Problems of small business development. Problems of small business in Russia Main problems of small business
Small business concept
Small business includes activities carried out by business entities that are defined by the state as small business enterprises in accordance with the conditions established by current legislation.
Federal Law No. 209-FZ dated July 24, 2007 “On the development of small and medium-sized businesses in the Russian Federation” (as amended on July 26, 2017) contains conditions, the fulfillment of which means classifying an enterprise as a small business. According to Article 4 of this law, criteria are established for the average number of personnel, the amount of income and special requirements.
From the point of view of the content and specifics of small business, this form of economic relations means working in conditions of complete independence, property responsibility, risk, and the entrepreneur is the sole owner of his enterprise. Small businesses are often characterized by full involvement in the business of both the entrepreneur himself and his family members, the so-called " family business".
Small enterprises are simultaneously employers, producers of products, services, works, catalysts of scientific and technological progress, taxpayers, and economic agents. Which together determines their role in the economy.
Criteria for small businesses
Federal Law of July 24, 2007 No. 209-FZ “On the development of small and medium-sized businesses in the Russian Federation” (as amended on July 26, 2017) in Art. 4 contains the following criteria for classifying enterprises as small businesses.
|
Share in a small enterprise |
Average headcount |
Annual income |
|---|---|---|
|
Special requirements are specified in detail in subparagraph “a” of paragraph 1 of part 1.1 of Article 4 (at least one of the requirements must be met). In this case, the requirements relate to limiting the share of participation of the Russian Federation, constituent entities of the Russian Federation, municipalities, non-profit organizations, which should not exceed 25%, and the share of participation of foreign organizations should not exceed 49%. It is separately stipulated that these requirements do not apply to small enterprises from the high-tech (innovative) sector of the economy. There is also a restriction on ownership of voting shares. |
The average number of employees should not exceed 100 people, while micro-enterprises with average number up to 15 people (subparagraph “a” of paragraph 2 of part 1.1 of article 4). |
The annual income of an enterprise does not exceed 800 million rubles and 120 million rubles for micro-enterprises (clause 3 of part 1.1 of article 4). At the same time, income limits are set a separate act: Decree of the Government of the Russian Federation dated April 4, 2016 N 265 “On the maximum values of income received from business activities for each category of small and medium-sized businesses.” |
The role of small business in the economy
The role of small business is manifested at the macro and micro levels of the economy, as well as socially.
| Direction | Characteristic |
|---|---|
| Macro level of the economy. From the point of view of the functioning of the national economic system, the role and importance of small business is expressed in the following indicators: |
An increase in these indicators over time indicates an increase in the role of small businesses in the country's economy. |
| Micro level of the economy. The role of small business in the national economy is determined by the following circumstances: |
|
| The social role of small business in the economy |
|
Small business in Russia
From the point of view of the meaningful role of small business in the economy of the Russian Federation, changing economic conditions require that this sector of the national economic system enter a path of sustainable growth. Small businesses are receiving increased attention from the state: in recent years, the registration procedure for new enterprises and individual entrepreneurs has been significantly simplified, including the possibility of electronic business registration, programs to support small businesses in targeted and priority industries and areas of activity are being implemented, administrative barriers, inspections, etc. have been reduced. d.
In recent years, bureaucratic operations in government institutions for small enterprises have become shorter than in financial and credit institutions.
At the same time, small businesses should occupy more serious positions in the structure of the Russian economy, improving macroeconomic indicators. Accordingly, in this area, continued implementation of state policy to stimulate the development of small businesses is required. Today the state is faced with the task of developing production and supporting small businesses. Small business should not be focused only on major cities countries.
Problems and prospects of small business in Russia
Small businesses currently require a transition to a qualitatively new state and the search for new growth points, which is due to the rapid development information technologies, import substitution policy, state rate to build a digital economy.
Existing prerequisites for this moment has a positive impact on small businesses in the main production areas, this applies, first of all, to enterprises engaged in the production of Russian goods for the population, as well as the provision of services and performance of work.
At the same time, it would be naive to believe that small business can become the basis of the country’s economy: that’s why it is small so that its contribution to the economy is small enough. For large enterprises, small businesses can serve as a connecting link, and for the population - as a function of expanding the range of goods, services, and works. The industries and areas of activity in which small businesses can play a key role are determined by traditional areas for this sector: production of consumer goods, services, trade, public catering, food industry.
