The total revenues of companies in Romania have increased 6.5 times in the last 15 years, from RON 400 billion in 2008 to over RON 2,600 billion in 2023, according to the "Entrepreneur Profile 2024" study carried out for ING Bank Romania by Datable and Impact Hub Bucharest, with the support of Startarium. The largest increase, of over 60%, was noted in the period 2021-2023.

However, the growth rate of the total net profit of Romanian companies was higher than that of revenues. Thus, the net profit reached RON 223 billion in 2023, 10 times higher than the value recorded at the end of 2008.

The research is based on data analysis at the territorial level to provide a clearer picture of the evolution of the entrepreneurial environment, especially in the second half of the last three decades, ING Bank Romania said.

In the same 15-year timespan, net profit in urban areas increased by 57%, significantly faster than in rural areas, where growth was only 39%. This gap, the study says, "highlights the difficulty of the rural environment in transforming revenues into net profit, having higher operating costs and lower efficiency than in urban areas."

Bucharest continues to concentrate the largest share of net profit, 37% of the total profits obtained by businesses in Romania. However, this share has decreased in recent years. In 2014, for example, stood at 45%.

In terms of revenues over the last 15 years, the average annual increase was RON 148 billion, and urban centers accounted for more than 60% of the companies' total revenues. Along with Bucharest and Ilfov, Argeș, Cluj, and Timiș counties stand out.

"The 'Entrepreneur Profile 2024' report shows that, despite the challenges, Romanian entrepreneurs demonstrate remarkable resilience and significant growth potential. International expansion, growing the customer base, and adopting advanced technologies are considered key priorities," said Vlad Craioveanu, CEO & co-founder of Impact Hub Bucharest.

When looking at the number of companies, the study found that only a few percent of businesses were located in rural areas at the beginning of the 90s, while today, the share increased to 32%. The urban environment continues to dominate the entrepreneurial landscape, with 68% of businesses in cities and towns, of which almost 19% are in Bucharest alone.

In the Bucharest-Ilfov area, in Cluj, in Timiș, and in other urban centers in the west of the country, there is a density of over 100 companies and freelancers per 1,000 inhabitants. The lowest levels are recorded in rural regions in certain areas of Moldova and Muntenia, where between 11 and 31 firms per thousand inhabitants are registered.

According to the same study, between 1990 and 2024, the business environment in Romania went through many changes, reflecting the adaptation to the market economy.

"After an explosion of new firms in the 90s, we saw a decline, followed by a strong recovery after 2000, with peaks in 2007 and 2017. During the global financial crisis, felt in Romania between 2008 and 2010, most of the newly established firms did not survive," reads the press release.

Out of the total of over 80,000 companies established in 1990, only 16,000, or 20% of the total, are still active in 2024.

The average lifetime of a company in Romania is almost 11 years, while over 50% of them are at least 8 years old.

In Romania, there are currently over 1.67 million companies and individuals carrying out freelancing activities (through forms of legal organization such as PFA - authorized natural person, II - individual enterprises, or IF - family enterprises). Their number is 58% higher than at the end of 2009, according to data from the Trade Register.

irina.marica@romania-insider.com

(Photo source: Natanael Alfredo Nemanita Ginting/Dreamstime.com)