INNOVATION ACTIVITY OF SMALL SERVICE ENTERPRISES IN SAMARKAND, UZBEKISTAN: BARRIERS AND DIGITAL ADOPTION PATTERNS

Abstract

This study examines the innovation activity of small service enterprises in Samarkand, Uzbekistan, with a focus on digital adoption patterns and barriers to innovation. Despite national policies promoting digital transformation, the extent and nature of innovation at the micro-level remain underexplored. A survey of 15 small enterprises (cafés, beauty salons, photo studios, and IT service providers) was conducted in April 2025. Results indicate high adoption of marketing (93% use social media) and organizational innovations (87% use mobile payments), while product and technological innovations remain limited (only 33% introduced new services). The main barriers identified are financial constraints (67% of respondents), lack of digital skills (53%), and fear of implementation complexity (33%). The findings suggest that while low-cost digital tools are widely adopted, deeper technological integration requires targeted state support, including digital literacy programs and partial software subsidies. This research contributes to the growing literature on innovation in emerging economies and provides practical insights for policymakers in Central Asia.