CRITICAL FACTORS FOR THE FAILURE OF SMALL METALWORKING COMPANIES IN BRAZIL

Abstract

Small companies contribute to the well-being of the place where they operate, as they generate jobs, introduce innovations and stimulate economic growth. The social function and economic importance of micro and small companies, as well as the vulnerabilities that cause their failure, are highlighted in this study. Based on research on the factors that contribute to the failure of small businesses in Brazil and abroad, this research aimed to investigate what are the factors linked to the failure of micro and small companies in the metal-mechanic sector located in the south of Brazil . For this, individual in-depth interviews were conducted and basic questionnaires were applied to specialists who have experience related to the financial, strategic, operational and marketing aspects of micro and small companies. The results indicate that the critical factors for the companies' failure are concentrated on issues such as weakness in the preparation and dissemination of their planning, financial imbalance, difficulties with product pricing and inventory control, and the lack of investment in marketing and innovation strategies. This study can contribute to minimize the lack of research related to the subject, in addition to providing an in-depth look at best practices in conducting micro and small businesses, helping to avoid the early closure of their activities.