This paper presents the difficulties of the formalization process of micro and small enterprises, addressing in context the problem of formalization and its counterpart, informality. This is followed by a theoretical development where the concepts and their implications for the economy are analyzed, and on these ideas show their importance for the economic development of the countries. A series of proposals will be made in order to improve formalization processes. A model will be proposed to help advisors, pro-entrepreneurship offices and key actors to understand how best to operate through a critical analysis of the measures promoted by governments to improve the process.