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Small Enterprise Management

Small scale industries are defined based on the level of investment in plant and machinery. They are typically capital intensive, employ fewer than 10 workers, produce light consumer goods, and are located in rural or semi-urban areas. Small industries are classified as traditional like handicrafts or modern like electronics. They contribute significantly to the Indian economy by providing employment, being dispersed widely, and complementing large industries. However, small industries also face problems like lack of finance, raw materials, markets, and modern production methods. The government and organizations provide various forms of support including financial, technical, training, and marketing assistance to help small industries develop and address these challenges. Small industries now also play a major role in international business, with sectors like

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Hameed Rawther
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47 views14 pages

Small Enterprise Management

Small scale industries are defined based on the level of investment in plant and machinery. They are typically capital intensive, employ fewer than 10 workers, produce light consumer goods, and are located in rural or semi-urban areas. Small industries are classified as traditional like handicrafts or modern like electronics. They contribute significantly to the Indian economy by providing employment, being dispersed widely, and complementing large industries. However, small industries also face problems like lack of finance, raw materials, markets, and modern production methods. The government and organizations provide various forms of support including financial, technical, training, and marketing assistance to help small industries develop and address these challenges. Small industries now also play a major role in international business, with sectors like

Uploaded by

Hameed Rawther
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPT, PDF, TXT or read online on Scribd
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Module 1

Small Enterprise Management

Meaning and Definitions


1.

Definition Conventional Definition:SSIs include cottage and handicraft industries which employ traditional labour intensive methods to produce traditional products largely in village households.

2.

Operational definition:All those undertakings having an investment in fixed assets, plant and machinery whether held on ownership terms or by lease or hire purchase not exceeding Rs 3 crore. Tiny unit :

A tiny unit is one whose initial investment in fixed assets in plant and machinery doest not exceed Rs 50 lakhs.
Ancillary units:

An ancillary undertaking is one whose investment in plant and machinery does not exceed Rs 50 lakhs and is engaged in
The manufacture of parts, components and assemblies tooling or intermediate or Rendering of services or other units for production of other articles

3.

National income accounting :This includes all manufacturing and processing activities including maintenance and repair services undertaken by both household and non household small scale manufacturing units, which are not registered under Factories act 1948

Characteristics of small scale industries


Capital Investment is small Most have fewer than 10 workers Generally engaged in production of light consumer goods and processing Located in rural and semi urban areas Most of these firms are either privately owned or sole proprietorship Hired workers are un organized Exploitation of natural resource

Classification of SSI
Traditional small Industries
Handicraft (All India Handicraft Board)
Wood carving , ivory carving, metal works

Village and household industries (KVIC)


Pottery Silk materials, Textiles, leather product

Modern small industries


Electric Goods, T.V.Sets, Ancillary to large units

Significance of SSI
1. Small is beautiful : 2. Innovative and productive: 3. Individual taste and fashions personalized services: 4. Symbols of national identity : 5. Happier in work: 6. Dispersed over wide areas:

and

Contribution of SSI to Indian Economy


Employment Less capital Decentralization Fair Distribution of Wealth Utilization of latent Resources Helpful to Democracy No Evils of factory System Increase in Production Complementary in large industries Quick investment and quick yield

Problems of SSI
Problem of Raw materials Problem of Suitable machines Lack of finance Absence of marketing facilities Primitive methods of production Problem of competition Burden of taxation Problem of finding markets

Measures to develop SSI


Organization Help Central Small Industries Organization National Small industries Corporation All India Board for promotion

Financial Help
State financial corporation National Small Industries corporation State Bank of India National Commercial Banks Credit Guarantee Schemes SIDBI Small industries Development Fund National Equity Fund

Technical Help
The Central small industries Organization Prototype Production centers Central institute for industrial Design Small inventions Development Board Technical education

Other facilities
Training of workers Provision of raw materials machinery and power Marketing Help Industrial Estates DIC

Role of SSI in international business


Year 1994-95 1995-96 1996-97 1997-98 1998-99 1999-00 2000-01 2001-02 2002-03 2005-06 Average annual growth rate Exports (in CR) 29068 36248 39248 44442 48979 54200 69797 71244 86013 124416 14.1%

Item wise exports fromSSI


Major role played by Sports goods Readymade garments Leather products Processed foods Plastic goods Engineering goods Electric and electronic goods Basic chemicals and pharmaceuticals

Sports good 100% Leather products80% Readymade goods90% Lac -98% Cashew86% Processed goods65% Chemicals and pharmaceuticals 55%

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