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SMEs need to make adjustments to stay healthy
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Bikky Khosla | 25 Aug, 2009
Today Small and Medium Enterprises (SMEs) represent one of the fastest growing industrial sectors in the country. Liberalization and globalization have now created both opportunities and challenges for the industry as a whole and more so for SMEs. On one hand they can now aspire to market their products in any corner of the world, on the other hand they face fierce competition in the domestic markets from low cost imports. Moreover, with more than a year of recession, it has become very important for SMEs to reorient their focus according to the emerging market trends and thus strive to become globally competitive.
SMEs now need to identify their strengths and also evolve strategies to strengthen their capabilities in their identified sectors. Having said that, SMEs cannot achieve these on their own and need to be assisted by the respective authorities.
I have seen that despite several government schemes to uplift the SMEs, they are unable to take advantage of these schemes due to several reasons; the first and foremost being their limited knowledge about the incentive schemes announced by the government. I think the situation calls for better communication between the authorities and SMEs to ensure that the incentive schemes do not just remain on paper.
Meanwhile several SME holders whom I have met in recent times have told me that they were losing out on several orders for want of funds. I think this is a problem area and efforts should be made to earmark priority sector lending for SMEs, enhancement of credit limits and overdraft facilities, and enhancement of working capital support from the banks.
Meanwhile SMEs should also look at introduction of new products, product designs, energy efficient and cost effective manufacturing techniques, minimization of waste, optimum use of improved raw materials and packaging, upgrading quality parameters and specifications to counter the slump in demand for older product lines.
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SMEs need to make adjustments to stay healthy
M Subbramanian | Thu Aug 27 06:36:00 2009
The article is clear on a point that SME's are not getting the requisite information of govt schemes. As a suggestion cum solution it would be better to put all the govt schemes clearly in a website and making the webaddress public ie., advt. This helps not only in making awareness but also instill transparency. Hope to get a feedback from you.
Thanks
SME's
A T Goenka | Thu Aug 27 06:00:23 2009
Dear Sir,
Its all very good reading. I foresee that as well as the banks are concerned, they have become very pro-active in helping SME's, provided, they have a viable offer. Even at the cost of over-reaching their limits as stipulated by RBI, they would come to the rescue of the enterprenuer if they see any chance of revival of their account.
The most damaging part, as I see, is the interference of statutory bodies like PF, Sales Tax, Labour, Income Tax, Excise departments and the likes. If you really calculate, the owner driven SME's are bogged down more complying with the requirements of each of these departments than concentrating on business furtherence. Any small lacuna on your part breeds corruption or procecution. There is no middle path. These departments instead of being facilitators are basically prosecutors, imposing heavy penalties for smallest of mistake and calling upon you to attend to them at their whims and fancies releatedly. If the govt. depts give a chance to correct a mistake, being genuine in nature, I feel we will have lot less stress and more clear mind to advance our business. SME's are expected to be proficient with all these laws to perfection and if not, the rule book is thrown on their faces. I am sure all owner driven companies have experienced this phenomenon. Let us work and concentrate in marketing, production and trade and there will always be a better chance of survival.
SMEs
P.A.Vora | Thu Aug 27 02:19:37 2009
As far as Pharma sector is concerned, we have two big associations IDMA(Indian Drug Manufacturers Association) and ADMA (Ayurvedic Drug Manufacturers Association). These two roganisation ahve failed to support SMEs in pharma sector because they do not publish Governemtn FO India's policy or guideline or in my knowledge have never organized any conference on this aspect. They do discuss raw material prices, market slumps etc, but never on how to get benefited with GOI's policy.
SME - Ignore Marketing at Your Own Risk
Ashwin Merchant, SME Marketing Specialist | Wed Aug 26 07:53:39 2009
Recession or difficult time always brings new opportunities for forward looking marketers, businessmen and entrepreneurs to optimize their market share take over competitors’ customers and add more value to current customers. The time is to chalk out a detailed marketing plan for developing existing business with an eye to future.
