Russian SMEs growing on stronger supply-chains to giants

Large Russian companies are increasingly turning to small and medium-sized enterprises (SMEs) for software, technology products, and industrial components – a trend officials and business leaders say could help raise the sector’s relatively modest share of the national economy.

The strengthening of the SME sector’s role was discussed on Wednesday at the St. Petersburg International Economic Forum 2026 (SPIEF), where government officials, entrepreneurs, and business associations examined ways to accelerate growth amid high borrowing costs and tax changes.

Maria Glukhova, executive vice president of the Russian Union of Industrialists and Entrepreneurs (RSPP), said demand from corporate giants is creating new opportunities for smaller firms.

“Software procurement from SMEs has increased for a third of the surveyed companies,” Glukhova said, citing an RSPP survey of large Russian businesses.

According to the survey, around a quarter of respondents reported increasing purchases of technological solutions from SMEs, while a similar share said they were buying more components and equipment from smaller suppliers.

Glukhova attributed the trend to the greater flexibility of smaller companies.

“Large companies are not always as agile as small and medium-sized businesses,” she said, noting that SMEs are often better able to adapt products and services to customer needs.

Officials view stronger ties between large corporations and smaller suppliers as an important mechanism for expanding the SME sector’s economic footprint. Russia has around seven million SMEs and individual entrepreneurs employing roughly 19 million people, or nearly one-third of the workforce, Deputy Economic Development Minister Tatyana Ilyushnikova told the panel.

Despite their significant role in employment, SMEs account for only about a fifth of Russia’s GDP, according to Economic Development Ministry estimates. By comparison, small and medium-sized businesses generate roughly 43.5% of US GDP.

At the same time, Glukhova warned that many SMEs remain cautious about expanding operations despite growing demand from large customers. Smaller businesses are more sensitive than larger firms to rising prices, higher taxes, and financing costs, she said.

Participants at the forum argued that increasing procurement from SMEs, particularly in high-tech sectors, could help narrow the gap between the sector’s share of employment and its contribution to economic output.

This year’s SPIEF, being held from June 3 to June 6, is focused on economic growth, industrial development, technological sovereignty, and international cooperation, including with BRICS and Global South countries.