Significance and development problems of SME's in contemporary market economy

Abstract

Small and medium enterprises (SMEs) represent the basis of economic development. Because of their characteristics, SMEs are far more flexible and responsive to frequent changes that occur in the contemporary global environment than large enterprises. This paper analyses significance of SMEs to the economies of EU and Serbia. The result is great significance due to the fact that more than 95% of all registered enterprises are SMEs. The paper also analyses the most frequent problems of SMEs in the EU and Serbian market. The results show that these problems are usually generic and that the most important ones are: lack of financial assets, small possibility of technology transfer, lack of capacity for permanent development of products and services, small possibility of internationalization of business operations, lack of quality management, inadequate administrative regulations, limited purchasing power, etc.