The smallest companies are most afraid of rising costs and higher social security contributions (ZUS) in Poland.
The rising costs of running a business are currently the biggest fear of micro and small businesses, as reported by nearly 37% of them. Just under 30% are concerned about higher social security contributions (ZUS), and over 27% are worried about unreliable customers. The top-five list of risks also includes the loss of financial liquidity and the rise of taxes and other levies. However, the least concern is invoked by political instability, a fact reinforced by the observation that only 2.5% of those surveyed said they were not afraid of anything.
From the latest report entitled “Fears and worries of micro and small enterprises in Poland”, we know what these businesses are most afraid of. 36.7% of respondents, out of 617 representatives of companies that had 50 or fewer employees on the day of the survey and did not exceed 10 million euros in turnover or total annual balance, indicated overall rising costs.
“The year 2024 saw the highest ever labor cost increases. The reason for this is, among other things, the minimum wage doubling, which pushed salaries upwards in the economy, it is hard to find entrepreneurs who have not felt this. Moreover, the greatest ever increase in energy costs occurred. We already have the most expensive electricity in Europe. Even if a company locked in a long-term contract, these changes have affected it to some extent. The accumulation of these two elements makes the prime fear not surprising to me, especially as forecasts indicate further rises in labor and electricity costs, albeit at a slower rate,” comments economist Marek Zuber from the WSB Academy.
Grzegorz Kostrzewa, a co-author of the report from the restructuring law firm ProPrawni, emphasizes that costs directly impact the profitability and financial stability of companies, especially smaller ones with limited resources. According to the expert, anyone who runs a business is aware that the costs of energy, raw materials and wages can increase violently and are difficult to predict and control.
Rising operational costs are a severe problem for the smallest enterprises as larger ones can deal more effectively with this issue due to economies of scale. That is why some countries support micro-enterprises, such as in France where aid covers vanishing professions, including shoemakers, watchmakers and tailors. The aim is to ensure the smallest entities can survive.
The survey places the rise in social security contributions (ZUS) in the second position of micro and small businesses’ fears – at 29.5%, followed by unreliable customers – 27.2%. The fourth position in the ranking of fears is occupied by the loss of financial liquidity – at 20.5%. In fifth place is the increase in taxes and levies at 18.1%.
From the prepared list of fears, entrepreneurs rarely chose the response about political instability – 1.2%. Higher in the ranking are contacts with banks or leasing companies – 3.9%, war on Polish territory – 4.9%, and reporting bureaucracy – 9.3%.
According to the report, only 2.5% of respondents are not afraid of anything. On the other hand, 4.1% of respondents said they were afraid of something not included in the report, and 2.3% were unable to decide on the matter.
Professor Elżbieta Mączyńska concludes, “It’s an odd situation that an entrepreneur does not fear anything. This means he or she does not fear competition or any extraordinary events. However, every business carries some risk, including financial liquidity loss, market failure, or bankruptcy. Consider the recent flood. Can you find an entrepreneur in the flooded areas who did not suffer? If someone is not afraid, perhaps they have massive financial backing or are willing to subsidize the business.”
Source: https://managerplus.pl/obawy-mikro-i-malych-firm-na-czele-rosnace-koszty-i-skladki-zus-53380
