Actual trends in business risks for small and medium enterprises. Case studies from the Czech Republic and Slovakia

Abstract

Small and Medium Enterprises (SMEs) play an important role in the national economy of any country. In their business activities these companies are confronted with number of business risks. Aim of this article is to define and compare current trends within business risks of SMEs in selected regions of the Czech Republic and Slovakia in the context of entrepreneurial optimism. In 2013, in the research on entrepreneurs’ opinions in Zlin region (Czech Republic) and Trencin region (Slovakia) have been investigated. These regions have similar economic parameters and are separated by just a few miles away. According to our research, it can be stated that during the period of financial crisis, situation in the SME business deteriorated significantly with declining performance and profitability of Czech and Slovak SMEs. The most important business risk is still market risk than financial and at last the personnel risk. Our research showed that the profitability and performance of SMEs decreased. Results of our research confirmed the deterioration of business environment where commercial banks responded by tighter credit conditions. Despite these facts, the level of entrepreneurial optimism of SME in the selected regions of Czech Republic and Slovakia is very high. On the basis of our research, it can be argued that entrepreneurs in Zlin region declared better conditions for their business compared to Trencin region. These entrepreneurs slightly less intensively were perceiving market and financial risk compared to entrepreneurs from Trencin region, and less intensively perceived impacts of the crisis on their financial performance, declared higher level of business optimism. © Economic Research Institute at the Bulgarian Academy of Sciences, 2014.