Development Trends of Estonian Small and Medium Sized Enterprises
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PRAXIS analyst
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Economic Policy Analyst, Praxis Center for Policy Studies
Praxis Center for Policy Studies has been conducting the studies of development trends of small and medium sized enterprises every third year since 2002.
The purpose of this, the fourth research was to ascertain the fields of activity of Estonian small and medium sized enterprises, analyse the factors influencing their development, collect the assessments of entrepreneurs, compare them by size, field of activity, location and current economic indicators, and compare the results with earlier studies. Nearly 1500 entrepreneurs were interviewed during the study. On the basis of the results it may be admitted that the factors influencing the development of small and medium sized enterprises are closely connected with the general trends and problems of economy. On the background of weakened financial environment, the number of such entrepreneurs who need additional financing for developing their enterprise, but for whom the possibilities of getting it are often beyond means is increasing. More and more hope is placed in state support. The situation of labour market has somewhat improved for the entrepreneur, but still it is hard to find top specialists. The reduction of demand during the economic crisis has also brought along the reduction of the number of exporting small and medium sized enterprises. But those who are exporting feel more confident and have managed to increase the percentage export turnover in their sales revenues. The readiness to start exporting goods and services in the nearest future is small, especially in the service sector. The attitude of entrepreneurs towards cooperation with other enterprises and investors who come outside the enterprise is problematic. The readiness for cooperation between enterprises is small; the will to preserve independence is brought out as the main obstacle. Cooperation is not seen as a possibility to develop one’s business and ensure the sustainability of enterprise.