Resumen
The main objective of the paper is to identify the sources of competitive advantage of small and medium-sized enterprises in Serbia. Gaining a competitive advantage is the key priority of market-oriented enterprises regardless of their size and sector. Since business environment in Serbia is not stimulating enough for enterprises? growth and development, the paper highlights the role of strategic orientation in business promotion and development. In order to identify the sources of competitive advantage, the empirical research is conducted by using the survey method. The research sample is created by using a selective approach, namely, the sample includes enterprises with more than ten employees, and enterprises identified to have the potential for growth and development. The research results indicate that small and medium-sized enterprises in Serbia are generally focused on costs as a source of competitive advantage, i.e., they gain competitive advantage in a selected market segment by offering low price and average quality products/services. In addition, the results of the research point out that the Serbian small and medium-sized enterprises are innovation-oriented. Organizations qualifying as middle-sized enterprises are predominantly focused on process innovations, while small businesses are primarily oriented towards product innovations. One of the limitations of the research refers to the small presence of the research sample within the category of middle-sized enterprises. The smaller sample presence than it was previously planned is mostly due to the lack of managers? willingness to participate in the research, as well as to the fact that these enterprises account for the smaller share in the total number of enterprises in the small-and medium-sized enterprises? sector. Taking into account that the sector of small and medium-sized enterprises generates around 30% of the country?s GDP, we consider the research results to be beneficial for both scientific and professional communities, as well as for economic policy makers in Serbia.