Thanks to SME Compass, a composite index that aims to assess the overall competitiveness of the Serbian small-and medium-sized enterprises (SME) sector, it is now possible to instantly determine the current dynamic ecosystem of SMEs, on whose progress a significant part of the entire Serbian economy depends.

On May 17, the USAID-funded Big Small Businesses Project, together with the Center for Advanced Economic Studies (CEVES) and with the support of the Chamber of Commerce and Industry of Serbia (CCIS),  presented the SME Compass, an innovative tool that unmistakably shows the condition and expectations of the SME sector in Serbia. This sector accounts for over 50 percent of Serbia’s exports and faces the most significant business challenges. Therefore, it is crucial to have a realistic assessment of the current situation and the main obstacles to harmonize better and focus on the support of all institutions and international development organizations. SME Compass helps SMEs gain timely insight into global trends that affect their business.  State, donor, and financial organizations can clearly see their structure and create support programs accordingly. That was the reason for launching this tool by the Project – to get data, information, and knowledge that will lead to better solutions.

The event brought together around 150 representatives of state and financial institutions, development agencies, donor projects, the media, and SMEs, who learned about the main business changes and expectations for the coming period. Important observations included: less investment by firms (especially in research and new product development) in response to current crises and uncertainty; mild dissatisfaction with the business environment, especially tax burdens; only 10% of companies plan green investments, and they see the accompanying regulations as a burden; and a noticeable increase in the employee wages (due to the lack of adequate labor on the market, the increase in the minimum wage and the increase in wages in the public sector), although the business situation of the companies worsened. However, what is encouraging is that the company’s expectations regarding the business situation and planned revenues in the next year are mainly positive.

The SME Compass Index shows the level of competitiveness and development of the SME sector according to nine key aspects of business, such as business expectations and results, business model, regulatory environment, skills development, digital transformation, green transition, etc. The results represent 11 sectors and 25 official districts of Serbia, which enables a deeper and more precise overview and understanding of the needs and performance of the SME sector. The index was created based on financial reports of over 40,000 companies in Serbia and research that included over 4,000 entities.