Govt's five major schemes push for SME growth

Micro small and medium-sized enterprises (MSMEs) play a vital role in the growth of a nation. It is often said that small units are highly responsible for driving innovation and competition in various economies. Presently, the sector is accounted for 17 per cent in Indian GDP, which is expected to grow to 22 per cent by 2012.

Indian economy gets 45 per cent of manufacturing output and 40 per cent of exports from the SMEs as per the ministry estimates. Not only this, the sector employs 60 million people, creates 1.3 million jobs every year and caters to both national and international markets with the production of more than 8000 quality products.

Having been the key growth driver of the country economy, the MSME sector lacks the required cooperation from the government which in turn confines the growth of the sector in the domestic and global markets.

However, there is a slew of government schemes and sops offering enhancement and support to the business activities of the small units, but a majority of small traders fail to avail them due to lack of mindfulness and awareness about the schemes.

Here are five key financial assistance schemes being offered by the government to intensify the growth of the small scale units.

1. Credit Guarantee Fund Scheme for Micro and Small Enterprises (CGMSE)

The Ministry of MSME and Small Industries Development Bank of India (SIDBI) have instituted a trust named Credit Guarantee Fund Trust Micro and Small Enterprises (CGTMSE) for the implementation of Credit Guarantee Fund Scheme for Micro and Small Enterprises (CGMSE), which was formally launched on 30th August, 2000 and became operational from 1st January, 2000.

The scheme is aimed at providing collateral-free credit to both existing and new micro and small enterprise (MSE). The plan covers term loans and working capital facilities of up to Rs 100 lakh per borrowing unit and can be prolonged without any collateral security or third party guarantee to a new or existing MSE.

In case those units covered under this scheme go sick due to the factors beyond their control, the scheme also allows the lender to stretch the rehabilitation assistance. If the credit facility surpasses Rs 50 lakh, it may still be covered, but the guarantee cover will be extended for credit assistance of Rs 50 lakh only.

2. Credit Link Capital Subsidy Scheme for Technology Upgradation

Credit Linked Capital Subsidy Scheme (CLCSS) provides technology upgradation assistance to the SMEs primarily in the small scale industries (SSI). All entities, including sole proprietorship, partnership, cooperative, private and public limited companies, are eligible for the scheme.

The maximum limit of eligible loan for SMEs under the scheme is Rs 1 crore. It comprises a subsidy rate of 15 per cent.

The scheme was first launched in October, 2000 and was revised in September 2005. Under the revised scheme, the admissible capital subsidy is calculated with reference to purchase price of the plant and machinery.

3. Mini tools room and training centre scheme

In an endeavour to assist the manufacturing sector, the Government of India provides assistance to the state governments in setting up the tool room facilities, the backbone of the manufacturing sector as they create dies, tools, moulds, jigs, fixtures, gauges and precision components which are the essential elements for the operations of the production units.

Read more on: http://news.indiamart.com/story/govts-five-major-schemes-push-sme-growth-158127.html

Direct to Home: Pune Farmers' Innovation leads to fresh vegetables to consumers

Agriculture is the largest economic sector in India and plays a significant role in the overall socio-economic development. About, 65% of Indian population depends directly on agriculture, and it accounts for around 22% of GDP. India is the largest producer of fruits and second largest producer of vegetables in the world. 

The government supports agriculture by deciding minimum support prices for the major agricultural crops, subsidies and credit schemes. However, there is a lack of required level of investment for the development of marketing, storage and cold storage infrastructure. According to National Bank for Agriculture and Rural Development (NABARD) post harvest losses accounts about 25% to 30% of production in India.

The solution to this problem is advocated through innovation, which is going to change the game for small and emerging businesses related to agriculture. Kudos to Pune Farmers, who not only cut the middleman from the business, but also find a solution to sell their product directly to consumers. This story was recently highlighted by The Economic Times (ET).

A new trend for small and emerging businesses related to agriculture

According to the ET story, Pune is witnessing a new trend where farmers are offering consumers directly with fresh vegetables right at their door step. The idea is to create a self-help group and adopt new technology for payment system, and then approach the end-users directly with their offerings. 

The trend in the case of Pune has recorded three tonnes of fresh vegetables being delivered at the door steps of more than 200 families which has encouraged the spirits of these farmers. The orders get placed online and they are processed in the village itself. To relish the farm fresh vegetables, the customer needs to pay a sum of Rs. 2, 000/- online to their site. The minimum size of the order has been fixed at Rs 150 per delivery. This innovate idea has caught instant attention of working couples and elderly people. The trend has emerged as a real delight for those who are willing to pay a premium for farm fresh vegetables.

