INSTAT Survey Explains SMEs’ Innovation Capacity

TIRANA, October 18

Innovation is crucial to enhancing the competitiveness of small and medium-sized enterprises (SMEs). The lattes survey on innovation capacities of SMEs in Albania found out that innovation activity in enterprises results in disproportion with their size.
Findings from a survey on innovation in SMEs conducted by the Institute of Statistics (INSTAT) shed light upon important trends from the sector. Based on the survey that traced innovation trends and practices between 2016 and 2019, only 46.9 percent of SMEs were found to conduct innovative activities.

On average, 8.7 percent of the interviewed enterprises that carried out innovative activities in the period 2016-2018 were part of enterprise groups and 40.3 percent of them have headquarters abroad.
The most active innovators were found enterprises that provide software manufacturing, ICT services, informatics consulting services, software development, etc.

Moreover, the data show that the smaller the enterprise the more innovative activities they conducted. Hence, the percentage of enterprises with 0 to 9 employees engaged in innovation activity was 95.6 percent, for enterprises with 10 to 49 employees this percentage was 4.0percent and for enterprises with 50-249 employees was 0.4 percent.

“In terms of geographical market sales, 87.7 % of innovative enterprises sell their products (goods and services) in the national market, while 18.6 % of sales were in the regional market (Balkan-Mediterranean) – Bulgaria, Cyprus, Northern Macedonia, and Greece. At the same time, 20.9 % of the enterprises sell their products on the markets of other European Union and EFTA countries (Iceland, Norway, Liechtenstein, and Switzerland), while 7.1% on the markets of other countries,” the report highlights.

Another important finding shows that only 5.9 percent of enterprises that conducted innovative activities have received public funding during the survey period. The most common funding institution was the European Union with 84.7 percent.

Regarding the factors that prevent enterprises from performing innovation activities the survey ranks:
The high cost of innovation activity – 73.5 percent of enterprises
Market competition – 72.9 percent of enterprises

Source/Photo Credit: INSTAT