Problems of small business in Russia determined by factors that complicate its development:
- presence of inconsistencies in legal support activities of small businesses;
- difficulties in accessing financial, property and information resources;
- the weak role of entrepreneurs' associations in the development of small businesses in general;
- low degree of socio-economic and organizational differentiation among small enterprises (creation typical enterprises producing standard products and services);
- absence integrated system training entrepreneurs in educational institutions, in particular, in certain areas of management, finance, legal support, production organization, business ethics, pricing, marketing, etc.
- as a result, novice entrepreneurs low level financial and legal literacy, difficulties with organizing management and production, which leads to big problems in business, slowdown in the development of small businesses, even to ruin.
The solution to these problems is facilitated by the state policy of supporting small businesses and stimulating their development. The state policy for supporting small businesses includes the following areas: regulatory, financial and credit, information and technical, organizational, personnel and consulting support; foreign economic activity is highlighted as a separate area.
Prospects for small business in Russia related to the following areas:
- Organization of new projects and small enterprises for the production of industrial and agricultural products in the context of the implementation of the import substitution policy in Russia.
- Creation of innovative small enterprises focused on IT technologies, implementation of information technologies and developments.
- Continued implementation of plans to support small businesses from the state.
- Implementation of the target principle of promoting small businesses, focused on the export of products, innovation, social sphere, high-tech products.
- Tax benefits for newly created small businesses.
- Elimination of administrative barriers, reduction in the number of inspections by regulatory authorities, facilitating the work of small enterprises in organizational and managerial terms.
Specific directions for realizing the prospects of small business in modern conditions in Russia:
- combining several areas and types of activities within one small enterprise;
- use of the innovative potential of the enterprise, owner and employees, use of high professional level, education and qualifications of managers of small enterprises;
- adaptation of small enterprises to a difficult economic situation in a short time in the absence of complete and reliable information about the dynamics of market conditions;
- development of cooperation with large enterprises, various options for implementing individual works to ensure the uninterrupted functioning of large industry;
- development of cooperation with other small and medium-sized enterprises.
conclusions
The advantages of small business in Russia are determined by the mobility of small enterprises, deepening specialization, and cooperation of business entities. This helps to increase the efficiency of small businesses, since they are able not only to quickly fill niches emerging in the consumer sphere, but also to pay for themselves relatively quickly.
Small enterprises have a fairly prominent position in providing employment, producing certain categories of goods, carrying out research, scientific, production and applied developments, as well as their implementation in economic practice.
For Russia, it remains relevant to continue the implementation of state policy aimed at expanding and developing enterprises in the field of small business in the economy of our country.
Socially, small business, being an integral part of the country’s socio-economic system, draws a significant part of citizens into the sphere of small business by opening their own business, ensuring sufficient production efficiency through specialization and cooperation of production. Accordingly, the development of small business is one of the main objectives of the economic policy of the Russian Federation.
Literature
- Federal Law of July 24, 2007 No. 209-FZ “On the development of small and medium-sized businesses in the Russian Federation” (as amended on July 26, 2017)
- Decree of the Government of the Russian Federation dated 04.04.2016 N 265 "On the maximum values of income received from business activities for each category of small and medium-sized businesses."
Small business is an integral part of large production. It makes it possible to more efficiently use local resources and waste from large enterprises, create new additional jobs, and redistribute production costs in a much shorter time. investment cycle, has become a reliable source of income Money to state extra-budgetary funds and budgets of all levels. It contributes to the formation of a middle class, which acts as a guarantor of political stability in modern society.
At the same time, its development in the country lags far behind the capabilities and needs of our economy. This process is difficult and slow, so small business development indicators still remain low.
The vast majority of small businesses operate today in the field of trade and public catering services. The number of small businesses in the real sector of the economy is minimal, and in the sphere of high-tech industries it is extremely insignificant. The development of small businesses in Russia is hampered by the presence of many unresolved problems related to the instability of general economic and legal conditions, difficulties in attracting investments and credit resources, the lack of coordination and unsystematic nature of the mechanism of state and municipal support, etc. This gives relevance to the scientific analysis of this issue.
Many small businesses lack external financing, with the main obstacle to obtaining a loan being the conditions imposed by banks. One of the problems hindering the development of small businesses, managers of many enterprises and individual entrepreneurs call the lack of credit and financial resources. The banking sector today is more interested in large projects with a quick payback, and the refinancing rate, despite the fact that it has decreased since 2006, remains unattractive for small businesses.
