small engineering skill, items demanding craftsmanship and artistry.

2. Supplementary:

Micro enterprise can fill in the gaps between large scale production and standard outputs caused by macro enterprises. This is due to this supplementary role of micro enterprises, a small tricycle factory sustained and flourished alongside a large cycle factory in Chennai city.

3. Complementary:

Apart from supplementary relationship, micro enterprises have been a complementary to their macro counterparts. In the real world, many micro enterprises produce intermediate products for macro units. Such sub­contracting relationship between the micro and macro was particularly marked in the economic history of today's industrially developed Japan.

As industrialisation proceeds, micro and small-size firms seem naturally to shift from activities that compete with macro and large firms to complementary ones. Similarly, China too continues to rely on Mao's aphorism of "walking on two legs"-one being micro and the other macro.

Under complementary relationship, micro units function under the tutelage of the macro units and enjoy the advantage of protected market for their products. Then, the flourishment of such micro units remains beyond doubt.

4. Initiative:

Attracted by the high profits of macro units, micro units can also take initiative to produce the particular product. If succeeds, the micro unit grows to macro over a period of time. Evidences are available to quote that many of the automobile factories started this way in the United States of America. In our country too, the electronic industry looks like following to this initiative pattern of development.

5. Servicing:

Micro enterprises do also install servicing and repairing shops for the products of macro units. In the case of India, such micro servicing units can be seen proliferating in respect of macro industries like refrigerators, radio and television sets, watches and clocks, cycles and motor vehicles.