Tag: Small Enterprises

Covid-19: impact on Small Scale Industries

It has been over a year since the Covid-19 pandemic came to India and caused widespread havoc. The virus got noxious day by day even after the implementation of a nationwide lockdown.

This catastrophe was and is still so devastating that it has latched itself on to the economy of the country like a deadly sting of a bee. Though no sector has been left untouched by the pandemic’s spell, the small-scale industries have been hit very hard.

Indian small-scale industries play a key role in India’s export business. 45% to 50% of the Indian export is being contributed by Small Scale Industry sector. Unfortunately, this key business sector has been blown severely by the situation.

More than 80% of the small-scale businesses have suffered a negative impact due to Covid-19 and 70% expect that would take a year for their demands to recover to the pre-pandemic times, as observed by the survey of Dun & Bradstreet, a provider of commercial data, for businesses.

The survey also found out that 60% of the small business would require more support including initiatives by the government to stand up to the ill effects of the pandemic.
It further pointed out the 3 top challenges that might hinder these small businesses to expand, which are- market access (42%), improving the overall productivity (37%), and having access to more finance (34%).

During this time digitization in various sectors and even small businesses have earned them cost reduction and productivity. Small scale businesses have cut their costs by 54% during the time.
The Managing Director of Dun & Bradstreet India says “globally, digital adoption has been accelerated by 7 years due to the covid-19 crisis”.

The pandemic has aggravated the problems of credit facility, market support, and technological advancement that already persisted in pre-covid times.
“Given the intensity and duration of Covid-19, these problems will continue to exist in near future,” says Arun Singh, Global Chief Economist, Dun & Bradstreet, India.

STEPS TO TACKLE THE SITUATION:

  1. Government should allocate funds to these small businesses through financial institutions. These institutions must provide loans at low rates.
    2. These banks must provide loans after obtaining minimum security.
    3.The gap between the customer and producer must be bridged through effective marketing, by organizing fairs and exhibitions.
    4.The licensing procedure must be simple and at ease.
    5.Technological support must be provided to these businesses for their modernization.
    6.Training must be provided to entrepreneurs in technological, managerial, financial, and marketing areas.

We as the citizens of our country and potential customers of the small businesses must also contribute to uplifting them.
After all, what is more, heartwarming than lighting someone’s home and life?

WHAT WE CAN DO FROM OUR SIDE?

There are many small small steps that we can take, for instance,
instead of buying packed flour, we can purchase grains and get them ground from the small local mills.
We can privately fund small incense stick manufacturers and help them in their progress.
We can buy dry snacks from local bakery shops.
Likewise, we can support many other small businesses in our everyday life and bring a difference to them.

After all, helping others is not just a responsibility but it gives real meaning to our lives.

TOP 9 Small Business & Start-Up Ideas for 2020 (ONLINE FROM HOME)

Today, we’re going to talk about TOP business ideas for 2020. They are not going to be those obvious ideas that you can think of yourself like starting a restaurant or a car wash; we are going to talk about ideas based on recent trends, recent growing markets.

How To Start A Business

A very important rule! If you decide to start your own business, your motivation shouldn’t be because someone said: “It’s going to be a great business!”. Your perfect business idea should consist of the following things: it should be something you like doing and it should be something you are really good at.

1. Coworking Space

Remote workers are spurring on a new revolution for white-collar professionals, as many roles traditionally set in the office space transition to working via the web. Since loneliness is an all-too-common affliction for remote workers and working from a coffee shop isn’t always the quietest choice, the appeal of shared coworking spaces grows each year.

2. Posture Corrector

Nowadays, people constantly hunch over their phones and laptops, it’s no surprise that there’s been a rise in back and neck pain. The keyword “posture corrector” gets about 74,000 monthly searches proving to be a great startup idea for new entrepreneurs.

3. Fitness Tech

Apps related to diet and fitness account for 3.31% of all app on the Apple Store. People are constantly on the move. Making it possible for consumers to fit daily workouts conveniently into their crazy schedules closes another barrier to a healthy lifestyle.

4. Men’s Cosmetics

Men’s cosmetics industry is worth approximately $3.4 billion. One of the most popular niche products targeting men is beard oil, a part of the male grooming industry that makes approximately $6 billion in annual sales. Approximately 39% of American men have beards.

5. Food truck

Food trucks represent all the benefits of a restaurant but without the initial investment of a brick and mortar business space. Only 10-20% of food trucks fail, whereas the failure rate for new restaurants can be as high as 90%.

6. Healthy Fast Food

Think about why people flock to their favorite fast-food chains. The price, speed, and convenience offer consumers a quick way to eat on the go and on a budget. With high demand and low competition, healthy fast food makes a great business idea for 2020.

7. Reusable Bags

As people become more conscious of the waste they produce in their homes, some are starting to use reusable bags to lower the amount of plastic waste. Business ideas centered around preserving the environment can help you build a socially conscious brand.

8. Smart Apparel

With smart apparel’s surging growth rates, this niched industry is looking to net over $4 billion by 2024. This subsector is still so new, making it fresh for innovative ideas from budding entrepreneur techies.

9.Travel Consulting

If traveling is your passion and you are always updated about things like best airplane ticket options and hotel deals, then you fit the bill. You can start by helping your family and friends, securing the best travel deals and selling rewards flights.

