INDUSTRY DEVELOPMENTS AND MODELS Western European …img0.liveinternet.ru/images/attach/b/2/3612/... · Laura Converso IDC OPINION SMBs are the backbone of the Western European economy

Filing Information: May 2006, IDC #MM01N, Volume: 1 European Small and Medium Business Markets: Industry Developments and Models

I N D U S T R Y D E V E L O P M E N T S AN D M O D E L S

W e s t e r n E u r o p e a n S M B M a r k e t : S t r u c t u r e a n d P e r f o r m a n c e I n d i c a t o r s 2 0 0 5

Laura Converso

I D C O P I N I O N

SMBs are the backbone of the Western European economy with almost 11 million enterprises. The vast majority of the enterprise population (99.8%) are SMBs with fewer than 500 employees. The distribution of employment in Europe is also skewed toward small to medium-sized enterprises, which employ 70% of the total workforce.

By studying business demographic data, we can identify the differences and similarities across the 16 Western European countries and 21 sub-vertical markets analyzed in the study.

Key findings include:

! With more than 2 million companies, Germany has the highest number of companies in Western Europe, as well as a huge workforce of almost 27 million.

! The activities with the highest number of enterprises in Western Europe are raw materials, agriculture, and mining; building/construction; retail/wholesale; and business services, accounting for 70% of the total universe of enterprises. The majority of them belong to the smallest segment.

! SMBs, or companies with fewer than 500 employees, employ almost 70% of the total workforce, while large and very large companies employ the remaining 30%.

! According to IDC's analysis, the average Western European company employs 12 people. At a country level, Greece has a micro-enterprise environment with an average of four people employed, while U.K. and Dutch firms have the highest number of employees, at 21 per company.

! The top 5 countries in the region � Italy, Germany, France, Spain, and the U.K. � have 71% of the total enterprise population and account for 74% of the total workforce.

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T A B L E O F C O N T E N T S

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In This Study 1 Methodology ............................................................................................................................................. 1 Situat ion Overview 8 Number of Enterprises.............................................................................................................................. 8 Future Outlook 17 Short-Term Prospects for European Employment .................................................................................... 17 Short-Term Prospects for the European Business Demography .............................................................. 17 Essential Guidance 18 Appendix................................................................................................................................................... 18 Learn More 35 Related Research..................................................................................................................................... 35

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L I S T O F T A B L E S

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1 European Vertical Market Coverage According to NACE Rev.1: Group-Level Classification ..... 6

2 Western Europe, Total Number of Enterprises by Employee Size, 2005 ..................................... 8

3 Western Europe, Percentage Distribution of Enterprises by Country and Employee Size, 2005 ............................................................................................................................................. 9

4 Western Europe, Employment Indicators by Country, 2005......................................................... 10

5 Western Europe, Distribution of Employment by Size, 2005........................................................ 11

6 Western Europe, Percentage Distribution of Employment by Size, 2005..................................... 11

7 Western Europe, Average Employment by Company Size, 2005 ............................................... 12

8 Western Europe, Number of Enterprises by Employee Size, 2005.............................................. 13

9 Western Europe, Number of Enterprises in Retail and Wholesale by Employee Size, 2005 ....... 14

10 Western Europe, Number of Enterprises in Finance by Employee Size, 2005 ............................ 14

11 Western Europe, Number of Enterprises in Transport, Communications and Utilities by Employee Size, 2005 ................................................................................................................... 15

12 Western Europe, Number of Enterprises in Business Services by Employee Size, 2005 ............ 15

13 Western Europe, Number of Enterprises in Government, Healthcare, and Education by Employee Size, 2005 ................................................................................................................... 16

14 Western Europe, Number of Enterprises in Manufacturing by Employee Size, 2005................... 16

15 Austria, Number of Enterprises by Employee Size, 2005............................................................. 19

16 Belgium, Number of Enterprises by Employee Size, 2005........................................................... 20

17 Denmark, Number of Enterprises by Employee Size, 2005 ......................................................... 21

18 Finland, Number of Enterprises by Employee Size, 2005 ............................................................ 22

19 France, Number of Enterprises by Employee Size, 2005............................................................. 23

20 Germany, Number of Enterprises by Employee Size, 2005 ......................................................... 24

21 Greece, Number of Enterprises by Employee Size, 2005 ............................................................ 25

22 Ireland, Number of Enterprises by Employee Size, 2005............................................................. 26

23 Italy, Number of Enterprises by Employee Size, 2005 ................................................................. 27

24 Netherlands, Number of Enterprises by Employee Size, 2005..................................................... 28

25 Norway, Number of Enterprises by Employee Size, 2005............................................................ 29

26 Portugal, Number of Enterprises by Employee Size, 2005 .......................................................... 30

27 Spain, Number of Enterprises by Employee Size, 2005............................................................... 31

28 Sweden, Number of Enterprises by Employee Size, 2005........................................................... 32

29 Switzerland, Number of Enterprises by Employee Size, 2005 ..................................................... 33

30 U.K., Number of Enterprises by Employee Size, 2005................................................................. 34

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I N T H I S S T U D Y

This study provides an outlook on the SMB market structure and size across Western Europe. The main points analyzed include SMB number of enterprises and performance measured by employment.

In particular, this study presents:

! Total number of enterprises and employment in Western Europe.

! Distribution of number of enterprises and total employment by country and employee size class.

! Number of enterprises in the top 5 countries (France, Germany, Italy, Spain, and the U.K.) by economic sector and size class.

! Number of enterprises in Western Europe by country, vertical market, and size class.

M e t h o d o l o g y

All data provided in this study is the result of detailed research and comparison of data across multiple sources such as national statistic offices, Eurostat, OECD, and Dun & Bradstreet.

Data sources on Western European countries are sometimes incomplete and in many cases, even when information is available, it is not always easily comparable. For those countries where data is incomplete or not published, the estimated figures are based on Eurostat data (excluding self-employment and adding public sector) or on national SMB trade associations. With reference to employment, Eurostat Data Explorer database provides updated data on:

! Total employment

! Employment by vertical market (NACE Rev.1)

! Employment by size of enterprise

To provide a comprehensive and consistent picture of enterprise presence and employment, IDC applied the same criteria across the 16 Western European countries by providing:

! Consistent breakdown of enterprise data into comparable segments by employee size.

! Consistent breakdown of enterprise data into IDC vertical industry categories.

! The alignment of data to the most up-to-date time reference.

To estimate the number of enterprises across Western European countries, IDC adopted the following criteria:

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Breakdown of Enterprise Data Into Comparable Segments by Employee Size

When data disaggregation by size class did not correspond with IDC targeted classification or provided a low level of detail, IDC followed either one or the best combination of the following approaches to provide a consistent breakdown:

! Grouping of more detailed sub-classes into the targeted segment class (e.g., 10�49 employees and 50�99 employees were summed up into one 10�99 employee size class).

! An estimate of breakout based on average (or the most recurrent proportions) observed in previous years or in comparable countries for that specific vertical and size class.

! Exclusion of sole proprietorships (businesses that legally have no separate existence from their owners) and of self-employment (businesses without staff in paid employment) from the fewer-than-10-employee size class. When national statistics did not provide this level of disaggregation, the estimate was based on the "Features of Micro and Small Enterprises in the EU" report published by the European Foundation for the Improvement of Living and Working Conditions.

! For the larger employee size classes (500+ employees), IDC compared statistical sources from several company databases such as Dun & Bradstreet and Amadeus.

Breakdown of Enterprise Data Into IDC Vertical Industry Categories

When available data did not match with the targeted vertical industry detail, IDC followed either one or the best combination of the following approaches to provide a consistent breakdown:

! The grouping of more detailed sub-vertical markets into the targeted vertical markets (e.g., agriculture, mining, and quarrying verticals where summed up into a single raw material, agriculture, and mining category).

! An estimate of breakout based on average (or the most recurrent proportions) observed in previous years or in comparable countries for that specific vertical and size class.

