Development of small and medium-sized businesses in the construction industry through the use of business networks

Abstract

Practice shows that in all sectors of the economy there are network educations of entrepreneurs that contribute to improving the competitiveness of small businesses in various sectors of the economy. The network model of business organization is focused on a stable set of independent economic entities involved in the creation of goods and services based on contracts that facilitate the coordination of activities. The purpose of the work is to study the activities of small businesses in the construction industry and identify state mechanisms for its support through the functioning of business networks. The authors prove that the development of the construction industry is one of the most effective ways of economic growth, and identify the main advantages of using business networks for small business development: providing resources, increasing labor productivity, and increasing opportunities for innovation. At the same time, the problems of functioning of business structures in the construction industry and the consequences of their activities in the shadow sector of the economy are shown. The scientific article reveals the role of small business in the construction industry as a driver of growth in the socio-economic development of the region, presents the stages of formation of business networks small business, identifies the main elements of the system of state support for small business within the organization of business networks.

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“…Construction industry development provides one of the most effective ways of economic growth and identifies the main advantages of using business networks to support small business success: providing resources, increasing labor productivity, and fostering opportunities for innovation [57].…”