Small Business Literature Review
The 21st century market globalization is perceived by economic experts as ushering a millennium challenge to emerging industries of world economies. The millennium challenge patterns the creation and establishment of small and medium enterprises that outlines the interdependence of domestic economies. This interdependence of domestic economies may seem to rationalize the inclusion of foreign-based enterprises and to the effect that they may be restrained from spatial use of economic domains.
Several studies reveal that the creation of Small-Medium Enterprises (SMEs) is in fact a millennium challenge to the foreign-based enterprises or foreign investors, perceiving the SMEs as their potentially direct competitor. One of the effects of competition could be the downsizing of the international supply chain, wherein international investments could be affected by the limited imports from raw material sources. On the contrary, the exporting countries could achieve domestic economic leverage in exportation of goods as raw materials.
Creating and establishing the SMEs throughout the world economies is a vision of hope for undeveloped and developing countries, emerging at the new age of competition. From which the restoration and rise of new economies may pattern the displacement of foreign competitors from the interstate commerce. However, the government in Saudi Arabia perceives that future demand for oil may decrease. The result of possible reduction in the production of oil could be translated into the slowing down of economy that may be brought about by a sudden downturn of the domestic labor market.
This downturn may impact the lower spending and purchasing of goods in a country where economic activities is in short supply of goods and financial disability due to inadequate employment and production capacity. The only way to map out national development is to create alternative route where the small and medium entrepreneurs can direct its way. The business ventures in developing the entrepreneurial potentials from the secondary source of economy are seen to be the direction to the future economic gains of Saudi Arabia.
The roadmap from where the small business sector will be routed through developing its capabilities and performance supportive of achieving domestic interdependence. From that vision, the creation and establishment of SMEs is a future endeavor that can objectively sustain the nationalization of economy, reflective of acquiring knowledge and skills of the present and future labor forces. This paper will specifically examine the factors of development of the SMEs from the perspectives of the small business entrepreneurs in Saudi Arabia.
Although the small business segment is still in the stage of infancy, there are several aspects that merit extensive discussion. The study will provide empirical evidence and other supporting details that will describe the roadmap of the small business sector. Methodology The breadth and depth of this study will review and examine various literatures, probing and proving the existentialities of the small-medium business entrepreneurs and the growth potentials of the Small Medium Enterprises in Saudi Arabia.
The study focuses on the scope of finding the deliverable means, processes and perspectives of the auxiliary industries pertaining to nationalization of secondary economies. This methodical finding will guide the overall discussions on available literatures and revalidation from several governmental and non-governmental organizations. Problem Statement, Vision and Objectives Saudi Arabia is a major exporter of crude oil, natural gas, petrochemicals and other agricultural products which generates substantial revenue.
However, the continuing exportation of primary and secondary economic resources causes more disadvantages. In addition, the inadequate integration of system for knowledge and skills is being critically considered as a handicapped in the background to propel the secondary source of local economy. Thus, resolving the problem is to visualize the creation of an economic sector envisioned to build the entrepreneurial capabilities.
The primary objective of this portion of the paper is to probe and prove how the conceptual model of Small-Medium Enterprises (SMEs) can transform an entrepreneurial economic sector, and specifically focuses on how the transformation process shall evolve. Literature Review This section of the paper will generally discuss and review the literatures relating to the situational development and aspectual components on the role of the business sector in the economy, and specifically the business and policy environment that outlines the overall condition of the small-medium entrepreneurs.
As an overview, it may be deducted that there are two segments that evolve in the catalytic role of small business entrepreneurs, such as (1) the entrepreneurial potentials, and (2) the competitiveness. However, the identification of problem areas need be complemented with the details that addresses the status of the small business sector, such as to describe (1) the characteristic, (2) the capabilities and skills, and (3) the engagement of processes for sustainable development, and (4) the role, services and requirements of the government and other stakeholders in dealing with the business sector.