Many banks are overflowing with money and declare the possibility of lending to small businesses, but in practice this does not happen. Making available funds work to establish a small business is extremely difficult for the following reasons:
- - This is the lack of decent loan security for small businesses. It is known that small businesses were created as a result of the private initiative of citizens;
- - high cost of credit resources. In conditions when the real inflation rate is measured at a double-digit figure, production cannot withstand 25 - 30% per annum on credit resources. This interest rate is high even for established businesses (10 times higher than the European mortgage rate, which fluctuates around 2-3% per year);
- - collateral for a loan, which is currently repaid in accordance with the current legislative framework and the conditions for passing cases in arbitration courts are quite difficult.
However, despite the risks, small businesses should eventually become and are already becoming desirable clients for banks. They are one of the most disciplined borrowers.
Something else is alarming: Russian entrepreneurs are in no hurry to apply for borrowed money. Many of them complain not only about high interest rates, even for small amounts, plus difficulties with collateral. Entrepreneurs do not risk pledging personal property - cars and apartments - explaining this by the unpredictability of life.
Individual entrepreneurs who periodically take out loans also complain about difficulties. Their arguments are simple: a businessman in Russia can earn on average from 5 to 15% per annum in foreign currency, and interest rates on loans in foreign currency are not lower than 14 - 15% plus taxes and rent. In addition, loans in Russian banks issued on short term, for which it is difficult to do anything, you have to refinance.
Most entrepreneurs often get by with their own funds; it is profitable to take out a loan when there is a lot investment plans and opportunities. In addition, banks give money to enterprises that have a constant stable turnover, and this must be demonstrated. The bank needs good indicators, and small businesses are often forced to hide income, and for this reason the bank is in no hurry to provide a loan. Numerous taxes and duties often leave entrepreneurs with 5-10% of profits. As a result, small enterprises are on the brink of bankruptcy, regardless of their national economic significance.
The next problem is the imperfection of the regulatory framework, and as a result, “paperwork” associated with both the registration of a new enterprise and the provision of reporting. Numerous checks and problems of coordination with all government authorities require a lot of money and time from entrepreneurs. As a result, the resulting product is “golden” at cost. For comparison, if in 2006 “non-production costs” of businessmen amounted to 8.8% among other expenses, now it is 9.6%, and 70% of this amount is bribes.
The greatest negative impact on small businesses in Russia in the coming year was the increase in insurance premiums to 34% (for some categories of enterprises - up to 26%). An increase in insurance premiums can lead to a several-fold increase in the load on the wage fund at enterprises with a higher share of wages in the cost structure, primarily at enterprises in more “advanced” technological industries - and, as a consequence, to the departure of many enterprises from the market. In addition, the proposed tax reform implies the emergence of additional control bodies - extra-budgetary funds. These bodies will be empowered tax authorities: carrying out inspections, suspending transactions on bank accounts, extrajudicial collection of payments and a number of others. In addition to tax inspectorates, the right to inspect enterprises will be given to the bodies of the Russian Pension Fund, the Social Insurance Fund and federal and territorial health insurance funds, which looks extremely contradictory in the context of repeated statements about the need to limit interference in business activities. Against the backdrop of statements about the need to reduce the number of regulatory agencies, a reform is proposed to increase their number several times.
The next problem is administrative barriers, the number of which is gradually decreasing, but their system remains unstable and therefore takes a lot of effort and time (a third of entrepreneurs still assess the level of administrative barriers as quite high). Example: it takes up to 1.5 months to organize a visit by a representative of the SES to obtain approval for the creation of production in the Moscow region. Moreover, this is provided that you yourself have already prepared all the necessary draft documents, and there are dozens of similar regulatory organizations.
A lot of dissatisfaction is expressed when assessing customs procedures. The negative assessment of tax authorities is decreasing. A third of entrepreneurs still suffer from inspections by sanitary and fire services. It is interesting that business in the regions more often suffers from law enforcement agencies than from criminal structures.
The costs of overcoming administrative barriers often exceed many of the costs associated with the company's activities. As an example, we can cite one small Moscow enterprise that has been operating for ten years. In order to store all accounting archives, an area of at least twenty square meters is required, and since the minimum rent is at least $200-300 per square meter office premises per year, then the costs will respectively be from 4 to 6 thousand dollars per year. It is not possible to store this data in electronic form.