! For the larger employee size classes (500+ employees), IDC compared statistical sources with detail from several company databases such as Dun & Bradstreet and Amadeus.

National statistic offices usually provide data on enterprise demography classified by industry (according to NACE Rev. 1) and size classes. However, in many cases, this data excludes verticals such as agriculture, government, healthcare, and education. In particular, health and education organizations are sometimes considered in a different set of data, as they are usually defined as "institutions" rather than as "enterprises."

! Agriculture: Agriculture censuses at a national level usually provide data on the number of holdings. From raw data, IDC estimated the number of farms excluding self-employment or family employment, by considering only the holdings with more than 20 hectares.

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! Local and central government: Data on government statistics are not easily comparable. For this reason, when the national statistic office did not provide this information, IDC estimated local government data as the sum of local entities with autonomous IT budget (provinces/states, district/cities, and municipalities) and central government data based on the number of government ministries and federal offices.

! Healthcare: When data was not provided by national statistic databases, IDC estimated healthcare data using multiple sources and summing up the number of private and public hospitals, care centers, and general practitioners in each country, excluding self-employment.

! Education: When data was not provided by national statistic databases, IDC estimated education data using multiple sources and summing up the number of pre-schools, primary, and secondary schools located in different buildings as well as higher education institutions such as universities and others.

National statistics registers usually provide figures on enterprise demography according to NACE REV.1 classification, and up to a two-digit level. However, to match some of IDC's vertical market categories, sometimes it is necessary to use a three-digit level disaggregation. For instance, this can be observed in the case of the communications and broadcasting category.

! Communications and broadcasting: In cases where national statistics do not provide NACE REV.1 classification at a three-digit level, IDC estimated the data using additional sources such as Eurostat and national telecommunications statistics.

Align Data to the Most Up-to-Date Time Reference

Data is captured from national statistics associations' most up-to-date publications and updates on enterprises' censuses results as well as from Eurostat's latest publications.

Employment

IDC data on employment in Western Europe by country, vertical market, and size class has been obtained from Eurostat's most up-to-date data. For distribution by vertical and employee size class, IDC referred mainly to Eurostat's Data Explorer database and to official documents of the national statistics offices.

Employment Definition

In this study IDC provides all data on employment referred to as the workforce in employment. This is different from the "labor force" or "active population," which represents the sum of employed and unemployed people. Unemployed people are those persons aged 15 and over who are:

! Without work

! Available to start work within the next two weeks

! Have actively sought employment at some time during the previous four weeks

! Have found a job to start at a later date

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Data provided in this study is mainly obtained through Eurostat's Data Explorer database.

The Enterprise Unit as IDC's Economic Entity

For IDC's Vertical Research purposes, an "economic entity" refers to a legal or social entity, or a group of entities, that engage(s) in economic activities and transactions (such as the purchase of IT goods and services) in its/their own right. The requirements of an enterprise are that it has one ownership or control. It can be heterogeneous with regard to its economic activity as well as to its location. It has legal, administrative, or fiduciary arrangements, organizational structures, or other parties having the capacity to efficiently allocate resources in order to achieve objectives. Examples include corporations, non-profit institutions, or government units.

When the enterprise is a single location organization the concept of enterprise and local unit/establishment coincide.

For IDC's vertical research statistics the most referred economic entity is the "enterprise/organization," ultimately referring to an economic entity with:

! A common IS strategy.

! An associated decision process and implementation.

! A common IS budget.

! A common production process.

! A common financial process.

IDC's Company Size Segmentation

Because IT adoption strategies are very much related to the complexity and type of organization structures, company size segmentation adds a valuable complementary view to vertical market analysis.

Although market segmentation by size of company seems straightforward, some factors need to be considered:

! The definition of size bands (options include number of employees or white collar employees, revenue size, number of PCs installed, IT spending level).

! Whether the organization being sized is the company or the establishment.

! Whether it includes only those entities within a specific country or those in other countries as well.

The selection of the type of organization and location is limited by the data available for a particular analysis. Where a choice is possible, the decision depends on the use of the information.

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The number of employees working for an organization typically determines company size. This type of segmentation is usually available and relates to market potential for many IT products and services. Two limitations of this approach are that:

! Size is relative: Organizations in different industries with the same number of employees can vary greatly in size. A wholesale company with 90 employees is considered to be quite large while a manufacturing company with fewer than 100 employees is thought of as small.

! Based on the way in which employees use IT, organizations with the same number of employees may have very different levels of IT intensity. A small hospital with 350 employees, reporting to work in three shifts and sharing limited computing resources, does not compare with an engineering firm with 350 employees that uses high-end workstations.

The revenue size band approach classifies enterprises or organization units based on their domestic revenue (related to the country the unit of observation is based) or assets (for financial services) or the level of total budget (for non-profit or government based organizations). This approach allows an IT vendor using the resulting research and analysis to create size categories related to an organizations ability to purchase IT products and services rather than its need based on the number of employees. However, it is limited, especially with regard to the issue of IT intensity.

A third view of the market that solves the IT intensity issue uses IT spending levels as the metric for size of an organization. The difficulties with this metric are threefold:

! Data is not readily available.

! It is hard to capture information for IT spending in the entire company, not only inside the IT departments, but also across various business units (e.g. marketing).

! IT budgets have variability related to extraordinary projects scheduled in a particular fiscal year.

Typically, the way a vendor's business is structured determines the most logical approach. Although each approach has merit, the most powerful analysis is one that has a control for both industry and size, and, within size, for different metrics.

This study is based on an enterprise-level unit of analysis and its breakout by employee bands. The following company size classifications are used:

! Number of employees:

# 1�9

# 10�99

# 100�249

# 250�499

# 500�999

# 1,000+

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IDC EMEA defines the vertical market categories (with sub-markets detailed according to the General Industrial Classification of Economic Activities within the European Union Divisions, i.e. NACE). For the purpose of this study, some sub-vertical market categories have been reorganized in order to facilitate the collection of information from different sources. IDC's vertical market classification is shown in Table 1.

T A B L E 1

E u r o p ea n V e r t i c a l M a r k e t C o v e r a g e A c c o r d i n g t o N A C E R e v . 1 : G r o u p - L e v e l C l a s s i f i c a t i o n

Description Raw Materials, Agriculture, and Mining 1 Agriculture, hunting, and related service activities 2 Forestry, logging, and related services 5 Fishing 10 Mining of coal and lignite; extraction of peat 12 Mining of uranium and thorium ores 13 Mining of metal ores except uranium and thorium ores 14 Other mining and quarrying Building/Construction 45 Construction Oil and gas 11 Extraction of crude petroleum and natural gas 23 Manufacture of coke, refined petroleum, and nuclear fuel Chemicals 24 Manufacture of chemicals and chemical products, except pharmaceuticals Pharmaceutical 24,4 Pharmaceuticals Other Process Manufacturing 15�16 Food, drink, and tobacco 17 Textile industry 21 Pulp, paper, and board 25 Processing of rubber and plastics 26 Manufacture of nonmetallic mineral products 27 Manufacture of basic ferrous and nonferrous metals 28 Manufacture of fabricated metal products (except machinery and equipment) 37 Recycling Industrial and Commercial Machinery 29 Machinery and equipment Automotive 34 Motor vehicles and motor vehicles parts and accessories Other Transport Equipment 35 Other means of transport Electronics 30 Manufacture of office machinery and computers 31 Electrical machinery and apparatus 32 Electronic engineering 33 Instrument engineering Other Discrete Manufacturing 18 Clothing industry 19 Leather and footwear 20 Manufacture of wood and wood products (except furniture) 22 Publishing, printing, and reproduction of recorded media

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T A B L E 1

E u r o p ea n V e r t i c a l M a r k e t C o v e r a g e A c c o r d i n g t o N A C E R e v . 1 : G r o u p - L e v e l C l a s s i f i c a t i o n

