Can you tell me how to reduce an image logo to smaller size and still
maintain high resolution clarity?

I have a small logo in one layer.
I want to reduce the size of logo relative to the rest of picture.

However, when I try to reduce the logo size from 1/2" to 1/8" the resolution
and clarity of the logo becomes very poor. In particular, I cannot read all
the wordings.

How can I reduce the size of logo and still keep high resolution quality?
Thank you, Jo