Online delivery of fruits and vegetables is not a new trend in India but what makes the Pune experiment different is being driven by farmers themselves. It is an ideal condition for those who are willing to start a small-sized business related to farming. Earlier, a hefty amount was retained by middle-man and there was no direct contact between producer and consumers. However, with the advent of e-Commerce now it is easy to sell their product online. Further farmers have made a deal with large housing societies to sell inside their premises once a week. It would enable them to offer discounts as well.

Small sized ventures have a huge potential in organic farming

A budding interest in organic food is an answer to a potential business venture. There is a growing concern towards healthy living, and consumers are very apt to pay for foods involving natural farming. Organic products usually get a premium of 10% to 20%. Organic farming also cut cultivation and input costs by up to 70% due to the use of cheaper, natural products like manure instead of chemicals and fertilizers.

How SMEs can harvest profit out of it

As per the existing laws in India, markets for agricultural product can be set up at the initiative of State Governments alone and there is still no provision for individual farmers. Recently, it has been recommended that ‘Special Markets’ or ‘Special Commodities Markets’ in any market area for specified agricultural commodities can be operated in addition to existing markets. Growers are permitted to apply for the establishment of new markets for agricultural produce in any area. Therefore, in a market area, more than one market can be established by private persons, farmers and consumers. There will be no compulsion on the growers to sell their produce to existing markets only.

Therefore, a small-sized venture is in a unique position to tap this growing market by adopting new technology and approaching directly to the end-user with their potentially better offering.

Software for Start-ups: Increasing Your Chances of Success

What has technology to do with business success, well quite a lot! Technology around is changing the way business is conducted today. We are seeing changes in almost every sphere of business. From communications to sales. From operations to supply chain. Many start-ups look for various pieces of low cost/ free business software to manage their businesses, but at a start-up stage, when you are just planning your business, what you really need is software to help you manage your plans, to structure your business better. You don't necessarily need an office/ accounting software at this stage.

Lets help you structure your business!

Starting a business is a whole management process in its own self. Getting a whole part while initiating a business right is absolutely crucial. An entrepreneur does not only have to just get up and start executing, there is much management and planning which goes into creating a powerful business.

The business planning software by winweb helps you do just that. The screen capture above shows how you can use the winweb software to structure your initial ideas and hence come up with a clear business model. 

What does the software help you do?

• business goals planning
• intuitive graphs for easier analysis
• business analytics
• SWOT analysis
• cash-flow planning

And not just this, the winweb business planning software helps you structure many other things for your business like your Go To Market strategy. What decisions you need to make and what are the criticalitie(s) involved. Example, in your marketing the software helps you understand what areas to explore as shown in the screen capture below:

Team IndiaMART Knowledge Services is committed to create new opportunities or SMEs to grow. To know more about how you can leverage the internet and new media technologies, drop in a comment to this post and our team of experts will be happy to help!

Online Freelancing - Starting Up for Entrepreneurs

Entrepreneurship is a tricky path to tread on. A trend seen in India is that entrepreneurs here take the plunge while being supported by friends and family. Fund raising for starting up entrepreneurs is still a challenge and hence many of them start small by working as freelancers, taking up various projects and proving their worth in the market by adding real value.

Freelancing is a good option, but how can you get freelancing assignments?
This is the eternal question. Getting well paying freelancing assignments is an easy game for people who have proven their mettle in the market in their respective domains. For many others who are willing to preset their services at a competitive price, there are many options available in the marketplace.

Get freelance assignments online!!
There are many online sites which present freelance opportunities. Eg: www.freelancer.com, www.odesk.com and the rest.

What do these online platforms help with?

Online freelance platforms allow free registration and help you create a profile which has details of your experience, specialization, organization etc. These platforms act as an online marketplace with buyers and suppliers of services and products. Eg: if you are a blogger, you can post your profile with your specialization on one of these freelance platforms. Any buyer throughout the world who is looking for your set of experience and services can contact you through this platform and enter into an SLA (service level agreement) which will define your scope of work and the rest.

Once the agreement is done these platforms also help the buyers track the success of work done and achieved by the service provider with strong in-built time logging and management systems, where the service providers have to log in to clock in the number of hours required for the work as per the agreement and hence be paid for.

Are my payments secure?

Yes! These platforms have in-built payment mechanisms and on every transaction which happens online, they charge a nominal fee. The buyer and the supplier can decide upon a agreed price and hence start work.

