Small Businesses Sole Proprietorships

Question: Discuss about theSmall Businessesfor Sole Proprietorships. Answer: Introduction This assignment seeks to analyze the article related to the nature of small businesses, how they operate, current trends as well as the various challenges and barriers they face in the global markets. SMEs are described as privately owned corporations, partnerships or sole proprietorships with less than nine employees and have less annual revenue as compared to regular sized businesses or corporations (Thornton, 2011). Examples of small businesses are service or retail shops, convenience stores, restaurants, and small grocery stores. Challenges Facing Small Businesses Even though some small businesses manage to stand and move against all the odds, they are faced with several challenges, most of which lead to business failures and eventual collapse. Among these challenges are susceptibility to internal power wrangles, planning problems, cash-flow concerns, excessive regulatory barriers and the inability to evaluate the businesses. Businesses that are run by the family have many conflicts and large extents of friction between employees since employees find it easy to criticize and despise their bosses who happen to be their kin. They tend to be lazy since the business is theirs to run and there is less or no risk of being dismissed (Baker, 2011). Small businesses are left behind as far as succession planning is concerned. Very few of these businesses have formal succession plans. They also lack access to funding which is necessary for proper growth since it is difficult for them to access the various loan facilities and grants offered by financial lending institutions. It is also difficult for them to attract investors who can boost the businesses due to their small operation scales. SMEs struggle so much at the hands of regulatory authorities that they consider the best option is to close down rather than push through the challenges posed by regulations (Johnson, 2007). Apart from that, they have been found to shy away from processes that head towards the direction of global expansion. This is because they cannot manage to hire qualified professionals to train and take them through the strategies needed to excel in international markets. Research Problem The researcher has adequately formulated the research problem. The main here was to give us a brief overview of how small businesses, particularly in Europe and Russia, operate as well as the challenges they face. It has further discussed the number of small firms that have been opened, the parliamentary systems surrounding them and the influenced caused by bureaucratic systems on the life of the small businesses. The concept of the number of employed people without employees is also analyzed alongside the problems of corruption and unemployment. It has described that small businesses play a significant role in the economy and social life of people. Unemployment levels are rising alongside inflationary pressures. Regulatory and legislative procedures are mostly hindering many small businesses desire to expand and operate at higher levels. It has lastly described how corruption has established its roots and is, therefore, becoming a significant challenge for small businesses and shows how the economy of the corrupt nations is suffering. Objectives of the Study The researcher has clearly stated the objectives of the survey. The intention was to examine global issues surrounding small businesses in various countries. The questions about corruption, unemployment, legislative processes, and bureaucratic processes have been explained. The main problem here is to make readers understand the factors that can modify the life of small companies which translates to the conclusion that all the factors mentioned above should be thoroughly analyzed to forecast how the economy could change as well as the resolutions that can improve the lives of small businesses. The researcher has provided data that contains percentages, figures, references as well as graphs to adequately analyze the major topics of concern. This is in conformation to the scientific requirements. Small Businesses and Decentralization of Economic Power Decentralization is used in this case to denote the process of redistributing market operations of the businesses across various regions away from the central powers of one big business (Ezcurra, 2011). The researcher suggests that in a given urban area, there are a lot of goods and services that must be provided to consumers but leaving one large company to meet the demands will not be effective. There is a claim that if it happens that way, then it gives monopoly powers to the big businesses that raise prices and leads to exploitation of consumers. It is, therefore, wise enough to allow many companies to operate in that area which brings competition and thus leads to the right prices and quality of goods and services offered (Wales, 2011). Indices of Euro Stat It was noted that the number of closed small businesses decreased by 8533 companies in Spain from 2009 to 2012. 72740 fewer companies were closing down in the United Kingdom in 2012. In France, 20% fewer companies closed. Romania experienced a decrease of -84%. Latvia and Lithuania registered -52% and -76% decrease respectively. Implication It can be affirmed that the governments are working hard in their attempts to eliminate economic crisis. I can further learn that the fundamental aim of small businesses is to decrease unemployment or maintain it where it is. The disparity between the poor and the rich can also be reduced here when small businesses flourish. Conclusion The paper has adequately analyzed the concept of small business operations, factors surrounding them, the challenges facing them as well as the various strategies that can be helpful in improving the life of such firms that aim at reducing unemployment and poverty levels. References Baker, W. E., Sinkula, J. M. (2009). The complementary effects of market orientation and entrepreneurial orientation on profitability in small businesses. Journal of Small Business Management, 47(4), 443-464. Bates, T., Jackson, W. E., Johnson, J. H. (2007). Introduction: Advancing research on minority entrepreneurship. The Annals of the American Academy of Political and Social Science, 613, 10-17. Glenn Richey Jr, R., Haozhe Chen, Rahul Upreti, Stanley E. Fawcett, and Frank G. Adams. "The moderating role of barriers on the relationship between drivers to supply chain integration and firm performance." International Journal of Physical Distribution Logistics Management 39, no. 10 (2009): 826-840. Rodrguez-Pose, A., Ezcurra, R. (2011). Is fiscal decentralization harmful for economic growth? Evidence from the OECD countries. Journal of Economic Geography, 11(4), 619-643. Thornton, P. H., Ribeiro-Soriano, D., Urbano, D. (2011). Socio-cultural factors and entrepreneurial activity: An overview. International small business journal, 0266242610391930. Wales, W. J., Gupta, V. K., Mousa, F. T. (2011). Empirical research on entrepreneurial orientation: An assessment and suggestions for future research. International small business Journal, 0266242611418261.