Description 36 Manufacture of furniture; manufacturing not elsewhere classified Transport 60,1 Railways 60,2 Other land transport (e.g., urban transport, and road transport) 61,2 Inland water transport 61,1 Sea transport and coastal shipping 62 Air transport Communications and broadcasting Communications and Broadcasting 64,2 Telecommunications services 92,2 TV and radio broadcasting Utilities 40,1 Production and distribution of electricity 40,2 Manufacture of gas; distribution of gaseous fuels through mains 40,3 Steam and hot water supply 41 Collection, purification, and distribution of water Retail/Wholesale 50 Sale, maintenance, and repair of motor vehicles; retail sale of fuel 51 Wholesale 52 Retail distribution 55 Hotels and restaurants Finance 65 Banking 66 Insurance 67 Activities auxiliary to financial intermediation, except insurance and pension Business Services 63 Supporting services to transport 70 Real estate activities 72 Computer and related services 73 Research and development 74 Other business activities (legal, accounting, market research, consultancy,

architectural and engineering activities, advertising, labor recruitment, investigation, industrial cleaning)

Central and Local Government 75 Administration of the state and economic and social policy of the community Health 85 Healthcare and social work Education 80 Education Other Services 64,1 Postal services 71 Renting, leasing, and hiring of movables 90 Sewage and refusal disposal, sanitation and similar activities 91 Activities of membership organization 92 Recreational, cultural, and sporting activities 93 Other services 95 Private household with employed persons 99 Extraterritorial organization and bodies

Source: NACE Rev. 1, 2002

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S I T U AT I O N O V E R V I E W

According to the results of this study, Western Europe has almost 11 million enterprises in 16 countries.

The backbone of the Western European economy, the SMBs (firms with fewer than 500 employees), account for 99.8% of the total number of enterprises, giving employment to almost 70% of the total workforce. In particular, there are almost 11 million small and medium companies, while there are around 21,000 large companies.

The average number of employed people per enterprise confirms that Western Europe is primarily formed by small and medium businesses. According to IDC, an average of 12 people work at each Western European organization.

N u m b e r o f E n t e r p r i s e s

As can be seen in Table 2, micro-enterprises (1�9 employees) represent 85% of the total number of enterprises while the small segment as a whole (1�99 employees) accounts for 98.8% of the total. There are approximately 110,000 midsize companies (100�499 employees), or 1% of the total, while there are around 21,000 large firms (500 or more employees), or 0.2% of the total universe of enterprises in Western Europe.

T A B L E 2

W e s t e r n E u r o p e , T o t a l N u m b e r o f E n t e r p r i s e s b y E m p l o y e e S i z e , 2 0 0 5

1�9 Employees

10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

Total Western Europe

Number of enterprises

9,255,477 1,543,570 84,140 26,009 13,125 7,976 10,930,297

% of total 84.68% 14.12% 0.77% 0.24% 0.12% 0.07% 100.00%

Source: IDC, 2005

SMBs' demographic structure is very heterogeneous across Western European countries and industries. The major share of enterprises is concentrated in the top 5 countries: Germany, France, Italy, Spain, and the U.K.

! Top-ranking Germany has around 2 million companies. Germany has a high number of SMBs in the "mittelstand" or midmarket environment.

! With approximately 1.7 million companies, the distribution of companies by size class in France is quite homogeneous.

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! In southern Europe, Italy (with around 1.6 million firms) and Spain (with around 1.3 million) have a majority of companies in the fewer-than-100-employee size class.

! The U.K. has almost 1.2 million companies, and has a high share of the total number of large and very large companies in Western Europe.

T A B L E 3

W e s t e r n E u r o p e , P e r c en t a g e D i s t r i b u t i o n o f E n t e r p r i s e s b y C o u n t r y a n d E m p l o y e e S i z e , 2 0 0 5

Countries 1�9 Employees

10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

Austria 4.7% 4.4% 3.1% 2.9% 2.3% 2.1% Belgium 2.0% 2.0% 2.1% 2.8% 2.4% 2.6% Denmark 1.1% 1.4% 1.8% 1.7% 1.5% 1.4% Finland 1.4% 1.3% 1.3% 1.3% 1.3% 1.4% France 17.2% 5.4% 7.0% 15.1% 16.2% 15.7% Germany 17.9% 23.1% 31.8% 28.0% 22.0% 22.2% Greece 7.4% 3.2% 1.5% 1.4% 1.0% 0.6% Ireland 2.1% 3.1% 1.9% 0.9% 1.2% 0.8% Italy 14.4% 14.5% 10.1% 8.8% 9.1% 11.2% Netherlands 2.9% 3.6% 4.6% 5.2% 5.2% 6.9% Norway 1.2% 1.5% 1.4% 1.3% 1.3% 0.7% Portugal 2.8% 2.8% 2.7% 2.2% 1.9% 2.0% Spain 10.7% 17.4% 15.2% 10.4% 8.3% 9.6% Sweden 2.0% 2.1% 2.1% 2.4% 4.0% 4.1% Switzerland 1.6% 2.8% 2.0% 3.2% 2.4% 2.1% U.K. 10.5% 11.4% 11.3% 12.6% 20.0% 16.7% Total Western Europe 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%

Source: IDC, 2005

Table 4 shows that the average Western European company employs 12 people, confirming the small size tendency in the economic environment. At a country level, there are some differences: Greece tends to have a micro-enterprise environment, with an average of four people, while U.K. and Dutch firms have the highest average size, with 21 employees by company.

IDC segments countries into three groups according to average enterprise size:

! Those with the smallest organizations (Austria, Greece, Ireland) with up to nine employees

! Those with 10 to 19 employees (Belgium, Denmark, Finland, France, Germany, Italy, Norway, Portugal, Spain, Sweden, and Switzerland)

! Those with an average of 20 or more employees (the Netherlands and the U.K.)

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T A B L E 4

W e s t e r n E u r o p e , E m p l o y m en t I n d i c a t o r s b y C o u n t r y , 2 0 0 5

Countries Enterprises Employment Average Enterprise Size Austria 505,424 3,258,023 6 Belgium 220,534 3,454,500 16 Denmark 126,434 2,445,783 19 Finland 154,007 2,052,999 13 France 1,685,674 19,804,666 12 Germany 2,054,971 26,828,232 13 Greece 739,925 2,598,751 4 Ireland 239,737 1,483,580 6 Italy 1,569,111 15,665,710 10 Netherlands 330,075 6,977,750 21 Norway 136,467 2,084,499 15 Portugal 306,472 3,745,669 12 Spain 1,278,859 13,538,795 11 Sweden 218,581 3,876,001 18 Switzerland 196,545 3,186,000 16 U.K. 1,167,481 24,063,672 21 Total Western Europe 10,930,297 135,064,630 12

Source: IDC, 2005

The Workforce

By analyzing employment distribution across Western European countries, some interesting findings can be found, as seen in Tables 5 and 6:

! SMBs employ 68% of the total Western European workforce. Small companies account for 51% of employees, midsize companies 17%, and large and very large companies the remaining 32%.

! Germany has the biggest workforce population in Western Europe, with almost 27 million employees. The highest share of its workforce is in very large companies with more than 1,000 employees (33.7%).

! With more than 24 million employees, the U.K. follows Germany and has the second major workforce population in Western Europe.

! Italy has the highest share of its workforce employed in micro-enterprises (1�9 employees).

! French employees work mainly in micro, small, and very large companies. 18% work in companies with fewer than 10 employees, 24% in companies with fewer than 100 employees, and 30% in companies with more than 1,000 employees.