Hope these ideas are useful to young budding minds out there looking forward to being Entrepreneurs of tomorrow!

Small Business, Big Trouble: The Viral Times

The outbreak of coronavirus has taken back happiness from our lives, at least for some time. It has forcefully changed our long habits. Lot of people from different walks of life are at the receiving end of our changed habits. One important segment is the small traders, shopkeepers and hawkers. Apart from their everyday sale they also depend on major festivals for huge sales. The demand for new clothes and other consumer items usually ensure good profit for them. But no more going out for shopping in crowded markets. It is a difficult situation for them.

The virus has already stopped the celebrations of the Bengali New Year, Eid ul-Fitr and Rath Yatra. The same fate awaits many more. Shopkeepers who sell essential commodities are in a little more comfortable position than the rest. The official notification only permitted opening of shops selling essential goods in the lockdown. In the Unlockdown 1.0 only some non-essential shops have been allowed to open. Still people are afraid to go and buy because of the fear of infection. Hawkers face the worst situation. According to the National Hawker Federation, there are around four crore hawkers in the country. They have incurred a huge loss of Rs. 48,960 crore out of total turnover of Rs. 2,88,000 crores within April. What has happened to them in this lockdown? How much loss have they incurred personally? We do not know clearly. Let us discuss few instances.

Poila Baisakh or Bengali New Year is celebrated in a big way in West Bengal. It is one of the very special days for Bengalis. Each year the markets in Kolkata offer Chaitra Sale, annual shopping festival, from 14 March to 14 April. It ensures a huge sale of new clothes, shoes, earrings and many more items. The markets are kept open till midnight and for a month they remain very crowded. During this time in a month hawkers make about 35% of their total annual profit. The sale attracts around fifty to sixty lakh customers. But this year all those vibrant scenes were missing. The markets and pavements were all empty day and night for the first time in decades. It came as a huge blow to thousands of hawkers. They do not even know how the business will get back to normal.

Eid ul-Fitr is a much celebrated national holiday after one month of Ramadan. This is a special day for Muslims and they buy new clothes and other items to celebrate with their families. The profit from this festival sale is always more than the normal sale in the market. But in this lockdown the usual hustle and bustle was missing in the streets. It turned out to be a low-key affair this year.

The Jama Masjid in Delhi saw the lowest attendance in prayers for the first time. According to the meat vendors and livestock traders, transportation of Eid special meat was held up in Rajasthan and Madhya Pradesh. The poultry farms have also lowered the production due to their heavy loss in April. The supply chain has been broken by serious restrictions followed during the pandemic. Thus all the vendors have faced huge loss in Eid. Some families are out of work for over two months and almost are out of savings. The rise in price and low supply meant that meat was beyond reach for many families.

Rath Yatra is a week-long festival for devotees of Lord Jagannath and his family. In Puri the event draws around five to ten lakh devotees in a week in June. All of them are seen outside the iconic Puri temple where three chariots remain ready to move. It not only attracts devotees but also small street vendors from Puri and other places to earn extra money. The hotels, restaurants and other business establishments wait eagerly for Rath Yatra to have large footfalls. The religious festival has a major economic dimension.  But this year because of the coronavirus the Supreme Court had initially banned Rath Yatra. This had led to great disappointment to those who were waiting to recover some losses. Then the Supreme Court allowed it but imposed severe restrictions, including curfew, to prevent people from attending the festival. The shutdown of airports, railway stations and bus terminuses for nine days has deprived small traders and hawkers of Odisha from the large customer base they expect during the festival time.

We do not know yet how many festivals will be celebrated without shopping. Small time traders and hawkers in the country are facing tremendous loss even after the Unlockdown 1.0. No one can undermine the importance of safety in such times and no one is arguing that we should crowd the markets as before but the fact remains that they are paying a heavy cost because of the pandemic.   

Revision in MSME Definition

With a vision to create more job opportunities in the MSME sector, the Union Government revised the guidelines of classification for MSMEs. The revision in MSME definition will cover more units under MSMEs.  The additional turnover criteria has been added in MSME classification along with the investment criteria.

The new MSME definition – turnover to define MSMEs

Revised Definition of the MSMEs:-

1.      Micro Enterprises: Entities having investment of Rs. 1 Crores and Annual Turnover upto 5 Crores

2.      Small Enterprises: Entities having investment of Rs. 10 Crores and Annual Turnover upto 50 Crores

3.      Medium Enterprises: Entities having investment of Rs. 20 Crores and Annual Turnover upto 10 Crores

Changes in MSME Classification:-

i. Manufacturing and Services Sector have been merged

ii. Limits of Investments in Plant and Machineries / Equipments has been revised upwards

iii. Additional Turnover Criteria has been introduced

The revised definition of MSMEs is to be implemented via an amendment that would further refine the business scenario for Indian enterprises.

The Union Cabinet approved the amendment to change the criteria to classify MSMEs from “investment in plant and machinery / Equipment” to “annual turnover.”

MSME stands for Micro, Small, and Medium Enterprises. MSMEs are covered under and protected the  Micro, Small, and Medium Enterprises Development (MSMED) Act in 2006.