Can I get International Assignments?

As starting-up entrepreneurs you can get many International assignments to start with and as you build your reputation with your work, the trust in your work and services increase and hence you get follow on business.

For starting-up entrepreneurs such platforms are a great source of initial work. Also such initial work can also fetch you long term clients which can be a good source of future business, helping you scale up.

Team IndiaMART Knowledge Services is committed to help the SMEs grow. To know more, drop in a comment to this post and our team of experts will be happy to help!

Opportunity for SMEs in the Vocational Education Space: India Shining

The nearing budget 2011 has become the hot topic of discussion all around. Questions are being raised on the budget offerings for the emerging Indian economy. Each industry has its own set of demands/ needs and requirements.

For the SMEs its all the more crucial, as they are the one's who are creating a strong economic background for the emerging India. Hence they require all possible support to grow to the next level.

What are the new opportunities knocking on the door?
Recently, a major conclave 'National Vocational Educational Qualification Framework for Media and Entertainment Industry' happened in Delhi with Mr. Kapil Sibal, Hon’ble Minister of Human Resource Development, Communications & Information Technology. On participating, we realized how the government is working towards increasing the scope for vocational education in India.

The change: The Opportunity
The objective of the event was to hear from the horses' mouth, the media and entertainment fraternity in India, to create a framework to formally integrate vocational education with current educational streams across schools and higher education space and provide an opportunity and incentive to students to explore the large universe of possibilities.

Many industry leaders present there agreed to the fact that such a step will not only meet the needs of millions of youth who aspire to join the emerging and evolving media and entertainment industry but also meet the human resource requirements of this talent-intensive industry in the coming years.

Education in India has always been focused towards creating an Engineer or a Doctor of a child. In the recent times as talent has emerged across domains, there are opportunities emerging which were not really considered mainstream.

Source: http://www.verparaaprender.com/wp-content/uploads/2011/01/Vocational-Academic-Integration.jpg

Vocational education, mainstream!
For many entrepreneurs, this sounds like an opportunity. The Government is open for creating new partnerships, exploring exciting avenues and building new possibilities in the field of vocational education.This will further the cause of shedding light on many talent intensive industries which actually require mastery and need resources.

In tids and bits companies are doing their own training programs to raise and sustain talent. As the industry is yet not regularized, there lies a great opportunity for SMEs/ emerging entrepreneurs to create industry specific, tailored programs which generate value for the industry at large.

Vocational education - Talent development - Talent Acquisition
For the entrepreneurial minds, the burgeoning Indian education market is an opportunity to cater to. There have been many success stories in the recent past which have shown the power of this industry and its potential.

With the government opening their doors to discussing ideas and opportunities on building vocational education for the mainstream in India, there are underlying opportunities which many entrepreneurs can build upon while working in many models like PPP( Public Private Partnership).

Developing, acquiring and retaining the right talent has always been a pain area for the industry at large and the opportunity to address the same has come at the right time for the seekers. The industry and the emerging companies which can work closely with well qualified experts to deliver custom programs which generate certified professionals.

If you are passionate towards addressing this pain area, wish to add value to the future Indian talent and create possibilities for the industry at large, this is just the right time to explore opportunities in the education sector and add onto the success stories.

IndiaMART Knowledge Services is always committed to be the enabler towards growth for the emerging Indian SMEs. Drop in your comments to this post to connect with us

Making Money for Free: the Fremium Business Model for SMEs

Many a times our Small and Medium Enterprise segment partners have approached us to discuss new business models and ideas. One of the key models which was strongly debated and discussed is the 'freemium' business model.

But how can you position your services just for no price at all?
Well, that's the trick. First things first, as they say and we have been hearing that there are no free lunches in this world. The statement is true and we are not here to make an exception to it. But sure we are here to present a different view and take on what's free - actually! Obviously no business can sustain by giving away all its services for free. A business is out there to make money and that's the way it is.

Lets try and understand this simply, what we are suggesting is: to create a model/ space in your business where you give a set of your services for free, they may possibly be sponsor/ad supported; efficient customers acquisition  through word-of-mouth, organic search marketing, etc. Once you see the volumes building, you can offer premium priced, value added services or an enhanced version of your service to your customer base.

source: http://newmediamonthly.co.uk/wp-content/uploads/2010/11/freemium_model.gif

Would the customer not become used to 'free'?
Many of the SMEs suggested that the customer hence will become used to the tag 'free'. This will lead to de-valuing their brand proposition and also their value in the market. Lets understand why not. You are essentially creating a powerful distinction between the 'free' and 'with value' services that you provide.

