The micro, small and medium enterprises face problems at
every stage of their operation, whether it is buying of raw materials,
manufacture of products, marketing of goods or raising of finance. These
industries are therefore not in a position to secure the internal and
external economies of scale.
The major problems confronting the sector have been identified
as:
- Technology obsolescence
- Managerial inadequacies
- Delayed Payments
- Poor Quality
- Incidence of Sickness
- Lack of Appropriate Infrastructure
- Lack of Marketing Network
There is lack of trained and experienced employees because
small firms cannot pay high salaries and cannot spend much on training
their employees. Small scale firms find it difficult to recruit and motivate
skilled managerial and technical personnel as they look for better opportunities
in the large scale industries. Therefore, they get the second rate talent
or have to depend on family members who do not have diversified skills.
Small scale units have to face several difficulties in
the marketing and distribution of their products. Most of them do not
have their own marketing network. They find it difficult to sell their
output at remunerative prices due to higher cost of production and non-standardised
quality of products. They cannot afford to spend much on advertising,
sales, promotion, marketing research, etc. They have to sell their products
at throwaway prices due to weak bargaining power and immediate need for
money. They also face stiff competition from large firms.
There can be many more similar issues hindering the orderly
growth of the MSME sector.
Udyami Helpline: 1800 180 6763
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