On the other hand, entrepreneurs admit that the share of bribes in company revenue has now decreased significantly and does not exceed 5%, this is a significant reduction: in 2007 the figure was 9.6%. Most often, you have to pay bribes to gain access to government orders, during inspections, allotment of land, obtaining government support, connecting to infrastructure and obtaining certificates and licenses.
Also one of the problems is insufficient training of managers. A significant part of new small enterprises are created by people who have no experience in running their own business or who have changed its direction, for example, from trade to production. Often this reason leads enterprises to ruin due to the lack of even a general, at the level of popular science publications, understanding of accounting and management accounting. In addition, the labor market is not able to satisfy companies' needs for either qualified engineers or skilled workers. More than half of managers say that they will find technical specialists either difficult or practically impossible. And the number of companies experiencing difficulties recruiting staff is increasing.
Often an obstacle to the development of MPs is the lack of necessary infrastructure, for example in cities and urban areas with block development in the 60-80s. there are very few acceptable premises for catering or small production outside the buildings of former supermarkets and shopping centers. MPs are unable, even partially, to master the thousand-meter workshops of closed factories, and there are no small industrial warehouses. At the same time, in 2008 there were difficulties in selecting production premises 37% of companies experienced it, now 33% - the situation, despite the efforts of the authorities, remains almost unchanged. The same applies to land plots. Previously, 40% of entrepreneurs negatively assessed the possibility of obtaining land; now it is 39%.
Also, very often small enterprises are created on the basis of old state enterprises. For example, in Moscow, 60% of cooperative cafes have been transformed into state-owned catering enterprises. As a result, the number of cafes did not increase, and prices rose quite high. This form of cooperation does not lead to a weakening of the state monopoly, but to new forms of its manifestation. State research and design institutions are monopolists in their field. Employees of these organizations, having united into enterprises, decide for themselves what orders to place and how state enterprise, and which ones as a company, at higher prices.
Investing in a small business is always difficult. Local authorities are not at all concerned about reducing the level of contributions from small businesses to local budgets. The authorities do not want to link the prospects for the development of their own region with small businesses. They are not always interested in the development of knowledge-intensive industries, since they do not bring direct benefits to the regions. Local authorities are more willing to register enterprises that contribute to the improvement of the area. No matter how much the state supports its development, no matter what programs are adopted, structures that have funds are more likely to invest them in market leaders. By the way, the criminalization of small businesses is partly due to the lack of interest in small businesses on the part of serious investors.
For a small business to prosper, it needs to reach out to the public Russian market, which is very difficult in our country. These difficulties are often due to the fact that companies with small working capital, are often unable to sell products with deferred payment, which, with growing competition, is almost a mandatory requirement for a newcomer to the market.
In cases where rent of retail space and payment for display are required (in a large store the supplier pays for the quality of the place where the goods are displayed), the funds of small businesses usually do not last long.
The distribution of small enterprises across regions of the country remains unsatisfactory. More than half is concentrated in 8 constituent entities of the Russian Federation, in particular Moscow and St. Petersburg account for one third of all registered small enterprises. They are mainly engaged in trade and catering. Hence, the problem of raising small businesses is very important for small and medium-sized cities in Russia, which objectively need state support for its revival and development.
Government subsidies to large, especially unprofitable enterprises, not only do not improve their financial condition, but are also a prerequisite for the manifestation of dependency, the curtailment of initiatives, and reflect the unprofessionalism of managers. As a result, with an increase in government investment in large enterprises the volume of real gross product is falling, which indicates the ineffectiveness of the approach to economic management, and the share of small enterprises' products in the volume of gross domestic product is increasing mainly due to their own investments.
Next, it is important to note the problem of limited sales of products due to the existence in Russia of low effective demand of the population. Almost all production of domestic enterprises is narrowly focused, the demand for products is low, and competition from imports is becoming increasingly fierce every year. In the meantime, the Russian consumer goods market satisfies the needs of customers largely through imports. Therefore, the key problem of import substitution is to update technological processes, that is, in the implementation of innovations that improve the quality of products while ensuring resource conservation.
Another problem is the difficulty of obtaining information about the business environment. Most often, obtain information about a potential competitor or business partner, very difficult or often impossible. In Russia there are no special publications that would publish annually or quarterly financial statements namely small and medium-sized businesses.
The rate of innovation activity of small enterprises is extremely low. This is largely due to the inertia of a number of large and medium-sized enterprises in implementing innovations, which leaves its mark on innovative activity small businesses themselves.