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T A B L E 5

W e s t e r n E u r o p e , D i s t r i b u t i o n o f E m p l o y m en t b y S i z e , 2 0 0 5


10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

Total

Austria 572,681 1,158,938 336,073 250,449 285,595 654,287 3,258,023 Belgium 777,291 824,136 399,688 273,502 262,232 917,651 3,454,500 Denmark 509,019 924,459 252,150 172,977 189,213 397,965 2,445,783 Finland 500,279 719,629 183,489 132,614 157,270 359,718 2,052,999 France 3,496,922 4,783,049 1,477,617 1,963,260 2,120,063 5,963,755 19,804,666 Germany 3,673,834 6,192,950 3,239,494 2,408,522 2,276,026 9,037,406 26,828,232 Greece 1,067,541 726,530 269,455 178,944 113,415 242,866 2,598,751 Ireland 249,108 513,507 212,107 109,388 156,423 243,047 1,483,580 Italy 5,820,387 3,961,826 1,154,587 756,251 616,531 3,356,128 15,665,710 Netherlands 1,411,070 1,981,657 878,980 563,762 674,164 1,468,117 6,977,750 Norway 735,410 580,473 131,926 95,895 150,356 390,439 2,084,499 Portugal 1,223,434 1,094,257 386,374 261,113 189,067 591,424 3,745,669 Spain 4,357,928 4,458,898 1,382,143 861,229 678,128 1,800,469 13,538,795 Sweden 959,132 954,938 268,435 200,928 433,866 1,058,702 3,876,001 Switzerland 723,888 1,263,451 427,431 279,075 270,610 221,545 3,186,000 U.K. 5,665,806 7,436,572 1,624,636 1,213,796 1,939,187 6,183,675 24,063,672 Total Western Europe

31,743,730 37,575,270 12,624,585 9,721,705 10,512,146 32,887,194 135,064,630

Source: IDC, 2005

T A B L E 6

W e s t e r n E u r o p e , P e r c en t a g e D i s t r i b u t i o n o f E m p l o ym e n t b y S i z e , 2 0 0 5


10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

Austria 17.6% 35.6% 10.3% 7.7% 8.8% 20.1% Belgium 22.5% 23.9% 11.6% 7.9% 7.6% 26.6% Denmark 20.8% 37.8% 10.3% 7.1% 7.7% 16.3% Finland 24.4% 35.1% 8.9% 6.5% 7.7% 17.5% France 17.7% 24.2% 7.5% 9.9% 10.7% 30.1% Germany 13.7% 23.1% 12.1% 9.0% 8.5% 33.7% Greece 41.1% 28.0% 10.4% 6.9% 4.4% 9.3% Ireland 16.8% 34.6% 14.3% 7.4% 10.5% 16.4% Italy 37.2% 25.3% 7.4% 4.8% 3.9% 21.4% Netherlands 20.2% 28.4% 12.6% 8.1% 9.7% 21.0% Norway 35.3% 27.8% 6.3% 4.6% 7.2% 18.7% Portugal 32.7% 29.2% 10.3% 7.0% 5.0% 15.8% Spain 32.2% 32.9% 10.2% 6.4% 5.0% 13.3% Sweden 24.7% 24.6% 6.9% 5.2% 11.2% 27.3% Switzerland 22.7% 39.7% 13.4% 8.8% 8.5% 7.0% U.K. 23.5% 30.9% 6.8% 5.0% 8.1% 25.7% Total Western Europe

23.5% 27.8% 9.3% 7.2% 7.8% 24.3%

Source: IDC, 2005

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As mentioned above, the average Western European company has 12 employees, but average employment by company size differs greatly from country to country (Table 7).

A Western European SMB in the fewer-than-10-employee size band has on average three employees. A company in the 10�99 employee segment an average of 24 employees. A company in the 100�249 employee size class has an average of 150 employees. A company in the 250�499 employee size class has an average of 374 employees. Large and very large Western European firms have an average of 801 and 4,123 employees, respectively.

T A B L E 7

W e s t e r n E u r o p e , A v e r a g e E m p l o ym en t b y C o m p a n y S i z e , 2 0 0 5


10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

Austria 1 17 130 327 930 3,965 Belgium 4 27 227 381 846 4,433 Denmark 5 42 168 390 970 3,553 Finland 4 36 162 399 953 3,270 France 2 57 249 499 999 4,767 Germany 2 17 121 331 789 5,097 Greece 2 15 221 492 907 5,520 Ireland 1 11 132 478 996 3,984 Italy 4 18 136 332 517 3,742 Netherlands 5 36 225 419 984 2,669 Norway 7 26 116 291 890 6,618 Portugal 5 25 168 447 744 3,791 Spain 4 17 108 317 621 2,363 Sweden 5 30 153 326 831 3,258 Switzerland 5 29 249 340 856 1,296 U.K. 6 42 171 372 738 4,639

Source: IDC, 2005

Vertical Analysis

Table 8 shows the distribution of Western European enterprises across industries. The majority of these companies are concentrated in a few verticals. Raw materials, agriculture, and mining; building/construction; retail/wholesale; and business services have 70% of the total universe of enterprises. Most of them can be found in the smallest size classes.

The agriculture and construction sectors are traditionally fragmented into many micro-enterprises, while retail/wholesale and business services follow the trend of the continuous tertiarization of the economy, with the entry of new commercial and intellectual activities.

©2006 IDC #MM01N 13

T A B L E 8

W e s t e r n E u r o p e , N u m be r o f E n t e r p r i s e s b y E m p l o y e e S i z e , 2 0 0 5

1�9 Employees

10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

Raw materials, agriculture, and mining

1,470,162 245,125 6,467 299 131 71

Building construction 937,569 165,217 4,673 1,078 415 211 Oil and gas 812 637 119 67 28 56 Chemical 11,461 7,540 1,180 451 262 149 Pharmaceutical 1,961 1,410 425 194 128 97 Other process 383,361 151,279 11,139 3,389 1,507 635 Industrial and commercial machinery

63,842 33,582 3,199 971 413 273

Automotive 7,018 4,756 895 410 255 208 Other transport equipment 9,457 3,478 377 152 89 121 Electronic and optic equipment and comm. devices

73,152 26,037 2,426 955 479 367

Other discrete 293,536 83,422 3,875 1,131 434 200 Transport 238,867 41,928 1,699 744 300 235 Communication 16,478 4,061 531 216 122 115 Utilities 9,288 3,919 598 257 157 120 Retail and wholesale 2,760,464 336,297 11,912 3,880 1,524 1,089 Finance 128,466 20,544 2,808 1,055 541 558 Central and local government 55,168 35,018 6,549 2,377 2,101 854 Health care 490,623 86,886 7,087 2,088 1,553 1,133 Education 132,514 42,994 3,335 710 410 258 Business services 1,556,101 182,945 11,579 4,372 1,855 917 Other services 615,177 66,495 3,267 1,213 421 309 Total 9,255,477 1,543,570 84,140 26,009 13,125 7,976

Source: IDC, 2005

Retail and wholesale activities represent 28.5% of the total number of enterprises in Western Europe (Table 9). Germany has the highest number of distributive trade companies with around 585,000 units. In second place stands Italy, with almost 494,000 companies, followed by France, Spain, and the U.K.

14 #MM01N ©2006 IDC

T A B L E 9

W e s t e r n E u r o p e , N u m be r o f E n t e r p r i s e s i n R e t a i l a n d W h o l e s a l e b y E m p l o y e e S i z e , 2 0 0 5

1�9 Employees

10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

France 426,153 13,483 258 589 334 110 Germany 490,405 89,919 3,806 1,001 54 239 Italy 450,994 41,657 834 231 83 65 Spain 326,505 43,262 1,721 489 181 129 U.K. 313,450 51,195 2,145 655 411 284 Other Western Europe 752,957 96,781 3,148 915 461 262

Source: IDC, 2005

Western European financial organizations (including banks, insurance companies, and financial intermediation) number around 154,000. As shown in Table 10, Germany has the largest number of financial institutions, while Spain has the highest market concentration.

T A B L E 1 0

W e s t e r n E u r o p e , N u m be r o f E n t e r p r i s e s i n F i n a n c e b y E m p l o y e e S i z e , 2 0 0 5

1�9 Employees

10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

France 10,388 1,763 415 166 62 51 Germany 42,199 7,678 1,143 409 134 176 Italy 21,402 1,906 235 84 63 62 Spain 10,160 858 141 45 48 67 U.K. 13,755 3,140 265 110 97 93 Other Western Europe 30,562 5,199 609 241 137 109

Source: IDC, 2005

Infrastructure industries (transport, communications, and utilities) in Western Europe are populated by 320,000 enterprises, around 3% of the total enterprise population. Table 11 shows that Germany has the highest number of companies, at around 58,000. 77% of these are very small firms with fewer than 10 employees. Spain is in second place, with approximately 39,000 enterprises in this sector.

