When one talks of any business, more so a Micro Small Medium Enterprise aka MSME, the first thing that comes to mind is overcoming the challenge of generating capital to begin and sustain the business. The obsession with the same generally makes one overlook the other nuances that need equal attention – from adhering to regulatory compliances, skilled manpower, getting the right infrastructure in place, technology up -gradation and having a thorough and fool proof marketing and distribution set-up.
In wake of the plethora of challenges that MSMEs face, it is important to acknowledge the role of experts in the field that provide not just the much needed handholding to the business owners but also help them strategise their growth plan in wake of growing competition.
| India as a country accounts for the largest number of MSMEs globally and the sector accounts for close to 45% of the manufacturing output and approximately 40% of the total export of the country. |
Common Challenges are
Regulatory Compliances: A critical challenge to overcome is that of adhering to compliances set by the government. Overlooking these can cause bottleneck in smooth functioning of the MSME. Most often than not it is practically not possible for a business owner to keep tab of various compliances related to registration, taxes, GST, manufacturing rules etc. The role of an expert here cannot be understated as he comes equipped with required knowledge that can help the MSME take into consideration all the rules and laws required. One also should keep in mind that the government has taken strong initiatives to ensure the MSMEs are paid in time (within a period of 45 days) failing which the MSME can seek a penalty amount from the buyer. This is another area where awareness from an expert can help the MSME channelize their invoicing and payment collection to be done in time.
Finance: To take on the challenge of procuring capital for running a MSME, the entrepreneur either makes use of his savings or resorts to borrowing money from friends, family or local money lenders thus commonly known as approaching the informal channels. The Government of India has been taking keen initiatives to provide easy financing options to deserving MSMEs. Here with the help of an expert, one can find out about the ongoing government schemes that can be availed of.
Did you Know? The top incentives introduced by the RBI and the Government include |
Competition: The MSME sector is loaded with competition and to remain ahead in the game, it is imperative that the business owner is updated on where he stands. Keeping a tab on the same is often not possible and here is where a consultant / expert can help with various market research reports and also provide complete analysis on the areas of operation that need improvement/innovation.
Technology: Technology adoption has made in-roads across categories and MSME is no exception. The use of right technology can help aid manufacturing by reducing cost of production and generating a stronger qualitative and quantitative output. With valuable inputs from an expert, the MSME can be acquainted with breakthroughs in manufacturing process as well as understanding the benefits of working with SaaS and other analytics software start-ups.
Infrastructure and Manpower: To better the infrastructure for MSMEs in India, the MSME Ministry has adopted a cluster development approach. This has been done with an aim to enhance the productivity and competitiveness. The Micros and Small Enterprises –Cluster Development Programme (MSE – CDP) will aid the MSMEs with the required infrastructure including sourcing skilled manpower to run the business. An expert can help the business narrow down on the right cluster that is at par with the needs of the business.
Tackling the major challenges as mentioned above can help the MSME sustain itself successfully in the most competitive market though it is imperative to remember that passion for running a MSME has to be guided. A complete know-how of the MSME sector along with the recent developments in terms of Government schemes and compliances that have to be adhered with have to be kept in mind.
| Did you Know? Under the Scheme of Fund for Regeneration of Traditional Industries (SFURTI), post the revamp in 2015, a total of 34, 791 artisans have benefitted with an assistance of Rs. 143.15 crore during FY 2018 – 19. The Ministry has also set up the Scheme for Promotion of Innovation, Rural Industry and Entrepreneurship (ASPIRE) which comprises of a network of technology centres and incubation centres to accelerate entrepreneurship and also to promote start-ups for innovation and entrepreneurship in the agro-industry. |
