MSME in India

MSME in India is struggling. Here’s how going digital can help them succeed!

Imagine this:

You start a small business. It took you a while to generate the idea, arrange for the funds, look for a suitable location, and find labor. After getting a small business loan, all your dreams came true.

The first few months, you made decent money. Life will be better for my family! And that’s when the pandemic arrived, and the government issued a lockdown. The business takes a hit, sales go down, cannot pay the shop rent and the loan EMI anymore. It comes down to two options – Arrange for funds or shut down your dream business.

This story is about millions of small business owners in India. To be exact, 6.3 crore businesses.

This is a story about Micro, small, and medium enterprises (MSME in India).

Micro small medium enterprises meaning:

As per the Government of India, MSME includes micro, small, and medium enterprises where the investment in machinery or equipment does not cross 1 crore, 10 crores, and 50 crores respectively.

Information about MSME sector India:

1. MSME sector contributes 29% of our GDP.

2. MSME sector is rapidly accepting digital payments. 72% accept it, and 28% prefer cash transactions.

3. Micro small medium enterprises minister Narayan Rane announced that the budget allocation for MSMEs in FY22 has doubled to Rs. 15,700 crore compared to Rs. 7,572 crore in FY21.

The MSME sector almost contributes one-third of our success. Protecting and helping this sector grow is the least everyone can do. With life getting back on track, these businesses want to get back to their feet. While some are back on track, many SME companies in India are still suffering and looking for a solution.

How does going digital help MSME in India?

With most of your customers working from home, taking the digital route is crucial for MSME. These businesses need to go digital to survive, compete, and succeed. Here are a few ways this is possible.

1. Get subscription management software:

Getting subscription management software for your business sorts multiple problems for you. It can automate many tasks, handle billing, and help you understand your customer. You can run your business smoothly, use data and analytics to understand what’s not working for your business and change your plans.

2. Create social media profiles and your Google business profile:

Today, creating social media profiles on Facebook, Twitter, Instagram, and a Google business profile is a must. As a small business, customers can find you faster if you are active on social media. You can accept orders on social media and conduct business.

Listing your business profile on Google is essential, as customers can locate you. Most customers are searching for products to buy on Google. Also, most will read reviews before making a buying decision. So work on your Google profile ASAP!

3. Communicate with customers & take their suggestions:

Customer is the king! Treat them like one. Running a business doesn’t just mean creating a product and selling it. Understand what your customer likes and dislikes. Take their suggestions. When you communicate with your customers and take their recommendations, it improves their relationship with you. This can be an enormous boost for your business revenue.

Using social media, you can send promotional offers, discounts, and other notifications. Staying in touch with customers is necessary, so they remember you while making a purchase.

The future of MSME in India:

Life after March 2020 has seen a growth in Digital India. Most of your existing and potential customers are using their phones a lot. Also, 72% of businesses accept digital payments. If you are not accepting digital payments, you might lose most customers to competitors. The same applies to your business not being listed on Google.

Also, with technology growing at a rapid pace, any MSME can try these 3 steps to take their business digital and succeed quickly.

References:

  1. RBI – Definition of MSME
  2. IBEF – Data on MSME
  3. TOI – Data on Collateral free loan for MSME

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