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Small business development in Ukraine

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Diploma Small business development in Ukraine

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Warsaw 2017





1.1. The characteristic of small business and its development in Ukraine. 8

1.2. Economic forms of the organization of SB.. 19

1.3. Formation and need of development of small business in Ukraine. 21



3.1 The factors influencing development of small business in Ukraine. 32

3.2 The review of the main tendencies and dynamics of development of small business in Ukraine. 34


4.1 Main problems of development of small business. 36

4.2 Prospects of development of small business. 39








SB - Small Business

GNP - Gross National Product

TACIS - Technical Assistance for the Commonwealth of Independent States

IFC - International Finance Corporation

GDP - Gross Domestic Product


Formation of market system of managing in Ukraine is connected with growth of enterprise activity in all spheres of economy. One of the perspective directions of creation of the competitive and market environment is development of small business. The understanding of a role of small business demands a fair idea of what place it takes in national economy and what his distinctive features.

The small enterprise is considered the most dynamic element in structure of economic activity. Small enterprises have many advantages which actively influence to economic and social transformations in the state. Narrow specialization on a certain segment of commodity market and services, an opportunity to begin own business with rather small starting capital, lack of administrative hierarchies – all these lines of small business are his advantages that increasing stability in domestic market, but under certain conditions become the shortcomings constraining his development. The sector of small business is the integral, objectively necessary element of any developed economic system without which the economy and society in general can't normally exist and develop.

Process of formation and development of small business in Ukraine proceeds especially difficult and contradictory. Nevertheless, during radical economic restructurings small firms gradually take more and more important positions in system of national production.

Need of high-quality improvement of national economy, the most effective use of resources causes the need for determination of scales and the main directions of use of capacity of small firms.

Relevance of a subject of a research is defined not only because of existence of different thoughts concerning shortcomings, difficulties, mechanisms and the prospects of development of small business in Ukraine, but also because of a number of the latest realities in national economy in general, features of integration and investment processes. The appeal to the scientific subject covering problems of development of small business and its financial support when forming conditions of economic growth of the country is submitted very urgent today.

Significant scientific achievements have been done by Ukrainian scientists who greatly contributed to the development of small business in Ukraine. First of all, T.A. Hovorushko, E.P. Mylyavska, L.I. Vorotin, V.E. Vorotin, L.A. Martyniuk, T. Chernyak, N.A. Malysh and others.

In particular, Balanovskoe T.I., Hohulya O.P., Tuzhyk K.L. examine the role of the state in stimulating entrepreneurial activity, enterprise institute interaction with other structural elements of society.

Nemchenko A.B. sees the effective support of small business through the creation and operation of business incubators as part of the innovation infrastructure in the modern world.

N. Pivovarov believes that one of the factors of successful status of the small and middle business is infrastructure that ensures its effective functioning. Asanov G.E., Hanushchak L.M. and J.M. Kaszuba see small business development through formation of the innovation infrastructure in Ukraine.

Research objective is to analyze development of small business in Ukraine, to reveal the main problems of his functioning and to offer concrete solutions of these problems.

For achievement of a goal the solution of the following main objectives is supposed:

  • to study theoretical bases of a research of problems of small business;
  • to define the factors influencing development of small business in Ukraine;
  • to analyze dynamics of development of small business in the country;
  • to formulate the main problems and the prospects of small business in Ukraine;
  • to consider methods of support of small business from the state in the world and Ukraine.

In work also analyzed regulations, laws of Ukraine, the resolution of the government of Ukraine, decrees of the President of Ukraine. Statistical collections of the State Committee of statistics of Ukraine formed information base of a research.

During writing of thesis such methods of a research were used:

  • abstract and logical,
  • economical and statistical,
  • historical,
  • induction and deduction,
  • analysis and synthesis,
  • expert estimates.

The practical significance of operation is that the analysis of nature of development of small business which is carried out in a research in Ukraine significantly expands possibilities of implementation of a complex research of processes of increase in social and economic capacity of small enterprises in the modern conditions. The provisions which are contained in operation, generalizations, statements and outputs allow to analyze more deeply the modern potential of the Ukrainian small business and to develop ways of its optimization. Separate outputs and practical recommendations can be considered and used by the state institutes by development of comprehensive programs of support of small business.

The theoretical generalizations made in thesis about an entity, the place and a role of small business its peculiar features in the conditions of a transient period and the concept of the state support of its development can be used in teaching special courses on small business for students of higher education institutions and for professional development of principals of small business, the government and regional institutions on business support.


Meanwhile in the conditions of the market small enterprises experience the serious difficulties characteristic of small business in all countries, but in Ukraine considerably aggravated in the conditions of a transition period. Economic instability, crisis state of production branches, backwardness of infrastructure, pressure from larger competitors (including foreign), the complicated procedures of registration and licensing, crisis of non-payments and unfair behavior of the enterprises consumers, lack of internal incentives for long-term investments and development of technologies in the conditions of inflation, unequal situation in the market of credit and investment resources, a lack of administrative skills, criminalization of economy - all these factors rendered and make till present negative impact on development of small business in Ukraine.

In above the considered conditions the absolute and relative growth of small business against the background of the general decline in production and crisis state of many large enterprises, including exclusive, shows his high internal potential, an opportunity for enough general population to provide with own forces the economic independence and welfare.

In today's business environment complex structures of large enterprises (corporations, corporations) largely inferior to flexible and dynamic small enterprises, which instantly react to changing market conditions. However, small businesses lag behind their larger competitors in absolute terms, for example, the value of assets, sales, net income, so it is advisable to carry out a comparative analysis of tendencies of development tempo indicators to determine the level of business activity.

New problems and possibilities of optimization of small business are connected with influence of the global financial crisis now.

Universal financial and economic crisis couldn't but affect activity of small enterprises in Ukraine: in the conditions of crisis many small enterprises have been forced to reduce scales of the activity considerably.

So financial crisis in Ukraine has significantly affected availability of credit resources to small business, implementation of investment projects, and also consumer activity of the population that also negatively affects small business.

A number of experts, especially in the bank sphere, consider that in the conditions of crisis is necessary to support only effectively working small enterprises. However we will notice that in the conditions of crisis even effectively working enterprises can glitch. In modern Ukrainian conditions orientation only to effectively working small enterprises can finally disorganize sector of small business.

Additional measures for development of target crediting of the enterprises under calculations for the put production (factoring) are taken.

The state demand for production and services of the Ukrainian small enterprises will also be maintained through implementation of the planned investment projects.


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