There is no doubt in the world today whether or not to support the founding and development of small and medium-sized companies. They have become an objective reality in all modern economies of the world. State, governmental institutions and non-governmental organizations in many developing countries completely support small-scale industry and entrepreneurship. Transitional countries are also trying to achieve a quick development of small and medium-sized companies. The results are significant but not sufficient, since the process of privatization and transition to the principles of marketeconomy are still incomplete. Innovations within the educational system that are beneficial for small-scale industry and entrepreneurship, the increase in numbers of entrepreneurs, as well as the significant support and specific help from the international community in relation to the development of entrepreneurship in the Republika Srpska, are positive and encourageing facts. In order to realize business enterprise when it comes to the development of small business, the modern practice has developed a business incubator system that enables the organization of own buisnesses with support from governmental organs, financial and educational institutions and donors. Incubators make it possible to start the work of several small businesses under one roof. Clusters are a new specific model for developing small and medium-sized companies.