©2006 IDC #MM01N 15

T A B L E 1 1

W e s t e r n E u r o p e , N u m be r o f E n t e r p r i s e s i n T r a n s po r t , C o m m u n i c a t i o n s a n d U t i l i t i e s b y E m p l o y e e S i z e , 2 0 0 5

1�9 Employees

10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

France 32,513 2,357 141 170 64 52 Germany 45,125 11,885 800 380 119 112 Italy 31,200 6,998 271 122 65 46 Spain 32,053 6,812 253 107 51 48 U.K. 25,114 5,587 353 125 83 84 Other Western Europe 98,628 16,084 993 296 189 127

Source: IDC, 2005

As shown in Table 12, business services activities such as research, real estate, consultancy, advertising, and computer activities account for approximately 1.8 million companies or 16% of total Western European enterprises. Germany dominates the segment with almost 362,000 firms.

T A B L E 1 2

W e s t e r n E u r o p e , N u m be r o f E n t e r p r i s e s i n B u s i n e s s S e r v i c e s b y E m p l o y e e S i z e , 2 0 0 5

1�9 Employees

10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

France 291,352 7,205 413 631 388 113 Germany 298,482 57,561 3,910 1,349 239 188 Italy 182,743 20,555 1,179 393 162 76 Spain 174,854 21,315 1,378 563 225 173 U.K. 256,870 33,535 1,895 615 464 136 Other Western Europe 351,800 42,774 2,804 821 377 231

Source: IDC, 2005

The public sector in Western Europe (including central, regional, and local government, as well as health and education) accounts for approximately 872,000 units (Table 13). In particular, there are 865,000 SMBs. Germany has the highest number of institutions in the micro-segment (1�9 employees), at 298,000, followed by France, with around 291,000. The public sector as a whole represents 8% of the total enterprise population in Western Europe.

16 #MM01N ©2006 IDC

T A B L E 1 3

W e s t e r n E u r o p e , N u m be r o f E n t e r p r i s e s i n G o v e r n m e n t , H ea l t h c a r e , a n d E d u c a t i o n b y E m p l o y ee S i z e , 2 0 0 5

1�9 Employees

10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

France 188,087 21,030 2,334 812 507 445 Germany 227,118 58,599 6,799 1,388 1,184 259 Italy 60,269 15,390 1,563 387 415 412 Spain 38,967 16,399 1,649 458 214 175 U.K. 45,150 21,870 820 395 824 301 Other Western Europe 118,714 31,610 3,806 1,735 920 653

Source: IDC, 2005

Table 14 shows that discrete and process manufacturing accounts for almost 1.2 million enterprises in Western Europe. They are concentrated mainly in Italy, with more than 307,000 units or roughly 26% of the total number of manufacturing companies in the region. In second place is Germany, with almost 223,000 companies, of which 66% are micro-enterprises (fewer than 10 employees).

T A B L E 1 4

W e s t e r n E u r o p e , N u m be r o f E n t e r p r i s e s i n M a n u f a c t u r i n g b y E m p l o y e e S i z e , 2 0 0 5

1�9 Employees

10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

France 117,404 23,021 1,092 1,183 607 354 Germany 147,179 63,781 7,949 2,038 1,018 657 Italy 212,677 89,645 3,647 931 353 208 Spain 94,861 40,295 2,249 592 244 111 U.K. 79,935 31,840 2,925 1,020 507 319 Other Western Europe 191,732 62,922 5,654 1,889 838 401

Source: IDC, 2005

See Tables 15 to 30 in the appendix for details on number of enterprises across Western European countries for 2005 by employee size and sub-vertical markets.

©2006 IDC #MM01N 17

F U T U R E O U T L O O K

S h o r t - T e r m P r o s p e c t s f o r E u r o p e a n E m p l o y m e n t

Economic growth in Europe has contributed far less to employment growth if compared to other regions. This lower employment intensity reflects to a large degree the impact of structural rigidities (limited flexibility and higher labor costs) in Europe's labor markets.

Six years after the European Council adopted the Lisbon Agenda, growth rates remain lower than the projections, and the number of new jobs that have been created is not sufficient to reach the targeted employment rates. The Lisbon Agenda's main goals were to raise European competitiveness, encourage economic growth, promote structural reform, and create jobs.

According to the European Commission's latest forecast, economic growth in 2006 is expected to reach 2.2% in the European Union and 1.9% in the euro-area. Consequently, employment growth in the EU is expected to increase slightly to above 1%.

Four of the five 5 countries (France, Germany, Italy, and Spain) are still suffering from structural weaknesses such as limited incentives for people to enter or return to the labor market, or barriers to their re-entry. This is largely due to either delays in reforms kicking in or having only introduced limited reforms.

S h o r t - T e r m P r o s p e c t s f o r t h e E u r o p e a n B u s i n e s s D e m o g r a p h y

The European SMB market has a higher dynamism than larger companies, with numerous entries and exits from the market, depending on many factors such as the economic cycle, industry maturity and concentration, barriers to entry, etc. New enterprises tend to be relatively small in size (as measured by their average number of employees) and employment creation rates by these firms are usually low.

The most dynamic economic sectors in Europe can be found in the construction, retail/wholesale, and business services activities. Low barriers to entry characterize the services sector; therefore, very small enterprises may find it relatively easy to start or exit the business. The dynamism shown in these sectors (construction, retail/wholesale, and business services) is expected to continue in the short to medium term.

18 #MM01N ©2006 IDC

E S S E N T I AL G U I D A N C E

In comparison with other regions, the business demography of Western Europe shows the prevalence of the small firm. The average Western European company has only 12 employees. Most SMBs are micro-enterprises serving local markets and for the most part struggling to keep on business in a unified and fiercely competitive European environment.

Understanding SMBs' structural characteristics, by size segment, country, and vertical market, is therefore essential for IT vendors to build effective go-to-market strategies. In particular, vendors should consider that:

! Micro and small enterprises account for 98.8% of the Western European enterprise population. This market is vast and mostly untapped.

! The top 5 countries in the region (Italy, Germany, France, Spain, and the U.K.) account for 71% of the total enterprise population and 74% of the total workforce. During 2005, these five countries accounted for around 73% of the Western European total IT spending.

! The vertical markets that account for the majority of the enterprise population are building/construction, retail/wholesale, and business services. However, vendors should also note that these sectors are the ones that reported the highest dynamism (in terms of enterprise birth and enterprise death rates) and that this trend is expected to continue in the short to medium term.

A p p e n d i x

Number of Enterprises Across Each Western European Country

Tables 15 to 30 show the number of enterprises across Western European countries for 2005, disaggregated by company size and sub-vertical markets.

