The small and medium-sized enterprises (SMEs) in Ukraine continue to operate under significant strategic and tactical uncertainty, which accompanies the fourth year of full-scale war. Entrepreneurs are focused on optimizing costs and conserving resources as the economic situation remains unstable.
This is reported by Finway
Business Complexity and Market Challenges
According to the study by the European Bank for Reconstruction and Development, the perception of the complexity of running small and medium-sized businesses in Ukraine has changed little compared to previous years. In the fourth year of the war, the index for this indicator stands at 3.4 on a scale where 3 means “neither difficult nor easy.” In comparison, in the second year of the war, it was 3.5, and in the first year of the full-scale invasion, it was rated at 2.7, which was considered “difficult.”
“Intensified competition for consumers in conditions of economic instability has led to an increase in negative market phenomena, including the shadow economy and price dumping.”
The rise in competition amid economic difficulties has exacerbated negative phenomena in the market, such as the shadow economy and aggressive price dumping. Alongside this, businesses are forced to seek new approaches to maintain competitiveness.
Development Prospects and Staffing Challenges
Despite the challenges, 25% of representatives of small and medium-sized businesses managed to expand their teams in 2025. At the same time, more and more entrepreneurs plan to diversify or expand their activities, even if martial law remains in place for another year or more. However, prolonged uncertainty forces most companies to focus on saving and maintaining current stability, which negatively impacts investment activity in the sector.
Another acute challenge for small and medium-sized businesses remains the staffing crisis, which complicates development and adaptation processes. Entrepreneurs describe the current state of their operations as a struggle for survival in difficult conditions, with an emphasis on maintaining profitability and preserving workloads. Many companies are considering the possibility of reorienting to external markets, which are seen as more stable and predictable.