What is the Relationship between Small and Large Scale Entrepreneurs?

The small scale industries can have the following types of relationship with large industries:

(1) Competitive:

Small scale industry can out compete with large industry in certain circumstances and in selected products only.

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(2) Supplementary:

Small industry can fill in gaps between large scale production and standard output caused by large scale units. This is due to this supplementary role of small units.

(3) Complementary:


Small industry has been a complementary to its large counterparts. In the real world many small units produce intermediate products for large units.

(4) Initiative:

Small units can also take initiative to produce the particular product attracted by the high profits of large units.

(5) Servicing:

Small industries do also install servicing and repairing shops for the products of large units. Many small firms have been assigned the job of repair and maintenance of products manufactured by large units.

(6) Jobbing:

In some cases, large enterprises provide materials and components to small units. The small units process these materials and components into finished parts or sub-assemblies.

(7) Merchandising:


Some small scale industries distribute and sell their products through large scale units.

(8) Anciliarisation:

Many large scale firms purchase components, parts and accessories from small scale industries.

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