Obsticles of Small Size Business Houses.
Every third small company has a problem with maintaining the market in the first years of its operation. The reason for the high failure rate of micro-enterprises may be problems with obtaining additional financing for necessary investments. In this way, the development of companies is inhibited, while their competitiveness and market position are also reduced.
Microfirms, i.e. those entities that employ from 1 to 9 employees, currently dominate the Polish market, because they constitute about 96 percent of all enterprises. They also have the highest GDP impact, on average around 30 percent. They are the most productive, cost-effective and profitable. Despite high potential, every third entrepreneur falls after the first year of operation.
New investments are necessary for the development of any company, eg the purchase of new software, electronic equipment or innovative technologies. Unfortunately, such investments very often require huge financial outlays. It often surpasses the capabilities of the smallest entities, just starting their activity on the market. In this way, many entrepreneurs are forced to close their businesses.
The Survey For Entrepreneurs
External financing can solve this problem. A survey conducted by Smartscope for Aasa Polska shows that most entrepreneurs are interested in obtaining additional funds, but do not have sufficient knowledge on this subject. In addition to the problem of finding the right source of money, entrepreneurs also have doubts about how to use the funds raised for the development of their own business.
Our research shows that the main goal for which entrepreneurs want to allocate these funds is to purchase additional equipment for the company. Every 4 entrepreneurs indicate that they would like to use these funds for development. Here, the most frequently indicated area is the extension of services offered or additional funds for the development of advertising and marketing. It is also worth mentioning 14 percent. respondents who declared that they would like to use additional financing to repay their current obligations or hire an additional team. – says Dominik Ciula from Aasa Polska.