Needless to say, that the small business sector is increasing its volume with the lapse of time. Influencing the national economy up to certain, it has been regarded as the backbone of India’s financial growth. You probably intended to know about its actual contribution to our national economy. Our intention is also similar to yours as we are promised to highlight in this area throughout this write-up. So, let us discuss why this sector is listed on the top. Even though the legal definition varies in different countries, a business that can be started with a low capital and manpower is regarded as a small business. It can be a corporation, partnership or sole proprietorship.
Obviously, the set of parameters are different in the case of different countries, but the measuring points are same. The number of employees is considered as the best criterion in this regard which is followed by its ownership, annual revenue, nature of management, area of operation, sale, shipment, total asset and net revenue. If you are looking forward to starting a small scale business that is technology driven, you are invited by the fintech companies. If your idea is burning and future-oriented, you will not face any challenge in availing the funding for small business.
Why small business sector considered as the backbone of Indian economy?
If we analyze deeply, we come to know that the small business sector considered as the backbone of Indian economy. As we all know, India is an agriculture based country where 60% of the population directly depends on this profession. We should know that most of the agricultural lands are not suitable for 12 months cultivation. So, a portion of farmers involves with small business projects. You will be surprised to know about the percentage of small business owners who are also depending on farming. This is one of the major reasons behind the dependence of the national economy on this small industry sector.
We cannot ignore the fact that the small industries are the feeder to the large industries which is highly applicable in India. Small business in India is collectively contributing a huge in national employment generation, even though the size of a business is small. Apart from this, the small business sector is dealing with the mobilization of local resources and optimization of Small Business Funding in India.
What are the challenges this sector is facing?
Lack of skill is a major problem Indian small business sector is facing which is followed by the unavailability of technology and capital. Nevertheless, limited production capacity is an area which requires a rapid push by the micro, small and medium enterprises. In this framework, we should not ignore the weaker marketing strategies which are frequently faced by small enterprises in India.