The Dependence of Perceived Business Risks on the Size of SMEs

Abstract

The issues of risk management in small and medium-sized enterprises (SMEs) have been analysed and discussed for a long time. Nevertheless, it is still necessary to concentrate on this field, especially in the Slovak Republic. SMEs are very sensitive to changes in the business environment which are always reflected in the quantitative characteristics of this sector in a certain time interval. According to various global surveys and studies, risk management represents a significant contribution to the increasing competitiveness of enterprises in changes of the business environment. The aim of this paper is to statistically assess the dependence of perceived key business risks of SMEs on their size in Slovakia based on own empirical research carried out in 2017. The contribution also includes an assessment of key risk sources and an evaluation of the survey results compared to the results of surveys taken last year. Based on the results, market, financial, economic and personnel risks comprise the four most important risks that negatively affect the business environment of SMEs. Dependence perceived by the SME entrepreneurs was found among market factors, personnel risks, and business size. No dependence was found among the financial, economic and business risks. The overall results of the empirical research point to the need and importance of addressing the assessment of key risks and their resources in SMEs in Slovakia. The goal of the paper is to highlight through a relevant study the need to apply risk management in the SMEs and to bring the results of the research in Slovakia closer to world trends.

Determining Probabilities for a Commercial Risk Model of Czech Exports to China with Respect to Cultural Differences and in Financial Management

“…The research has confirmed that unpreparedness for specific risks that may arise in China can have unfortunate economic consequences, this corresponding to the outcomes of a broader study by Hudakova et al (2018).…”

“…Corporate management's ability to work with risk is the subject of research in many countries. Recent study conducted by Hudakova et al (2018), for example, follows up on similar research carried out in the Czech Republic, Poland, Hungary and Serbia. A considerable number of risk management models generate a range of studies and manuals dealing with the issue; the following selection lists just a few examples -Alma (2017); Brillinger (2018); Dostál et al (2005); Fotr & Hnilica (2014); Korecký & Trkovský (2011); Valaskova et al (2018).…”

The attitudes of entrepreneurs of the small and medium-sized enterprises sector in Poland to key business risks

“…One of the reasons for this is, undoubtedly, the sensitivity of this type of enterprise to changes in the business environment. The research conducted by Hudakova et al (2018) shows that among enterprises in the SMEs sector in the Slovak Republic, market, financial, economic and personal risks are the main ones that affect negatively the business environment of small and medium-sized enterprises. The authors also indicate that to improve the level of risk management, it is necessary to increase theoretical knowledge about it among entrepreneurs, as well as to familiarize them with methods and tools that can be used in risk management processes.…”

Important factors which predict entrepreneur’s perception in business risk

“…If economic institutions contribute to the explanation of opportunity entrepreneurship, then it can be assumed that they may predict business risk. Thus, doing business in an unstable economic environment may lead the business to expose themselves to business risk (Hudakova, Masar, Luskova, & Patak, 2018;Martinez, Zouaghi, Marco, & Robinson, 2019). Scholars have shown that macroeconomic environment affects business performance leading to the failure of businesses (Karabag, 2019).…”