Small Businesses in Spain and Italy need to stay alive

business initiative directions

For most small business in the world today, times are rough. Almost everybody prefers to shop at the big supermarkets and can’t tell the difference between a real piece of fruit vs. a genetically modified and preservative-sprayed one.

But there are some cultivators that are keeping afloat by promising the most natural products, a history of quality and tradition. Not to mention their local customers seem to know the benefits of health and taste when it comes to the most natural.

On today’s front page of the New York Times there’s a video-featured article about a family-run lemon grove on the Amalfi Coast of Italy called «This Business Is a Lemon, and a Family Wants to Keep It That Way».

The  interview is heart-warming as the 78-year-old lemon-cultivator talks with love about his entire life of working with lemons, nurturing the lemon plant as if it were in a cradle. He says that he probably has more lemon juice in his veigns than blood. He also says that by being lemon-keepers, we work for everyone on earth.

The interviewer also talks to his son, who states that being the next generation of a small family-business is a beautiful condemnation. On the one hand, there is no better business than a family one, but on the other hand, it is their responsibility to take it over because otherwise it will fall apart.

This article is particularly comforting as Spain and Italy are two of the worst-hit economies in Europe, especially when it comes to SMEs. Just last month, Reuters released an article called «Small businesses spell big problems for Italy and Spain.»

According to the article, SMEs make up the majority of the economies of Spain and Italy, and they’re struggling more and more as they’re being thrown into a more global economy and unified Europe. What’s more, Italy and Spain make up 28% of the Eurozone economy, so they’re debt problems have an undeniable effect on their European counterparts. Banks are stepping in and aiding SMEs with their loan problems, but it’s not enough.

We at Business Initiative Directions are located in Madrid, an increasingly cosmopolitan city. Over the years we have seen family-run storefronts shut down and turn into greater chains overnight. It’s the way it goes nowadays.

Most Spaniards do complain that it is too difficult to keep a small business alive due to overbearing tax-laws, fees and administration. In addition, becoming a freelancer in Spain is usually not an option as it requires some of the highest tax-fees in Europe — a 300€ flat rate per month, regardless of income, plus 21% VAT on all earnings.

It seems counter-productive to make it so difficut for people to start their own businesses or become self-employed, since times of recession call for entrepreneurship and innovation to get back on track. Needless to say, if Spain wants to keep its SMEs alive, it’s going to need to stop drowning them.