Small businesses are extremely mobile, and therefore are constantly interested in accumulating advanced technologies, but, unfortunately, they do not have a solid laboratory and research base and scientific personnel for this, and the costs of purchasing new technologies are often prohibitive. In this case, innovative firms or associations uniting small businesses could become intermediaries in their transfer. To a certain extent, small businesses can provide investment support for research and development aimed at creating new technologies that will help increase the production of import-substituting products.
An acute problem remains the limitation of the ability to connect to utilities, primarily to sources of electricity. This applies primarily to the high cost of obtaining permission to connect or use additional capacity. Reducing the cost of connecting to networks for small business enterprises has eased the financial burden on small entrepreneurs. However, the problem of obtaining approval of technical conditions for connecting to networks remains.
As we see, there are a huge number of problems and obstacles to the development of small businesses in our country, and this is obvious. But let’s try to figure out further how to solve the above problems, whether small businesses in Russia have development prospects and what they are.
In Russia in recent years, one of the most pressing problems is the activation of small businesses, which attracts the attention of both academic analysts and ordinary citizens. Small business is the leading sector of the economy, which determines the structure of GNP, as well as the rate of economic growth. Big number business organizations operating in the economic environment is a necessary factor efficient work market. Creating favorable conditions for creating small businesses and its development gives the population the opportunity to receive income and the state - taxes.
IN economic economy Each country attaches special importance to entrepreneurship. This type of activity affects both overall economic growth and, to some extent, helps the state solve certain social problems.
Compared to large-scale production, the development of small business has a number of positive features: it structurally restructures the economy; provides additional jobs; quickly responds to changes in consumer demand; fairly quick return on costs; freedom of choice in the market. Small business helps to avoid territorial monopoly, increase competition and increase market saturation with goods and services. This type of business has great employment opportunities, and also has the opportunity to involve “work reserves” that cannot be used large species business due to its characteristics. These are disabled people, students, schoolchildren, pensioners who can work after their main occupations to earn additional income.
All this makes small business an important component in the development of the economy of any state. In Russia, this sector of the economy still experiences quite a lot of difficulties and problems. As the President of the Russian Federation noted at the Meeting of the State Council on the Development of Small and Medium Businesses on April 7, 2015, small and medium business is still developing slowly. Its contribution to the country's GDP does not exceed 21 percent, while in other countries with developed economies the share is 50 percent or more.
Small business is highly dependent on external environment and has a number of factors of a general economic and organizational nature that hinder its development.
Firstly, to open your own business you need start-up capital Therefore, one of the most pressing problems is the problem of financing and lending. If we evaluate expert data, then only 30% of entrepreneurs who need a loan received it, and if we consider microloans, which are given in the amount of up to 300 thousand rubles, then only 10% are approved. However, even if the loan was obtained, the entrepreneur constantly feels indebted to the bank due to high interest rates. But today we can talk about the advantages that occur as the small business lending sector develops. Banks, accumulating experience in this area, are already more accurately assessing the degree of risks and are trying to soften lending procedures, reducing interest rates and loan repayment terms.
Secondly, another problem that entrepreneurs still face is constant supervision by state regulatory authorities: trade inspection, labor inspection, tax office, police, standardization bodies, certification and metrology, licensing bodies, sanitary supervision and many others.
Table 1
Small business loan portfolio volume
|
Name of the bank |
Volume of loan portfolio for small businesses, million rubles. |
Growth rate for 07/01/2015-07/01/2016, % |
|
|
PJSC Sberbank |
|||
|
JSC Rosselkhozbank |
|||
|
VTB 24 (PJSC) |
|||
|
PJSC "MinBank" |
|||
|
PJSC "AK BARS" BANK |
|||
|
PJSC Tatfondbank |
|||
|
TKB BANK PJSC |
|||
|
OJSC CB "Center-invest" |
|||
Moreover, some of the fines that are imposed by these government agencies, are so large that they are beyond the capacity of the entrepreneur and have numerous negative consequences, including the closure of the enterprise itself. After all, it is almost impossible to avoid all the violations prescribed in the rules and regulations in real life. For now, the only way out of this situation can only be for the entrepreneur to know all his responsibilities and standards for conducting inspections by each of the government bodies.