©2006 IDC #MM01N 19

T A B L E 1 5

A u s t r i a , N u m b e r o f E n t e r p r i s e s b y E m p l o y e e S i z e , 2 0 0 5

1�9 Employees

10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

Total


184,307 30,670 210 28 7 3 215,225

Building/construction 17,709 5,440 211 34 15 12 23,421 Oil and gas 4 5 3 1 1 1 15 Chemical 187 103 26 5 7 4 332 Pharmaceutical 51 24 8 8 2 0 93 Other process 7,797 3,356 365 145 46 5 11,714 Industrial and commercial machinery

1,386 673 71 64 13 8 2,215

Automotive 134 85 14 21 3 6 263 Other transport equipment 85 19 2 4 2 2 114 Electronics 1,582 497 48 46 18 0 2,191 Other discrete 9,491 1,995 105 40 15 8 11,654 Transport 9,620 1,852 96 13 8 5 11,594 Communications 360 58 9 4 3 5 439 Utilities 773 95 32 7 10 7 924 Retail/wholesale 107,678 12,478 386 101 61 45 120,749 Finance 4,921 744 70 30 16 16 5,797 Central and local government

703 1,760 268 93 37 10 2,871

Health 13,941 508 34 12 2 5 14,502 Education 3,715 2,648 296 31 3 1 6,694 Business services 66,861 5,055 328 77 36 19 72,376 Other services 2,054 168 13 1 2 3 2,241 Total 433,359 68,233 2,595 765 307 165 505,424

Source: IDC, 2005

20 #MM01N ©2006 IDC

T A B L E 1 6

B e l g i u m , N u m b e r o f E n t e r p r i s e s b y E m p l o y ee S i z e , 2 0 0 5

1�9 Employees

10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

Total


33,042 1,977 36 15 4 5 35,079


728 393 45 11 7 5 1,189

Automotive 188 124 23 10 4 9 358 Other transport equipment 94 57 3 1 2 4 161 Electronics 719 293 37 12 11 13 1,085 Other discrete 4,174 1,415 98 23 8 2 5,720 Transport 4,179 1,734 44 20 9 5 5,991 Communications 831 73 34 9 4 4 955 Utilities 17 2 1 0 1 5 26 Retail/wholesale 73,008 9,538 266 70 40 21 82,943 Finance 1,515 212 47 15 14 13 1,816 Central and local government 180 176 54 32 17 18 477 Health 1,876 1,870 152 237 55 21 4,211 Education 2,537 885 41 14 3 16 3,496 Business services 20,418 3,488 265 96 43 29 24,339 Other services 11,221 1,280 20 14 7 2 12,544 Total 186,679 30,863 1,757 718 310 207 220,534

Source: IDC, 2005

©2006 IDC #MM01N 21

T A B L E 1 7

D e n m a r k , N u m b e r o f E n t e r p r i s e s b y E m p l o y ee S i z e , 2 0 0 5

1�9 Employees

10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

Total


10,790 510 8 3 3 2 11,316


656 308 30 11 5 3 1,013

Automotive 122 12 5 5 2 1 147 Other transport equipment 90 6 5 2 2 1 106 Electronics 276 139 15 10 3 1 444 Other discrete 2,753 1,895 208 37 14 5 4,912 Transport 6,032 1,384 67 29 10 7 7,529 Communications 333 102 27 11 8 7 488 Utilities 480 81 5 5 2 1 574 Retail/wholesale 29,879 5,821 217 71 32 19 36,039 Finance 1,003 269 66 11 4 3 1,356 Central and local government 56 75 209 81 47 21 489 Health 7,852 1,532 46 3 9 7 9,449 Education 961 1,093 54 39 15 10 2,172 Business services 15,643 2,825 182 52 6 10 18,718 Other services 9,577 1,127 71 6 1 5 10,787 Total 102,241 21,939 1,504 443 195 112 126,434

Source: IDC, 2005

22 #MM01N ©2006 IDC

T A B L E 1 8

F i n l a n d , N u m b e r o f E n t e r p r i s e s b y E m p l o y e e S i z e , 2 0 0 5

1�9 Employees

10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

Total


21,444 5,548 253 9 4 3 27,261


1,852 492 70 17 11 6 2,448

Automotive 200 62 7 3 2 1 275 Other transport equipment 516 79 9 2 4 1 611 Electronics 1,003 284 40 19 11 5 1,362 Other discrete 5,405 979 83 23 9 6 6,505 Transport 13,877 827 34 16 5 5 14,764 Communications 296 127 14 9 6 7 459 Utilities 812 98 7 7 2 1 927 Retail/wholesale 26,302 3,821 144 61 40 18 30,386 Finance 2,763 353 29 11 5 5 3,166 Central and local government 169 257 33 11 4 2 476 Health 9,044 398 12 1 4 0 9,459 Education 1,067 75 5 5 2 0 1,154 Business services 20,716 2,673 176 52 17 12 23,646 Other services 7,333 402 30 10 4 4 7,783 Total 132,258 20,012 1,130 332 165 110 154,007

Source: IDC, 2005

©2006 IDC #MM01N 23

T A B L E 1 9

F r an c e , N u m b e r o f E n t e r p r i s e s b y E m p l o y e e S i z e , 2 0 0 5

1�9 Employees

10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

Total


319,120 2,681 958 133 22 28 322,942

Building/construction 133,348 6,870 78 146 63 50 140,555 Oil and gas 62 128 21 6 5 11 233 Chemical 1,940 817 72 83 55 30 2,997 Pharmaceutical 226 193 54 31 27 25 556 Other process 53,697 10,862 428 595 292 113 65,987 Industrial and commercial machinery

8,034 2,509 158 111 49 33 10,894

Automotive 786 767 126 50 19 39 1,787 Other transport equipment

1,507 342 22 26 14 25 1,936

Electronics 11,106 1,408 71 120 83 57 12,845 Other discrete 40,108 6,123 161 167 68 32 46,659 Transport 28,771 1,655 68 139 40 33 30,706 Communications 2,307 258 10 13 12 9 2,609 Utilities 1,435 444 63 18 12 10 1,982 Retail/wholesale 426,153 13,483 258 589 334 110 440,927 Finance 10,388 1,763 415 166 62 51 12,845 Central and local government

33,278 4,383 853 377 289 187 39,367

Health 123,280 13,886 1,231 391 208 250 139,246 Education 31,529 2,761 250 44 10 8 34,602 Business services 291,352 7,205 413 631 388 113 300,102 Other services 70,409 5,077 214 90 70 37 75,897 Total 1,588,836 83,615 5,924 3,926 2,122 1,251 1,685,674

Source: IDC, 2005

24 #MM01N ©2006 IDC

T A B L E 2 0

G e r m a n y , N u m b e r o f E n t e r p r i s e s b y E m p l o y ee S i z e , 2 0 0 5

1�9 Employees

10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

Total


58,995 7,976 165 7 24 12 67,179

Building/construction 175,612 38,450 990 179 27 16 215,274 Oil and gas 40 36 6 3 2 3 90 Chemical 1,499 1,453 390 114 68 40 3,564 Pharmaceutical 564 351 89 32 25 23 1,084 Other process 71,082 32,203 3,765 877 366 171 108,464 Industrial and commercial machinery

12,545 8,632 1,370 332 171 116 23,166

Automotive 1,363 905 226 100 122 66 2,782 Other transport equipment

994 487 82 27 21 37 1,648

Electronics 19,423 8,677 1,059 332 158 166 29,815 Other discrete 39,709 11,073 968 224 87 38 52,099 Transport 39,879 8,954 392 182 54 50 49,511 Communications 3,088 1,212 135 65 27 15 4,542 Utilities 2,158 1,719 273 133 38 47 4,368 Retail/wholesale 490,405 89,919 3,806 1,001 54 239 585,424 Finance 42,199 7,678 1,143 409 134 176 51,739 Central and local government

14,024 14,149 2,475 629 392 69 31,738

Health 178,860 28,664 3,197 672 645 155 212,193 Education 34,234 15,786 1,127 87 147 35 51,416 Business services 298,482 57,561 3,910 1,349 239 188 361,729 Other services 174,612 20,610 1,203 525 85 111 197,146 Total 1,659,767 356,495 26,771 7,279 2,886 1,773 2,054,971

Source: IDC, 2005

©2006 IDC #MM01N 25

T A B L E 2 1

G r e e c e , N u m b e r o f E n t e r p r i s e s b y E m p l o y e e S i z e , 2 0 0 5

1�9 Employees

10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

Total


337,293 31,734 171 34 7 1 369,240


2,351 277 8 2 1 1 2,640

Automotive 265 30 3 1 1 1 301 Other transport equipment

549 102 5 2 0 1 659

Electronics 1,455 200 3 1 1 1 1,661 Other discrete 18,374 1,634 67 17 5 1 20,098 Transport 11,913 247 12 5 2 1 12,180 Communications 1,399 123 14 8 2 0 1,546 Utilities 594 46 4 1 1 1 647 Retail/wholesale 161,838 6,282 273 73 28 7 168,501 Finance 2,480 64 14 4 4 7 2,573 Central and local government

