THEORETICAL AND METHODOLOGICAL FOUNDATIONS OF SMALL BUSINESS IN UKRAINE

Abstract

The article is devoted to the research of theoretical and methodological foundations of small business in Ukraine. Small business is an integral structural segment of the market environment, a prerequisite for creating a market economy. The article deals with the main functions of small business - economic, social and environmental, as well as the principles of functioning of small businesses in Ukraine according to Article 44 of the Economic Code of Ukraine. The criteria by which an enterprise can be classified as a small business entity are outlined. Most small businesses in Ukraine are privately owned, which is why the owner has control and flexibility over the business and takes on all management responsibilities. However, the success of a business depends not only on its owner, but also on external factors that directly affect the business. The paper examines the environment of small business in Ukraine and identifies the main problems faced by small business, namely: negative state of the Ukrainian economy, monopolization of business, pressure from large corporations, problems related to bank loans, low competition in the domestic market, imperfection of the tax system, high level of corruption, limited possibilities for protection against unlawful encroachments, etc. Forming an effective business requires certain conditions, among which the key are economic, social and legal. Economic conditions are first and foremost the supply of and demand for goods, the consumer and purchasing power of the population. Social conditions determine the individual where the work is, which in turn influences his / her attitude to the value of wages to the working conditions offered by the business. Legal conditions are, first and foremost, the existence of laws governing business activities that create the most favorable conditions for its development. According to the results of the research, it is determined that small business in Ukraine is developing at an insufficient rate, which indicates the presence of unfulfilled potential. This paper outlines the role of small business for the Ukrainian economy and suggests ways to support and regulate small business. Keywords : small business, small business operation, small business, small business functions, small business operation principles.