For the freemium model to be successful, you have to clearly communicate to your customers/ consumers about the value add's (free) services and the value added (premium) services that you provide. Once this distinction is strongly set and metrics to track the results is put into place, your business can surely reap the benefits of going free!

Successful example of a freemium model
LinkedIn: One of the most powerful 'professional' social networks on the web. All the benefits that you/ your business derives from it are free (majorly all of them). That's the key. Creating an account on LinkedIn does not costs you a penny, other than your time to do so. Also the basic part of networking is free. You can also create a network with people you want for no money at all, globally.

But how does Linkedin sustain then? The freemium model essentially allows LinkedIn to have key information available with them of professionals all over the globe which many lead generation business, business advertisers, recruiters are ready to pay for. Hence millions of users across the globe are effectively pooling together to create a shared knowledge base which many other businesses are ready to pay for.

Freemium for the SMEs
The freemium model is an innovative approach to acquire customers and doing business. Not one size fits all, hence the objectives of implementing a freemium model may differ from business to business. The freemium model has to be custom designed and built into your business model. It may not be about customer acquisition only.

At IndiaMART Knowledge Services we are always partners in growth for SMEs. If you have any queries regarding the freemium model, drop in a comment to this post and our team of experts will get in touch with you.

The ROBO Generation: Business Idea

We all have heard robots speaking in a strange tone, that mechanical sound which comes out obviously is not something which we humans connect with too heartily, though robots may help us in everyday life, performing many a functions!

ROBO - is not robotic, its the new way of perception oriented buying, the new wave of building trust
What is ROBO?
ROBO - is research online, buy online. YES! We all must have heard about E-commerce and in the past few years, we have witnessed the phenomena of E-commerce take a solid shape. There was a time when we were all a little away from the idea of using our credit/ debit cards online, but today, well, a good consumer percentage is buying online.

So how has the online buying space changed the way we have been shopping?
Online shopping has essentially revolutionized the way we have been shopping. Sitting in the comfort of our own homes we can now have access to almost every thinkable product on the planet. We know, its still difficult for many to believe that you can buy something like a piece of cloth online or may be jewelery online! Lets keep this point on hold for sometime.

But why are trends changing
The consumer today is crunched on time. Lets be honest that one thing which we all are crunched about is time and its an obvious when we say/ hear that time is money, well it sure is. The one major benefit of commerce online is saving on time.

But is it simply just about time?

• Access to a wide variety of products globally

Now you can shop for something you liked and get it in your hands from anywhere across the Globe.

• Save Money

Surely many of us reading this blog post must have had engaged in some sort of E-commerce at some points of time in our lives and must have had saved money. There are exclusive discounts present online on many products and its a win-win for both the retailer and the customer.

But how do I trust just a website?

Now that's a real question! How do I trust a website? Its an obvious, that placing trust on just a website is not an easy thing until it is another eBay or a IndiaTimes.

Lets first create an understanding of the technology that goes at the back-end. Its not just a website that you are interacting with, its a portal, which is guarded by strong codes and is highly secure.

While you actually enter the details of your banking accounts/ cards on a website, the actual transaction takes place through the servers of a banking institution and not the website. These are highly encrypted 128 bit codes which are held strongly and hence your information is not compromised.

Obviously you must have a fair look at the website and know about them, before buying from it. There can always be fraudulent sites, which may look like wow, but may be fraudulent at the back-end.

Not satisfied yet, then go read reviews!!

The best part about online shopping is that you can get reviews from customers of a product globally and that too honest one's. And well, companies have had to change many a ways of their operations with the views which have been done online. Eg: the recent Apple MacBook Air 11.5 inches, many customers have uploaded videos on YouTube, actually showing how sometimes the screen flickers and many prospective customers have responded back with their queries on this one!!

That's the power of online commerce. If you actually go through real reviews online before making a buy decision, you will actually be saving both on time and money.

And where is the business idea: the case!

The case we are making here is with social media emerging globally, there are interesting trends as to how customers are changing the way they buy. Their buying behaviors are changing, which is largely being affected by the online commerce.

There still is a good opportunity in the market for platforms which can get customers to actually review products online for the good of many more and brands actually responding back to the same. Though there are platforms existing of the sort, but with social commerce setting in, there is more to what we has been already scratched!

For more entrepreneurial opportunities, well we at IndiaMart are all ears! Get in touch, drop a comment now!