135 472 146 78 11 5 847

Health 7,333 611 49 1 5 0 7,999 Education 3,377 1,657 29 27 9 0 5,099 Business services 38,317 1,382 79 30 12 3 39,823 Other services 15,596 728 27 7 3 1 16,362 Total 689,144 49,026 1,222 364 125 44 739,925

Source: IDC, 2005

26 #MM01N ©2006 IDC

T A B L E 2 2

I r e l a n d , N u m b e r o f E n t e r p r i s e s b y E m p l o y e e S i z e , 2 0 0 5

1�9 Employees

10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

Total


103,132 40,075 523 9 7 5 143,751

Building/construction 6,935 802 256 22 9 1 8,025 Oil and gas 66 30 6 5 1 6 114 Chemical 95 38 14 5 1 1 154 Pharmaceutical 36 14 7 1 1 1 60 Other process 1,980 341 87 11 28 1 2,448 Industrial and commercial machinery

220 89 20 3 1 1 334

Automotive 43 16 11 1 1 1 73 Other transport equipment

27 11 4 1 1 1 45

Electronics 270 99 55 12 2 0 438 Other discrete 1,043 127 22 13 19 0 1,224 Transport 4,161 192 24 6 2 2 4,387 Communications 75 16 13 1 1 0 106 Utilities 9 3 2 1 1 1 17 Retail/wholesale 35,400 1,758 199 22 6 1 37,386 Finance 5,724 625 52 40 15 5 6,461 Central and local government

10 20 35 25 29 30 149

Health 2,442 761 69 24 13 0 3,309 Education 3,269 814 43 13 3 0 4,142 Business services 14,972 1,026 119 8 14 2 16,141 Other services 9,909 1,003 51 6 2 2 10,973 Total 189,818 47,860 1,612 229 157 61 239,737

Source: IDC, 2005

©2006 IDC #MM01N 27

T A B L E 2 3

I t a l y , N u m b e r o f E n t e r p r i s e s b y E m p l o y ee S i z e , 2 0 0 5

1�9 Employees

10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

Total


144,626 17,069 288 10 7 2 162,002

Building/construction 164,407 25,254 287 52 22 8 190,030 Oil and gas 145 200 20 8 3 6 382 Chemical 2,081 1,534 155 44 25 12 3,851 Pharmaceutical 143 229 64 23 18 17 494 Other process 105,491 43,123 1,677 397 141 65 150,894 Industrial and commercial machinery

15,526 9,848 619 150 50 34 26,227


1,586 783 51 17 8 9 2,454

Electronics 17,945 6,643 321 103 50 35 25,097 Other discrete 69,456 26,723 635 142 36 16 97,008 Transport 29,189 6,310 196 88 37 28 35,848 Communications 1,460 297 17 8 11 8 1,801 Utilities 551 391 58 26 17 10 1,053 Retail/wholesale 450,994 41,657 834 231 83 65 493,864 Finance 21,402 1,906 235 84 63 62 23,752 Central and local government

1,381 6,244 844 215 294 71 9,049

Health 48,762 6,474 572 135 101 303 56,347 Education 10,126 2,672 147 37 20 38 13,040 Business services 182,743 20,555 1,179 393 162 76 205,108 Other services 64,442 4,662 178 61 19 12 69,374 Total 1,332,905 223,336 8,502 2,279 1,192 897 1,569,111

Source: IDC, 2005

28 #MM01N ©2006 IDC

T A B L E 2 4

N e t h e r l a n d s , N u m b e r o f E n t e r p r i s e s b y E m p l o y e e S i z e , 2 0 0 5

1�9 Employees

10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

Total


18,105 1,645 15 5 0 0 19,770


1,600 1,200 125 25 5 0 2,955

Automotive 210 170 25 10 0 0 415 Other transport equipment 640 220 20 10 5 0 895 Electronics 1,520 615 60 25 0 0 2,220 Other discrete 5,905 2,015 110 50 30 25 8,135 Transport 6,475 2,670 140 25 15 10 9,335 Communications 650 160 50 5 4 6 875 Utilities 60 30 15 5 15 5 130 Retail/wholesale 96,020 15,995 580 150 90 65 112,900 Finance 6,670 950 65 35 20 15 7,755 Central and local government 85 290 240 95 50 75 835 Health 22,955 3,310 340 215 165 185 27,170 Education 2,930 1,630 515 200 70 60 5,405 Business services 41,815 9,725 630 225 105 55 52,555 Other services 34,820 3,445 215 50 21 9 38,560 Total 268,775 54,810 3,910 1,345 685 550 330,075

Source: IDC, 2005

©2006 IDC #MM01N 29

T A B L E 2 5

N o r w a y , N u m b e r o f E n t e r p r i s e s b y E m p l o y e e S i z e , 2 0 0 5

1�9 Employees

10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

Total


18,470 618 15 3 14 1 19,121


851 337 16 4 2 2 1,212

Automotive 51 49 6 2 2 2 112 Other transport equipment 374 217 40 13 3 2 649 Electronics 575 206 24 3 3 0 811 Other discrete 2,609 866 71 11 4 3 3,564 Transport 6,501 817 89 11 6 1 7,425 Communications 184 100 16 5 3 2 310 Utilities 187 200 9 3 15 0 414 Retail/wholesale 29,252 8,281 260 60 51 2 37,906 Finance 621 270 32 17 3 2 945 Central and local government

109 242 63 26 8 6 454

Health 7,121 1,472 13 73 14 6 8,699 Education 1,181 303 7 3 2 1 1,497 Business services 22,524 3,092 196 17 17 17 25,863 Other services 8,041 1,360 61 18 3 1 9,484 Total 112,039 22,731 1,139 330 169 59 136,467

Source: IDC, 2005

30 #MM01N ©2006 IDC

T A B L E 2 6

P o r t u g a l , N u m b e r o f E n t e r p r i s e s b y E m p l o y ee S i z e , 2 0 0 5

1�9 Employees

10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

Total


30,673 2,526 59 4 7 1 33,270


2,856 595 41 11 3 2 3,508

Automotive 262 100 24 11 5 2 404 Other transport equipment 321 70 6 0 3 2 402 Electronics 1,910 188 33 18 12 5 2,166 Other discrete 12,510 4,811 337 68 20 5 17,751 Transport 14,160 1,712 72 19 8 3 15,974 Communications 431 143 19 13 7 13 626 Utilities 208 60 13 3 5 2 291 Retail/wholesale 100,995 13,810 349 80 25 24 115,283 Finance 1,339 366 36 15 7 14 1,777 Central and local government

65 135 69 35 23 19 346

Health 2,889 615 77 7 7 3 3,598 Education 1,660 552 158 6 2 1 2,379 Business services 33,673 3,073 206 84 38 33 37,107 Other services 16,980 2,062 80 27 17 12 19,178 Total 259,191 43,985 2,302 584 254 156 306,472

Source: IDC, 2005

©2006 IDC #MM01N 31

T A B L E 2 7

S p a i n , N u m b e r o f E n t e r p r i s e s b y E m p l o y e e S i z e , 2 0 0 5

1�9 Employees

10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

Total


116,859 92,780 3,641 20 6 2 213,308

Building construction 129,864 37,059 1,235 224 69 29 168,480 Oil and gas 21 12 4 2 3 3 45 Chemical 1,732 1,193 123 35 22 7 3,112 Pharmaceutical 134 147 60 22 14 4 381 Other process 46,319 21,323 1,236 297 120 46 69,341 Industrial and commercial machinery

5,496 3,137 176 43 14 10 8,876


832 523 47 16 1 6 1,425

Electronic and optic equipment and comm. devices

3,965 1,717 146 47 25 13 5,913

Other discrete 35,501 11,567 346 81 26 6 47,527 Transport 28,774 5,959 155 72 24 20 35,004 Communication 1,711 551 43 17 12 15 2,349 Utilities 1,568 302 55 18 15 13 1,971 Retail and wholesale 326,505 43,262 1,721 489 181 129 372,287 Finance 10,160 858 141 45 48 67 11,319 Central and local government