Thirdly, the next problem, which also greatly limits the opportunities of entrepreneurs, is the high tax burden. Despite the fact that a simplified taxation system was introduced not so long ago, this did not make things any easier for entrepreneurs. Although the organization is exempt from a number of taxes, such as VAT, on profits and property, restrictions are also imposed: a ban on engaging in certain types of activities; restrictions on the number of employees; ban on opening branches. All this greatly reduces the opportunities for business expansion. Therefore, an increasing number of entrepreneurs are abandoning this type of activity.
Another obstacle standing in the way of providing assistance to small businesses is the lack of a unified infrastructure that would ensure the activities of these enterprises. At the moment, large enterprises have the opportunity to create their own infrastructure (centers, legal departments, etc.), but small enterprises cannot. Therefore, so that they can compete with larger organizations and not fall into difficult situations, the manager of a small business should have the opportunity to consult with a qualified lawyer, carry out various research in the field of economics and business, and also sell his goods through a general distribution network. There is a support infrastructure for this, which available conditions helps entrepreneurs on various issues of interest to them. However, the activities of this organization practically do not bring profit, therefore, in order to provide competent, qualified assistance, it needs government support, as well as the support of regional and local authorities. Therefore, another task can be identified - the creation of a unified infrastructure to support small businesses in the region and locally. A feature of this type of entrepreneurship is that it requires an infrastructure aimed at supporting it (Fig. 1).
Figure 1. Scheme of the functioning of the small business support system.
Another problem facing small businesses is the lack of qualified personnel. In a competitive environment, specialists with a high level of knowledge are acquired by large companies that can offer more profitable terms, in the form of higher salaries and social packages. Since all organizations operate in a dynamic environment in which information changes quite often, the entrepreneur himself needs to monitor changes in his work area and be able to competently organize the work process. To do this, it is necessary to improve the skills of not only employees, but also your own. Therefore, this problem is relevant for all organizations. You can also increase the level of knowledge of your specialists by conducting trainings, consulting services, as well as distance learning.
The state, taking into account all aspects related to running a small business, has taken a number of measures to develop this type of entrepreneurship:
- in the field of control over the conduct of small businesses, a restriction has been established in terms of inspections for a period of 3 years, which is one of the most promising prospects. Those. introduced Single register inspections, which will be carried out every 3 years, and the plan will be posted on the Internet website;
- Reliefs have been introduced in the field of taxes. Starting from 2015-2020 “tax holidays” may be introduced for individual entrepreneurs, and in the period 2015-2018, by government decision, tax collection and accounting measures should not change;
- fines have also been reduced, which has a beneficial effect on entrepreneurs;
- creation on the basis of the MFC since 2016 of a unified consulting base for small and medium-sized enterprises.
For business development, in addition to government programs and services, there are other approaches in the form of seminars, forums, methodological programs, etc.
Even in the current conditions with reduced purchasing power and sanctions bans, there are opportunities to develop your business and realize your plans for the enterprise. It is necessary to implement export and import substitution programs, which will allow us to make forecasts for future business development.
However, despite the current conditions with Western countries, Russia has still improved its position in creating favorable conditions for doing business (Fig. 2), (Table 2).
table 2
Indicators of the degree of favorable conditions for doing business
In many ways, it is government policy that influences the activities of small and medium-sized enterprises. An important step state in the field of supporting small enterprises is the adoption of the “Long-term strategy for the development of small and medium-sized businesses in Russia until 2030”. This program is aimed at ensuring transparency of market relations, including the conduct of business itself, reducing the barriers facing entrepreneurs, and ensuring stable rules of the “market game”.
According to the plan, the implementation of this strategy will take place in three stages. Also created Federal Corporation to support small and medium-sized businesses. The activities of this organization will be aimed at supporting this type of business, including in the field of investment. Another step forward is the introduction of bans on increasing taxes and contribution rates until 2018. Work is underway to create a unified infrastructure to help entrepreneurs.
Although the Russian economy is now in a difficult situation, there are great prospects for overcoming this situation. And only time will tell us how effective government measures to support small and medium-sized businesses will be in ensuring both quantitative and qualitative growth of this type of business for implementation in the economic space.