Make your business a winner and not just a survivor. Invest your time and talent now for future and stay ahead for a long time. You may require adopting a new marketing strategy or market planning to be more cost effective using lucrative marketing techniques and tools
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Re: SME - Ignore Marketing at Your Own Risk
Vinay Joshi | Wed Aug 26 18:28:58 2009
Dear Mr.Ashwin Merchant,
Several postings of mine stated that SME has an opportunity in disguise to expand, upgrade, explore markets thro' third party exports [merchandising] from competitive countries, avail incentives of Govt.for self export et al,
Most fundamental aspect, SME's Funding. How many SME's have walked into their Bank to question them about funding? How many have stated that we require funding w/o collateral as per the Nationalised Banks policies?
Regards,
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SMEs need to make adjustments to stay healthy
jitesh agarwal | Wed Aug 26 04:57:13 2009
The government policies are not being communicated properly to the first generation youth who are capable and intrested for enterpreneurship.Also the policies are not implemented properly due to lack of transparency in fucnctioning of the DICs.A handpicked few including those who are already in the trade take the benifit.Also banks usually don't co-operate with the first generation enterneurs.
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Re: SMEs need to make adjustments to stay healthy
Vinay Joshi | Wed Aug 26 18:05:52 2009
Dear Mr.Jitesh Agarwal,
Have you ever questioned any authority including DIC or say Bank?
If so post your questioning with details i will answer your post, if requd suggest how to pursue further.
One has to be abreast to know the respective policies, do not blame the Govt./ it's policies.
Regards,
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Time cost analysis
Sachin yete [y2.sachin@gmail.com] | Wed Aug 26 04:46:30 2009
There should be a mechanism which advises bankers about SME requirements,with emphasis on timing. SME`s cannot have structured way of functioning as corporates. They are in process of evolution. Tis should be understood and proper guidance be given by proffessionals. This will create a system of transparent and efficient transactions, wherein SME`s focus on their strength and the banks on funding. The independant Monitors view and review the process. This way total volumes can increase multifod creating win -win situation for all.
SME'S UNDER STRESS
Ravi Ajitsariya,Guwahati | Wed Aug 26 02:19:10 2009
In India the beaurocracy and red tappism has eroded the very gloosy idea of SME's. Now, the government wants to develop the sector without removing the inspector raj system. In the meantime, the SME's holder started their steriotype job work in order to sustain and dig out profits to meet expenses. In such a scenerio, how can one expect to introduce new products every time and then.
Fund of SME
S.MUKHERJI | Wed Aug 26 01:55:16 2009
We are manufacturer of Air Pollution Controlling Equipment , thanx to globalization we have been receiving several inquires but due to insufficient funding from the financial institutions we are unable to execute the same, We heard of several government schemes but when we approach it seems very complex and even managers of the banks doesn't have proper knowledge of the product.
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Re: Fund of SME
RAVI AJITSARIYA | Wed Aug 26 02:22:29 2009
IT SEEMS THAT THE GOVERNMENT IS NOT SERIOUS IN IMPLEMENTING THE SCHEMES, IT SIMPLY SHRUGS.
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Re: Re: Fund of SME
Sharad Agarwal. | Wed Aug 26 05:46:39 2009
It is not about the government it is about the individual ministers who indulge in some scrupulous activities & make sure that funds loans are sanctioned to their near & dear ones & friends. They have never been interested in development of the country. A classic example is the Ms. Mamta Banerjee/Tata Nano case. If the now railway minister had allowed Tata group to manufacture the car the state of bengal would have prospered, as other big & small industries would have come up there & the employment status of Bengal & the near by states would have improved. Developments are not the first priority for any minister.
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Re: Fund of SME
Vinay Joshi | Fri Aug 28 20:17:56 2009
Dear Mr.S Mukherji,
Kindly post to me your product profile, with your banking details. Also state which Nationalised Bank has refuted your funding & on which ground.
Yes write to me -- vinay_omimpex@yahoo.com
You also post your client details, i will ensure you will avail bank sanctioned limits as per the Banking norm[s].
This is in my professional endeavour to render my advise w/o any charges by me nor any bribes involved whatsoever with whomsoever.
If your funding is feasible / viable yet no Nationalised Bank funds it you can very well approach the higher authorities.
You have to also tell them that under the Trust fund scheme, initiated by SIDBI, Bank loans can be availed w/o collateral upto a specified amount [Rs 18.75 lacs - 75%] insured, rest not.
I would also suggest to appraise your good self with the FTP policy measures announced for subvention of interest & grant of ezxport credit facilities, etc, et al;
Hope you view this posting from Mumbai.
Regards,
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