Survey of Greek SMEs (July 2012)

Small and medium-sized enterprises (SMEs) are a vital component of the Greek business sector. However, knowledge of their structure and dynamics is limited.

This survey aims at filling part of that gap. In view of the lack of published data, this analysis is based mainly on data drawn from a sample of almost 1,000 enterprises.

Both the structure of our questionnaire and the construction of the business confidence indices were based on European Commission and OECD harmonized questionnaire standards, in order to: i) achieve maximum reliability and predictability of indices; and ii) enable comparability with confidence indices for the business sector as a whole in Greece (such as IOBE indices) and Europe (e.g., those of the EC).

This survey will be carried out each semester so as to form a clear picture of the SMEs’ course over time (as reflected in the business confidence index).

In this phase of the survey, a cross-section comparison of the indices offers some useful insights into the growth potential, as well as the inherent challenges faced by SMEs:

• Very small enterprises appear to be weakening and this business segment is contracting.
• The main problem for SMEs at present is their lack of access to credit, largely reflecting the substantial reduction in trade credit
• However, using an ordered probit model, we discern a subset of SMEs that remains healthy and oriented mainly to external markets and new products.

Accordingly, policy regarding SMEs needs to be structured around three core targets:

• Reducing operating costs
• Enhancing liquidity
• Enhancing sales