Bibliography:
- Volkova I. A., Popova A. Yu. Modern problems of small and medium-sized businesses in Russia // Concept. – 2016. – Special issue No. 04. – ART76051. –0.6p. l.–URL: http://e-koncept.ru/2016/76051.htm. –ISSN2304-120X (accessed 12/4/16)
- Korolyuk E. V. Rating analysis of business conditions in Russia // Scientific and methodological electronic journal"Concept". – 2016. – T. 15. – P. 1451–1455. – URL: http://e-koncept.ru/2016/96208.htm. (date of access 4.12.16)
- Official website of the President of Russia. Meeting of the State Council on the development of small and medium-sized businesses. April 7, 2015 -URL: http://www.kremlin.ru/events/president/news/49214. (date of access 4.12.16)
- Rating agency RAEX (Expert RA): Official website [Electronic resource]. Access mode: http://static2.banki.ru/ugc/ad/ad/0e/0e/Kreditovanie_malogo_i_srednego_biznesa_v_Rossii.pdf. (date of access 4.12.16)
Respondents ranked problems with access to sales markets in fourth position, followed by “searching for suppliers of goods and services,” “access to production and training technologies,” and “infrastructure.”
“Unrealistically” high costs
By commenting on free form, many entrepreneurs also noted high costs (“unrealistically high cost of connecting to power grids,” “increased electricity tariffs”).
This is not an exhaustive list of business challenges. High taxes and their increases were also mentioned (“Incredibly large contributions for employees!!!,” wrote one of the entrepreneurs), competition from shadow businesses, and the spread of federal retail chains, “the relationship of entrepreneurship with administrative resources”, low awareness of business about support programs.
“The overall conclusion is that the challenges for business as a whole are not changing. Over time, their priority changes,” says Alexey Nazarov, director of the strategic and operational consulting group at KPMG Russia. If earlier the emphasis was on the business climate, he explains, then during the crisis financial resources came out in first place, and the business climate moved into second place.
The favorability score was calculated by summing the average ratings across all issue categories for each region. Accordingly, the higher this indicator, the more problems there are in the region, from the point of view of those surveyed.
According to the survey results, the most favorable regions for doing business were the Republic of Adygea, Voronezh Region and Chukotka Administrative District. The Magadan Region, the Republic of Buryatia and the Kursk Region were at the bottom of the ranking of subjects of the Russian Federation.
The authorities are aware of the problems of entrepreneurs: in April 2015, President Vladimir Putin ordered the development of a strategy to support small and medium-sized businesses. The final project must be presented by the Ministry of Economic Development before October 1, a representative of the Ministry of Energy previously told RBC. The details of the program will be discussed, but RBC will review the latest version of the document.
The system of measures aimed at supporting small and medium-sized businesses, in particular, includes affordable financing (stimulating bank lending, developing a system of guarantees), predictable fiscal policy (including mitigating the fiscal burden on business), qualified personnel, creating new market niches (including including demand stimulation).
Introduction
2.1 Benefits of small business
2.2 Disadvantages of small business
3. The role of small business
4. Problems of small business
Conclusion
List of used literature
Introduction
Small business in market economy- the leading sector that determines the rate of economic growth, structure and quality of the gross national product. In many developed countries, small businesses account for 60-70% of GNP. But it's not just about quantitative indicators. This sector is inherently typical market and forms the basis of modern market infrastructure, because it primarily ensures a competitive environment for the economy.
Unfortunately, in Russia small business is at the initial stage of development. Despite the measures taken by the government to support small businesses, their activities are limited by a number of problems. Quantitative indicators are several times lower than the corresponding indicators in developed countries.
The purpose of the work is to understand what stands in the way of small business development, i.e. analysis of its problems and development prospects.
In accordance with the goal, it is necessary to solve a number of problems:
Define small business
Reveal its features
Determine the place of small business in the economy
Consider its evolution
Classify small business problems
Think through possible ways to solve these problems
It can be assumed that one of the factors in our country’s recovery from the crisis and building a market economy is the development and normal functioning of small businesses, which implies the relevance of this topic.
1. The concept of small business
The main factor in classifying an enterprise as small is the average composition of employees, but sometimes additional factors are used, such as sales volume, value of assets, etc. Small businesses in Russia are legally defined Federal law dated June 14, 1995 N 88-FZ "On state support for small businesses in the Russian Federation." The direction of the law is the implementation of the right of citizens to use their abilities and property to carry out entrepreneurial and other economic activities not prohibited by law.
According to the law, small businesses are understood as commercial organizations, in authorized capital which share of participation of the Russian Federation, constituent entities of the Russian Federation, public and religious organizations(associations), charitable and other foundations does not exceed 25 percent, the share owned by one or more legal entities that are not small businesses does not exceed 25 percent and in which average number employees for the reporting period does not exceed the following limit levels(small businesses):
in industry - 100 people;
in construction - 100 people;
on transport - 100 people;
V agriculture- 60 people;
in the scientific and technical field - 60 people;
V wholesale trade- 50 people;
V retail trade and consumer services - 30 people;
in other industries and when carrying out other types of activities - 50 people.
