Logistics and socio-economic functions of small business

• -    economic - restructuring in the form of restructuring the structure of industrial production;

• -    marketing - saturation of the market with goods and services, as it is small enterprises that are able to respond quickly to changes in consumer demand and in a short time to establish production with this demand in mind;

• -    national - strengthening the economic base of local government bodies through a significant portion of small business profits to the budget;

• -    World outlook-methodological - the formation of new economic thinking associated with market relations;

• -    Personal - development of entrepreneurial initiative and innovative approaches;

• -    national - exemption of the state and large enterprises from low profit production;

• -    innovation - participation in innovative design and experimental implementation of innovations. In the United States, small enterprises account for more than half of the innovation process in the United States, and small enterprises employ 2.5 times as many innovators per job as large businesses;

• -    social - formation of the fundamental basis for sustainable social development - the "middle class"; - creation of new jobs, the cost of which is usually lower compared to large businesses; - involvement of additional labor resources (pensioners, minors, mothers with many children, the disabled, etc.) in the process of social reproduction;

• -    Socio-ideological - formation of entrepreneurial ideology in society; - environmental - improvement of the environmental situation.

Small enterprises produce in small batches and cause less harm to the environment than large ones. As a rule, they are subject to stricter control by the sanitary services. Even a brief enumeration of tasks that are solved with the help of small and medium businesses indicates its high socio-economic importance. Let us consider small business as a complex developing subsystem of the economic system as a whole. The development of its individual types affects the country's economy in different ways. They are able to conduct large-scale scientific and technical developments, which determine the most important technological shifts. On the other hand, there has been an unprecedented growth of small and medium-sized enterprises, especially in areas that do not yet require significant capital, large amounts of equipment and multiple collaborators. This is typical for high-tech industries as well as industries related to the production of consumer goods.

Small entrepreneurship complements big business and gives the economy as a whole stability and sustainability. In the economic literature of recent years, small and medium enterprises have been combined into such concepts as "small and medium entrepreneurship" and "small sector of economy" [3, 4]. The concept of "small entrepreneurship", in terms of international business terminology, has no analogues and is a purely domestic version of the term "small business". However, "small business" and "entrepreneurship" are related concepts but not equivalent. The owner of a small business, or the owner of a small firm managing his own business, is always an entrepreneur, but not every entrepreneurship is a small business. The areas of analysis of the economic essence of small business are quite diverse. At least, they are defined by two circumstances: first, small business objectively exists and develops as a certain integrity, a real sector of economy of national, regional and local scale; second, it is, as already mentioned, a special type of entrepreneurial activity.

Logistics methodology can be considered as a way to best meet the challenges of achieving efficient production to meet customer requirements.

Logistics implies a certain vision of production as a process of customer satisfaction. For this purpose, it is necessary to consider production: 1) as a set of interrelated and interacting processes transforming inputs into outputs; 2) as a process of resource management, which includes inventories, financial flows, human resources, as well as time resources; 3) all processes are subordinated to a single integrative objectives, which are carried out in the form of planning, implementation and control processes (Demining cycle); 4) the movement of material and financial resources is accompanied by information flows, based on which the process of planning, implementation and control is performed. Thus, logistics in the broad sense is understood as the science of material flow and information management from the supplier to the end consumer in order to minimize costs, designed to ensure the maximum possible satisfaction of consumer needs.

Let us move on to a more detailed consideration of social and economic functions and features of small businesses. The development of small businesses has encountered considerable resistance in the economic and social environment.

Obstacles to the development of small businesses, and therefore, small businesses, are among them:

• -    limited sources of funding and a constant shortage of capital. Small businesses rely on small loans from banks, their own savings, money from friends and relatives;

• -    a high level of risk in business activity due to a high dependence on the external environment, fluctuations in the economic situation, political situation, changes in legislation and so on;

• -    frequent under-utilization of fixed assets, difficulties with timely receipt of quality raw materials;

• -    dependence on large firms;

• -    dependence on the dictate of the market, in which the enterprise operates, due to the small scale of production;

• -    local resource and sales markets that do not allow the company to have any serious impact on prices and volume of goods sold;

• -    cautiousness of business partners when concluding contracts for supply of material resources;

Consequently, small enterprises can also improve production efficiency through the introduction of new equipment and production technology. Further miniaturization of machinery and equipment dramatically reduces the need for expensive production space. The use of artificial materials instead of traditional ones expands the material base of small enterprises and dramatically reduces the cost of materials processing. The development of vehicles, especially motor vehicles, dramatically increases the opportunities for small businesses to expand the market for product sales and raw material purchases. Media development and computerization facilitate access to data banks and contacts with suppliers and customers.

Results

Describing the economic essence of small and medium business as a special sector of national, regional and local economy and a special type of business activity, it can be concluded that quantitative factors associated with relatively small scale of production give rise to qualitative features of small and medium business. The level of development of small and medium-sized businesses largely determines the effectiveness of transformation processes taking place in our country's economy.