1,379 5,537 739 327 121 49 8,152

Health care 20,174 4,788 454 96 62 79 25,653 Education 17,414 6,074 456 35 31 47 24,057 Business services 174,854 21,315 1,378 563 225 173 198,508 Other services 68,905 9,650 529 214 51 25 79,374 Total 993,049 268,442 12,800 2,714 1,092 762 1,278,859

Source: IDC, 2005

32 #MM01N ©2006 IDC

T A B L E 2 8

S w e d e n , N u m b e r o f E n t e r p r i s e s b y E m p l o y e e S i z e , 2 0 0 5

1�9 Employees

10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

Total


9,493 451 20 2 2 2 9,970

Building construction 19,777 3,399 75 19 19 4 23,293 Oil and gas 19 6 3 1 1 1 31 Chemical 200 131 19 17 5 2 374 Pharmaceutical 23 27 8 3 1 3 65 Other process 6,698 2,906 207 93 43 36 9,983 Industrial and commercial machinery

1,786 832 97 24 23 13 2,775

Automotive 224 179 31 13 13 7 467 Other transport equipment 427 108 12 3 6 2 558 Electronic and optic equipment and comm. devices

1,538 565 56 27 10 5 2,201

Other discrete 5,337 1,563 121 33 7 8 7,069 Transport 11,013 1,713 45 21 12 4 12,808 Communication 323 87 12 5 9 5 441 Utilities 172 185 17 17 8 1 400 Retail and wholesale 48,987 8,950 276 117 49 25 58,404 Finance 1,942 338 65 21 7 12 2,385 Central and local government

114 111 58 38 26 11 358

Health care 5,863 1,059 116 10 151 101 7,300 Education 3,445 1,125 30 30 66 28 4,724 Business services 47,861 5,600 363 110 57 34 54,025 Other services 18,246 2,538 126 12 7 21 20,950 Total 183,488 31,873 1,757 616 522 325 218,581

Source: IDC, 2005

©2006 IDC #MM01N 33

T A B L E 2 9

S w i t z e r l a n d , N u m b e r o f E n t e r p r i s e s b y E m p l o y e e S i z e , 2 0 0 5

1�9 Employees

10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

Total


13,653 5,755 30 7 5 1 19,451


1,185 995 63 48 16 11 2,318

Automotive 79 52 9 2 1 1 144 Other transport equipment 160 59 4 3 2 3 231 Electronics 2,070 1,196 68 60 25 18 3,437 Other discrete 9,341 2,091 53 27 7 4 11,523 Transport 2,168 1,072 35 13 5 4 3,297 Communications 226 57 10 8 3 2 306 Utilities 109 203 29 8 5 6 360 Retail/wholesale 43,598 10,047 198 110 39 35 54,027 Finance 1,584 1,008 133 42 42 17 2,826 Central and local government 1,280 672 288 75 14 5 2,334 Health 7,341 2,428 225 116 54 6 10,170 Education 3,009 2,054 32 79 0 0 5,174 Business services 29,000 4,835 260 70 32 17 34,214 Other services 12,956 1,620 52 12 7 8 14,655 Total 149,738 43,780 1,720 820 316 171 196,545

Source: IDC, 2005

34 #MM01N ©2006 IDC

T A B L E 3 0

U . K . , N u m b e r o f E n t e r p r i s e s b y E m p l o y ee S i z e , 2 0 0 5

1�9 Employees

10�99 Employees

100�249 Employees

250�499 Employees

500�999 Employees

1,000+ Employees

Total


50,160 3,110 75 10 12 3 53,370

Building construction 99,475 15,435 600 160 106 39 115,815 Oil and gas 205 95 20 15 2 18 355 Chemical 1,475 910 155 69 32 24 2,665 Pharmaceutical 250 95 35 21 16 8 425 Other process 28,810 14,565 1,355 420 223 112 45,485 Industrial and commercial machinery

6,770 3,265 290 115 42 28 10,510

Automotive 1,760 755 145 75 33 33 2,801 Other transport equipment 1,255 395 65 25 15 25 1,780 Electronic and optic equipment and comm. devices

7,795 3,310 390 120 67 48 11,730

Other discrete 31,820 8,545 490 175 79 41 41,150 Transport 22,155 4,830 230 85 63 57 27,420 Communication 2,804 697 108 35 10 17 3,671 Utilities 155 60 15 5 10 10 255 Retail and wholesale 313,450 51,195 2,145 655 411 284 368,140 Finance 13,755 3,140 265 110 97 93 17,460 Central and local government

2,200 495 175 240 739 276 4,125

Health care 30,890 18,510 500 95 58 12 50,065 Education 12,060 2,865 145 60 27 13 15,170 Business services 256,870 33,535 1,895 615 464 136 293,515 Other services 90,076 10,763 397 160 122 56 101,574 Total 974,190 176,570 9,495 3,265 2,628 1,333 1,167,481

Source: IDC, 2005

©2006 IDC #MM01N 35

L E AR N M O R E

R e l a t e d R e s e a r c h

To learn more about IT developments in the Western European SMB market, please refer to the following IDC documents:

! European SMB Confidence Outlook: October�December 2005 (Doc #MM61M, January 2006)

! European SMB Market Watch: October�December 2005 (Doc #MM60M, January 2006)

! Western European SMB IT Spending 2004�2009, Forecast Update (Doc #MM59M, December 2005)

! Pool of Small Firms Pioneers the Use of RFID Technologies � Dolomiti Superski Case Study (Doc #MM11M, November 2005)

! European SMB Market Watch: July�September 2005 (Doc #MM57M, October 2005)

! European SMB Confidence Outlook: July�September 2005 (Doc #MM56M, October 2005)

! 2005 Clustering of Western European SMBs: Where are Real IT Opportunities? (Doc #MM10M, October 2005)

! Outsourcing Strategies among Western European SMBs (Doc #MM09M, September 2005)

! IT Investments: Decision Process and IT Strategy in Western European SMBs, 2005 (Doc #MM08M, August 2005)

! Security Technologies Adoption in Western European SMBs (Doc #MM07M, August 2005)

! New Technologies Adoption Patterns in Western European SMBs (Doc #MM06M, July 2005)

! The IDC Business Size Segmentation Taxonomy (Doc #MM05M, July 2005)

! Mobilizing the Western European SMB Workforce (Doc #MM04M, July 2005)

! Western European SMBs IS Operating Budget Dynamics, Channel Selection and Customer Satisfaction, 2005 (Doc #MM03M, July 2005)

! European SMB Market Watch: April�June 2005 (Doc #MM55M, July 2005)

! European SMB Confidence Outlook: April�June 2005 (Doc #MM54M, July 2005)

! Mapping Solution Priorities in Western European SMBs (Doc #MM02M, July 2005)

36 #MM01N ©2006 IDC

! Western European SMB IT Spending Forecast, 2004�2009 (Doc #MM01M, May 2005)

! European SMB Market Watch: January�March 2005 (Doc #MM53M, May 2005)

! European SMB Confidence Outlook: January�March 2005 (Doc #MM52M, May 2005)

! The Impact of Regulatory Compliance on Western European SMBs (Doc #MM51M, April 2005)

! Western European SMB Market: Structure and Performance Indicators (Doc #MM12L, March 2005)

C o p y r i g h t N o t i c e

This IDC research document was published as part of an IDC continuous intelligence service, providing written research, analyst interactions, telebriefings, and conferences. Visit www.idc.com to learn more about IDC subscription and consulting services. To view a list of IDC offices worldwide, visit www.idc.com/offices. Please contact the IDC Hotline at +44 (0) 20 8987 7107 or [email protected] for information on applying the price of this document toward the purchase of an IDC service or for information on additional copies or Web rights.

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Published Under Services: European Small and Medium Business Markets

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INDUSTRY DEVELOPMENTS AND MODELS Western European …img0.liveinternet.ru/images/attach/b/2/3612/... · Laura Converso IDC OPINION SMBs are the backbone of the Western European economy