Small business entities also mean individuals those engaged in entrepreneurial activity without education legal entity. Small enterprises carrying out several types of activities (multi-industry) are classified as such according to the criteria of the type of activity whose share is the largest in the annual turnover or annual profit. The average number of employees of a small enterprise for the reporting period is determined taking into account all its employees, including those working under civil contracts and part-time, taking into account the actual time worked, as well as employees of representative offices, branches and other separate divisions of the specified legal entity.
The organizational and legal form of a small enterprise is established in accordance with Civil Code, as well as the laws "On joint stock companies ah", "On limited liability companies". They can exist in the form of individual (family) private enterprises, partnerships, joint-stock companies, production cooperatives, state (municipal) enterprises.
2. Economic characteristics of small businesses
Let's consider the main advantages and disadvantages of small businesses compared to large ones, and evaluate their role in the economy.
2.1 Benefits of small business
1. Relatively lower management costs due to the absence of unnecessary bureaucratic apparatus and, accordingly, high flexibility and efficiency of decisions in the management of small enterprises, which increases labor productivity (especially in micro-enterprises where the number of employees is less than 10 people). These conditions make it possible to quickly and flexibly respond to market changes, including by maneuvering capital when switching from one type of activity to another.
2. According to some scientists, large size increases the degree of formalization of the organization and reduces the ability to make organizational changes, so small businesses are more flexible and responsive in adopting and implementing decisions made, quickly adapt to changing conditions.
3. Lower capital requirements and ability to quickly introduce changes in products and production in response to local market demands
4. Small businesses know better the level of demand in local markets. The orientation of producers primarily towards the regional market is ideally suited for studying the wishes, preferences, customs, habits and other characteristics of the local market.
5. Relatively higher capital turnover of small enterprises.
6. Small businesses require less capital investment. They have shorter construction times, small sizes, it is faster and cheaper for them to re-equip and implement new technology and automation of production, to achieve an optimal combination of machine and manual labor.
7. Small business employees have a high level of motivation to achieve success, as well as the opportunity to realize their ideas and demonstrate their abilities.
8. Small business provides livelihood more people than large . It has significant potential in the field of employment of the population, involvement in production of labor reserves that cannot be used in large production due to its technological and other features. These are pensioners, students, housewives, disabled people, as well as people who want to work after regular working hours in order to receive additional legal income.
2.2 Disadvantages of small business
1. Compared to large enterprises, small enterprises have a higher level of risk, and, consequently, a high degree of instability in the market.
2. Small businesses are dependent on large companies.
3. Weak competence of managers and less professional workers.
4. Increased sensitivity to changes in business conditions.
5. Small businesses face great difficulties in attracting additional funds and obtaining loans.
6. SEs do not have market power and a good resource base
7. Despite increased flexibility, small businesses' ability to change is limited.
8. Small businesses have little propensity for investment activities due to insufficient capital and long-term returns on investments.
From the above characteristics we can conclude that small enterprises have significant competitive advantages and are capable of more effective activities than large enterprises in some areas of activity.
What can an effectively functioning small business give to the country's economy?
Small business can give the economy:
Necessary market saturation and mobility;
The trend towards price stability, increasing product quality due to price and non-price competition;
Accelerating the process of introducing new technologies;
An environment of competition that large monopolistic giants lack so much;
Deep specialization and cooperation;
The environment and spirit of entrepreneurship, without which a market economy is impossible.
Small business, quickly responding to changes in market conditions, gives the market economy the necessary flexibility. That is, small business creates such economic conditions without which high market efficiency is unthinkable. Finally, the creation of this sector of the economy is a positive alternative to underground business, eliminating its monopoly position in the market by improving the legal conditions for the activities of legally operating small enterprises. It is obvious that any country needs developed small business, so it is necessary to give freedom for the development of small businesses. For a country of the size of Russia, small business cannot become the basis of the economy; in our conditions, it can only become a connecting link that would ensure the uninterrupted operation of large industrial enterprises. But, nevertheless, in the conditions of transition from an administrative command economy to a normal market economy, the formation and development of small businesses is one of the main problems of economic policy. The formation of a competitive environment, facilitated by small businesses, is of paramount importance for our highly monopolized economy.