Predictors of Small Business Diversification

Abstract

The article discusses the features of diversification of small businesses, discloses its advantages for solving the problem of rationalizing activities. The factors of production and economic activity of the enterprise are considered, which are predictors of diversification and can be used in management as indicators. Diversification of the enterprise is one of the main ways of successful survival of business entities in the modern realities of competition. Nowadays, many organizations are successfully diversifying their activities, flexibly adapting to market conditions and increasing their financial well-being. The algorithm of the process of implementing the related diversification of the production activity of a small enterprise is given. The process of diversification of activities is highly costly, and for small enterprises, a related form of diversification aimed at expanding the range of products is promising. It is scientifically substantiated that this form of diversification is less risky, and requires the involvement of fewer resources of a small enterprise, at the same time, it provides an increase in the effectiveness of activities in a relatively short time interval.