Why Indian SMEs Struggle to Grow & How to Overcome it?

The MSME area has grown exceedingly over a previous couple of years in India. The sizable ability for the boom in the destiny years while putting off poverty and unemployment can be the maximum critical bottlenecks for increase.

The micro, small, and medium firms aren't free of demanding situations, no matter their capability. Here, we'll look at some of these challenges confronted by MSMEs in India. The world has been shaken by the coronavirus and its markets as numerous developing nations find it difficult to overcome the economic effect of this health emergency.

The worst component is that this kind of state of affairs has never occurred before. Consequently, no person features a foreseen mechanism to address the chaos and damage. This situation is extremely dynamic. To predict anything as of now could be a risk to the financial system.

MSME in India is recognised as a serious contributor to the monetary procedure of the country. The actual reality often reduces the essence of MSMEs at some stage in the United States of America, and it affords employment opportunities to shut 40% of India's labour pressure.

As consistent with India's federal reserve financial institution, during the year 2015-16, the MSME area was created by over 51 million enterprises. The MSMEs manufacture about 8000 merchandise, which ranges from traditional to elegant merchandise. After getting hit by a pandemic in digitalisation, MSMEs are looking at ways of their survive. Between these processes and manufacturing, they face a lot of day-to-day challenges.

These are the challenges confronted by the MSMEs in the present-day scenario.

  1. Loss of professional workforce

  2. Backwardness in technology

  3. The higher interest rate on credit

  4. Inadequate get right of entry to the market

  5. Inadequate infrastructure facilities

  6. Lack of skilled workforce

Maximum western countries expect their labour to be skilled earlier than enrolling within the industry. Germany is known for its manufacturing region and demands a professional ability certification for its workers. This boosts the productivity of the sector.

The main problems India faces right here are -

Labour issues

The major problem businesses also need to emphasise skill development, training, and ensuring marke

t linkages to facilitate both urban and rural micro-entrepreneurs.


To solve the problems of Labour, You need an expert team of individuals in your company who have those experiential skills in the specific domain to execute tasks Correctly and Safely. Alongside making sure the Company assets are not harmed.

This will help you to increase the output of the labour and will make the work more efficient.

You should hire a Skilled workforce in the following ways:

  • Linkedin

  • Hirect.in

  • Indeed

  • Naukri.com

  • Facebook Groups for specific Domains.

Technology backwardness

This is one of the essential constraints confronted by using MSMEs. The MSME in India lacks statistics and is regularly unaware of the most recent technological tendencies within the global market. Once in a while, they lack managerial abilities, understanding, and technology-intensive education to run a ready MSME.

It's believed that technology can play a pivotal position for MSMEs way to its opposition from neighbouring international locations.

Consequently, MSMEs need to test out this remember very seriously. Technological up-gradation is a must for Indian MSMEs to have a competitive edge in the market.


Technology usage is an Utmost necessity Post-Pandemic.

  • List your business on social media ( Google My Business)

  • Build an Interactive Websites which clearly defines your expertise and offerings

  • Build a Facebook Page to grow your social media presence

  • List your business in Online directories (Indiamart, Sulekha, Just Dial, Alibaba)

  • Build a Linkedin Profile of your Business

The Credit Conundrum

A concerning gap in India'sIt's MSME sector has been the credit supply shortage to MSMEs. The lack of access to the banking sector is another task that haunts this area is a lack of ability to get admission to good enough and timely credit scores at a lower price. Quite some researchers have indicated that MSME in India is hindered by using negative credit availability.

Now, if we glance to recognise the intent behind this, we all realise that a few banks may have excessive-chance notions concerning this region. Consequently, the transaction charges also are high for mortgage appraisal. The gamers of MSME aren't in an outstanding role to supply collateral to urge loans from banks.


Credit Supply Shortage is totally dependent on the Performance, Goodwill and Contacts of the Business owners.

Building connections which facilitate the process of credit approval requires networking with people of similar Industries.

Start Joining Different Associations in your Industry ( below are some examples)

  • Local Associations ( In your District) - YEIDA, GNIDA

  • State Associations (At the State Level) - Laghu Udyog Sangh

  • National Schemes ( At National Level) - FISME, WASME

  • Chambers of Commerce and Industry - SME Chamber Of India

  • Join Programs by Development Authorities in your State - Start in UP

If you are interested in Joining these Associations, send us a message, and we can send you a personalised list of Associations to join in your area or State.

Inadequate infrastructure facilities

Having true infrastructure facilities is crucial to the growth of a commercial enterprise, and a shortage of infrastructure facilities like energy infrastructures negatively affects the productivity and profitability of producing SMEs. MSMEs are located in industrial estates, operational in city regions, or have become unorganised in rural areas. The infrastructure facilities in such areas are terrible and are now not reliable.


There are a lot of Schemes and Programs introduced by the Central Government, State Governments, And Associations for the Upliftment of the MSME Sector.

Here are some of these Programs for your reference :

  • Market Promotion & Development Scheme (MPDA)

  • Revamped Scheme of Fund for Regeneration of Traditional Industries (SFURTI) -

  • Coir Vikas Yojana (CVY)

  • Export Market Promotion (EMP)

  • Domestic Market Promotion (DMP)

  • Trade and Industry Related Functional Support Services (TIRFSS)

For Specific Schemes and Program related information, you can reach out to us, and we can send you a. detailed information on the specific Program catered for your business.


Loss of selling is any other predominant problem SMEs face. Either the same isn't always conscious of the effects of selling, or they no longer own sufficient skills and tools to plug their product inside the proper channel to the appropriate marketplace. Every other challenge inside the advertising SMEs faces the technology and current developments.

Most e-commerce begins with social media like LinkedIn or Facebook, and consequently, these platforms now have additionally brought a feature for business. SMEs may additionally have a drag by being ignorant of the online advertising and marketing platform channels, which, if adopted, could grow their credibility and business.


Marketing is the most crucial aspect of MSME after the Pandemic. It is a dire need for SMEs to market their businesses.

The main advantage of doing marketing will help them in building the credibility of their business and will help them in generating Leads for their business due to their credibility.

The best ways to Market your Business are:

  • Build credibility on Linkedin by posting content in your industry.

  • Start using online ad platforms ( Facebook ads to reach out to a larger pool of your potential Customers)

  • Build a Strong SEO Strategy to rank the highest amongst your competition

  • Focus on Quality Lead Generation on auto mode using Case Studies and Testimonials


After the pandemic, the world and market have changed tremendously. With the help of digitalisation, many businesses have managed to survive and grow. On the other hand, MSMEs have not survived due to the lack of technology and skills. MSMEs need to adopt digitalisation to get the maximum profit and retain their business to grow worldwide.


Business Automation and Digitisation of the Brand is really necessary for its existence.

It all boils down to Processes and strategies to use for automating the processes in your business.

  • CRMs - Customer Relationship Management

These management systems are the need of the hour.

You can automate all your data and tasks using the CRM tool

  1. Daily Sales Tracking

  2. Product Inflow& Outflow Tracking

  3. Accountability Tracking

  4. Building a list of all the Leads - ( Segment the further)

  • Interested Leads

  • Rejected

  • Potential

  • No response

  • Sales Qualified

  • Marketing Qualified

  • Priority

  • Customers


AND MUCH MORE. The list is endless. A lot of strategies and processes can be implemented in MSMEs to Grow their business and generate profits efficiently.

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