Political Instability, Econ Crisis Slashed Turnovers, Profit Of Over 50% Of Romanian SMEs - Poll

The study presented Friday in a press conference was conducted early November and was based on 228 valid questionnaires.

Thus, 58.8% of respondents said they expect this year's revenues from sales to go below last year's, 17.1% said this year's turnovers exceed last year's and 9.7% of them count on constant financial results.

Most companies reporting lower turnovers operate the trade sector, with 71% of them reporting lower sales. Moreover, 69% of SMEs operating the industry sector reported lower turnovers in 2009, while 65% of companies operating the constructions sector were affected by the aforementioned factors.

Most companies registering lower sales, namely 27.6% of respondents, reported a decrease of 25-30%, 15.6% of them reported decreases below 25%, 5.1% of them reported decreases above 50%, while over 50% of questioned enterprisers could not give exact estimates of the downward trend.

As regards the increase in turnovers, 38.4% of respondents said this year's financial results are better than last year's, with an increase below 25%, 15.5% of them reported an increase of 25% to 30%, while 5.2% of them reported an increase of over 50%. Most companies reporting an increase in turnovers operate the sector of services.

Of total questioned companies, 66.7% estimate a decrease in profit in 2009, of which 41.7% expect a sharper decrease in profit and 17% estimate an increase in this year's profit, compared with 2008.

The political instability is seen by 55.3% of respondents as one of main factors affecting the activity of companies on the Romanian market, while the global economic crisis is seen by 44.3% of respondents as the main negative factor.

As regards the main problems companies are currently facing, 68.9% of respondents mentioned the delay in payments by clients or business partners, 52.6% mentioned the decrease in demand and 45.2% mentioned the evolution of the exchange rare.

Cutting administrative costs and reducing investments are the most important measures taken by enterprisers to cope with the economic crisis. Enterprisers said the best strategy in times of economic and political instability consists in keeping existing clients.

The study also indicates that nearly 50% of SMEs agree with having the minimum wage increased, while 38.6% of them oppose the idea. Over 50% of enterprisers rejected the idea of increasing the VAT but reducing the flat tax, or keeping VAT unchanged, but increasing the flat tax.

Of total polled companies, 45% operate the sector of services, 23.7% operate the industry sector, 12.3% operate the trade sector, 8.8% operate the constructions sector and 3.5% the farming sector. SMEs with ten to 249 employees accounted for over half of respondents, while microenterprises accounted for 36.4%.

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