Vibrant Post Pandemic Era for SMEs- A Way Ahead
Updated: Oct 16, 2020
Covid-19 has hit the world with much vigor that many lost balance and landed on their back foot. There is no doubt that the path of recovery is a long one, but filled with plethora of opportunities. India is one such country which is to witness a huge pump in the direction of national progress in terms with being a global manufacturing hub. We have already been known as a technology and service hub but adding the manufacturing hub to the Indian context promises to secure the future of the country in terms of development.
With opportunities comes challenges too, the current situation demands a huge push towards creating a technologically improved work economy. The nation could be a recipient of the worldwide decoupling from China as organizations begin to move their assembling activities out and need another robust supply chain accomplice which India has the potential to cater. Moving past Industry 4.0 and embracing the digital manufacturing means accelerated manufacturing along with investment opportunities.
Source: Ministry of Micro, Small and Medium Enterprise
Opportunities for setting up an SME in Indian market space are still in abundance with lot many MNCs setting up manufacturing or assembly units in India. A lot more opportunities are present in manufacturing of products that are still being imported by companies for their end products. Certain areas for huge possibility of higher returns in setting up of SMEs have been mentioned. Though it is not the only areas to explore, it does give an insight as to why and where SMEs should be set up
With APPLE setting up a major plant in Chennai and gearing up the assembly of Iphone 11, the sourcing of raw materials and production of smaller chipset, silicon chips and other hardware units is a considerable market for smaller businesses to formulate a supply chain given that APPLE still import their components.
The plastic in India plays a significant key part in industrialization. Dispensable cups, glasses and plates are utilized in everyday life nowadays. The utilization of dispensable things is expanding step by step because of better clean conditions, minimal effort, simple convenience and amazing appearance. Having in view the demand of these items, it can be predicted that there is great scope for SMEs to focus.
The furniture making is an ancient workmanship in India for centuries. The mastery of India in assembling furniture is acknowledged by all over the world. It provides as an excellent domestic as well as international market subjected to intricate designs for entrepreneurs to set up manufacturing units in.
Compressed wood is a major product that is still being handles by a few in terms of production. Considerable raw materials are directly drawn from furniture industry itself and unprocessed wood flour hence obtained has tremendous demand in markets as fillers, extender and binders among many other uses. Compressed woods are most sought after in the logistics industry as crates or pallets.
Agriculture and industry growth is dependent on the electricity. With such importance to electricity comes the equal importance for insulators. Insulators can be made from any non metallic inorganic substance. Estimated growth of insulator is set to surpass 8% per annum in the next 5 years. Concern of Government on safety will also ensure the continued demand for insulators in the market.
Apart from cement, sand and aggregates gypsum has also become an integral material in construction sector. Easy to shape and superior finish gives it the edge over traditional finishing methods. Decorative finishes, fire resistance, water repellent are some of the verticals under which gypsum boards are categorized and it is seen as a must in construction.
LED light Assembling in India is still in infancy stage compared to other countries, we mostly have a range of brands from international markets with competitive prices, As an assembling unit or manufacturing unit for large enterprises like Wipro or GM can be profitable given that the verticals under the big enterprises can be expanded with domestic outsourcing.
Government of India initiatives such as Promulgation of MSMED Act, Procurement Policy of MSEs, ASPIRE, PMEGP amongst several others are meant to promote the setting up MSMEs across the country. Apart from that comes the initiative taken by government of other nations such as Japan, US in financially backing the relocation of manufacturing units from China to India. In May, as part of the Atmanirbhar Bharat package, finance minister Nirmala Sitharaman had announced the Rs 3 lakh crore ELGS scheme aimed at providing liquidity to micro, small and medium enterprises till October 31.
Indian enterprises need to build strong digital manufacturing capabilities in order to take advantage of this situation. Rather than playing catch up with the tech talent of the world, it is time Indian SMEs take the imitative in faster adoption of digital technologies. Reports noted that while national lenders focused retail trade and the services sector, a very small fraction of the loans have been taken for manufacturing activities in the current plan but is soon to change in the coming times. Government also is suggesting of another loan to fire up the augmented growth during the pandemic period to improve business volumes and support growth prospects
The pandemic has exposed many weaknesses in traditional supply, forcing businesses to demand more transparency, better cost and quicker turnaround times. Tapping into the post pandemic opportunities will enable the SMEs to have a wider or even global reach. Lot many areas have also emerged in the recent past where the big enterprises need lot many SMEs to maintain their supply chain at any point. All these do hereby suggest a more positive future for the people looking towards starting a small business.