Professional Documents
Culture Documents
the utmost problem SMEs are facing is lack of marketing skills -due to the lack of non-availability of raw materials and
difficulty in accessing sufficient working capital ( NSIC )
Financial Problems
1. Low profitability 2. Delayed Payment 3. Inefficient finance management / recovery of receivables /poor liquidity 4. Scarcity of capital 5. Limited access to Bank finance 6. Absence of collateral security 7. Lack of information about various sources of finance 8. Bad Credit Rating 9. Unaware of Various policy support & incentives 10. Margin money / seed capital 11. Working capital requirement 12. Limited access to venture capital 13. Limited access to share market 14. Limited exposure to factoring & bill discounting 15. Unhealthy credit terms 16. Seasonality of raw material & high inventory cost 17. Ineligibility of products for bank finance
1.Low profitability
Price war from large players Dumping & low price imports Low quality production High cost of raw material High cost of capital Economies of scale High cost on transportation
2. Delayed Payment
Delayed Payments Act, 1993
7. Lack of information about various sources of finance 8. Unaware of Various policy support & incentives 9. Bad Credit Rating
SME Rating Agency of India Limited
10. Margin money / seed capital 11. Working capital requirement 12. Limited access to venture capital 13. Limited access to share market 14. Limited exposure to factoring & bill discounting 15. Unhealthy credit terms 16. Seasonality of raw material & high inventory cost 17. Ineligibility of products for bank finance
MARKETING problems
1. Lack of professional approach in doing business 2. Lack Professional Marketing Skills 3. Language Barrier & communication skills 4. Lack of market Information 5. Lack of specific market segmentation 6. Lack of awareness of consumers preferences 7. Incompatibility of products with market need 8. Unmatched customer demand
9) No market survey & After sales services 10) Lack of proper networking & distribution channel 11) Imbalance between production & marketing /Over stock or Stock-out situation 12) Inefficient Supply chain management due to large number of intermediaries 13) Location disadvantage & limited access to market 14) Lack of Branding 15) Lack of design & Innovation 16) Low Quality Products 17) Packaging 18) Standardization & certification 19) Patents & Trade Mark 20) Advertising ,
21.Limited Access to Electronic & Print Media 22.Limited Access to Trade Fares & Exhibition 23.Limited access IT & E-commerce 24.Inadequate supply of Raw material & High cost of production 25.Pricing decision / Pricing pressure 26.Barraging power of Market intermediaries 27.High Cost of Production / Low Economies of Scale / Low Productivity 28.Stiff competition from large players 29.Globalization / Liberalization & Free Trade 30.Stiff competition from developing countries like china Japan 31.Limited Access to International Market 32.Lack of awareness about various growth strategies/ back ward & forward linkages // Ancilerization & Outsourcing 33.Smuggling & Under invoicing 34.Unawareness of social compliance & environmental laws
HR related problems
1) 2) 3) 4) Illiteracy , Incapable or inefficient management Shortage of skilled manpower & modern technology Improper manpower planning Absence of vision & adaptability to changing environment Difficulty in attracting & hiring good talent Retaining Good Talent Unwillingness to invest in Human Resource Development Lack of proper training & development
5) 6) 7)
8)
9) International Labour Laws & other regulatory burden 10)Lack of technical knowledge 11)Low entrepreneurial skills 12)Low investment in Research & development 13)Reluctant to learn new skills 14)Copy of product design /process & unawareness of intellectual property rights 15)Stringent Labour Laws & administrative policies
15) The Industrial Employment (Standing Orders) Act,1946 16) The Inter-state Migrant Workmen (Regulation of Employment and Conditions of Service) Act, 1979 17) Labour Laws (Exemption from Furnishing Returns & Maintaining Registers by Certain Extablishments) Act, 1988 18) Maternity Benefit Act, 1961 19) The Minimum Wages Act, 1948 20) The Payment of Bonus Act, 1965 21) The Payment of Gratuity Act, 1972 22) The Payment of Wages Act, 1936 23) The Sales Promotion Employees (Conditions of Service) Act, 1976 24) The Shops and Establishments Act, 1953 25) The Trade Union Act, 1926 26) Workmens Compensation Act, 1923 27) The Weekly Holidays Act, 1942 28) The Industrial Establishment Act 29) Employees Stock Option Act 30) Employees' State Insurance (General) Regulation 31) The Plantations Labour Act, 1951 32) Environment Protection Act, 1998