Step1: Program Applications (Identification of Mentor and Mentee in This Phase)
Step1: Program Applications (Identification of Mentor and Mentee in This Phase)
Step1: Program Applications (Identification of Mentor and Mentee in This Phase)
PROBLEMS FACED BY
easy finance and modern technology, regulatory constraints and lack of basic
infrastructure
dearth of marketing and distribution networks, skilled labour and outdated labour laws.
1. Lack of credit from banks- The MSME`S are presently facing the problems of credit from the
banks. The banks are not providing the adequate amount of loan to the MSMEs. The loan
providing process of the banks is very long and formalistic. The owners of the MSME`S has to
produce different types of documents to prove their worthiness.
2. Competition from multinational companies- In present era of globalization, the MSME`S are
facing the great from the international manufacturing companies who are proving quality goods
at cheapest price. Therefore, it is very difficult to compete with the multinational companies.
3. Poor infrastructure- Though, MSME`S are developing so rapidly but their infrastructure is very
poor. With poor infrastructure, their production capacity is very low while production cost is
very high.
4. Unavailability of raw material and other inputs- For MSME‟s required raw material skilled
work force and other inputs, which are not available in the market. Due to unavailability of
these essentials, it is very difficult to produce the products at affordable prices.
5. Lack of advanced technology- The owners of MSMEs are not aware of advanced technologies
of production. Their methodology of production is outdated. The owners are using older
method in the field of fabricated metal and textile.
6. Lack of distribution of marketing channels- The MSMEs are not adopting the innovative
channels of marketing. Their advertisement and sales promotion are comparatively weaker than
the multinational companies. The ineffective advertisement and poor marketing channels leads
to a very poor selling.
7. Lack of training and skill development program-The training and development programs in
respect of MSME`S development concern is very low .So, skilled manpower is not being available
to MSMEs. The owners are aware of the innovative methods of production. The skill
developmental schemes conducted by the government are not sufficient.
Due to the unorganized nature of the sector, entrepreneurs and workers face difficulties in
accessing government schemes. Consequently, the workers engaged in the MSME sector and
these are often the most vulnerable and poor have very little bargaining power and are
exploited by the middlemen, unit owners, and big business houses.
Unable to take up aggressive marketing, like big industries, they cannot find markets despite
good quality and competent prices.
The dispersed, unorganized nature of the industry also raises issues of quality, bulk production
and inability of meeting big orders. Often individual units lack packing facilities. As a result,
markets, especially for traditional MSEs are shrinking and workers are experiencing a dip in
wages. Moreover, as most non-traditional MSMEs serves as 'captive units "for big industries,
often workers, especially women's do not get paid until the product is picked up. The situation is
same for the traditional sectors where payments are made by traders and even government
cooperation's only often the stock is sold. Thus money is held up, further impoverishing the
workers
The MSEs engaged in manufacturing of products such as paints, dyes and chemical explosives,
minerals, leathers and leather goods, etc., pollute the environment. These nits have to obtain
non pollution certification from the concerned pollution control agencies of the state.
Different segments of the MSM sector are dominated by different social groups. Women are
mostly found in the unregistered sector- food processing enterprises, manufacturing enterprises
and weaving-and often work part time in the family enterprises.
Non availability of quality raw materials such as dyes and yarn (especially for handlooms and
power looms); vital inputs such as power (for power looms, handicrafts, other industrial MSMs);
and proper packaging facilities continue to be a major bottleneck
Tough competition and financial strain have made SME realize that they need a uniform
Assessment system to pit their strength against the competitors.