THE IMPACT OF MICRO AND SMALL BUSINESS MORTALITY ON THE MICROECONOMICS

ABSTRACT

This paper addresses the issue of “the main causes of mortality in micro and small businesses”. Its scientific relevance lies in the fact that this subject is still little discussed and the knowledge that is achieved is far from what actually happens. In this sense, this paper aims to clarify some points that are unclear in this area. Its social relevance lies in the fact that this research may help to understand the reasons that usually lead micro and small businesses to premature bankruptcy and thus guide other entrepreneurs to take due care when preparing their projects and opening new organizations. Micro and small businesses have intensified their position even in the absence of support proportional to their economic participation. Micro and small businesses, in general, are more versatile in terms of adaptability to internal professional markets. This is because their production, in terms of volume and operating costs, is much lower than that of a large company, which allows them to reduce the operating volume without significantly affecting the total profitability of their assets. Even so, it does not reduce the bankruptcy rates of micro and small businesses for a variety of reasons, from the lack of an effective management process to the lack of resources to maintain the business. This paper aims to present the reasons why small businesses die prematurely and some ways to avoid such situations. Micro and small businesses in Brazil correspond to the vast majority of Brazilian companies, and are responsible for a significant portion of the GDP – Gross Domestic Product. The general objective is to deepen theoretical and technical knowledge about small businesses, so that the main difficulties and problems faced, as well as the difficulties encountered by small and micro businesses and what they need to develop in order to be successful, can be identified. The specific objectives are to conduct a brief study about small businesses in order to identify and develop appropriate strategies to reduce their mortality.