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Expert Committee Report on Micro, Small and Medium Enterprises (MSMEs) June 2019: Marketing challenges and government initiatives

Expert Committee Report on Micro, Small and Medium Enterprises (MSMEs) June 2019: Marketing challenges and government initiatives

Business Development

Prashant Shetty

Prashant Shetty

4 Sep 2019, 10:06 — 5 min read

The first article of the series based on the 2019 Expert Committee Report on MSMEs highlighted excerpts from the report, MSME definition and benefits of MSME registration. The second article focused on different registrations to avail of various schemes.

This article focuses on the marketing challenges for MSMEs and government initiatives for the same.

Marketing is a strategic tool for business development and is critical for the growth and survival of MSMEs. MSMEs also face challenges in terms of weak forward and backward linkages for sourcing raw materials at effective price and selling the produced goods in the market. These constraints not only make it difficult for MSMEs to reach global markets but also limit their performance in the increasingly open and competitive domestic markets. 

 

Also read: 4 online marketing strategies to promote your business

 

Challenges faced by MSMEs in Marketing

 

Some of the key challenges encountered by MSMEs in implementing marketing strategies are mentioned below:

Key marketing challenges for MSMEs

 

Government initiatives for extending marketing support to MSMEs

International Cooperation Scheme - Visit of MSME delegations to other countries in international exhibitions/ trade fairs, conferences/ summits/workshops, etc., for exploring new areas of technology infusion/up gradation, joint ventures, improving market of MSMEs products, etc. is supported by the Government

Marketing Assistance Scheme - The maximum net budgetary support for participating in an international exhibition/trade fairs

Procurement and Marketing Support Scheme - To encourage MSMEs to develop domestic markets and promotion of new market access initiatives

Online procurement of common use Goods & Services required by various Government Departments / Organisations (GEMS) - Mandatory public sector procurement from MSMEs as well as provisioning of marketing and trade promotion services to SMEs through direct service delivery and cost subsidy for buyer-seller meets, participation in trade events, provision of market intelligence, trade finance, etc.

 

Marketing is a strategic tool for business development and is critical for the growth and survival of MSMEs. MSMEs also face challenges in terms of weak forward and backward linkages for sourcing raw materials at effective price and selling the produced goods in the market. 

       

 Recommendations of the Committee

  1. Facilitate the marketing side of innovation and assist MSMEs to on-board ‘B2B’ and ‘B2C’ e-commerce marketplaces.

  2. Technology tools like SMS, digital newsletter and electronic direct mail can be used efficiently to target segmented population by MSMEs. Broadly classified as push marketing, these media tools are cost efficient and easily accessible.

  3. Utilise existing Technology Centers (TCs) across the country for providing access to information on Indian and external markets for innovative products and on how MSMEs can benefit from new technological inputs.

  4. Facilitate MSMEs in procuring complete and low-cost ICT solutions to improve their capacity and productivity and build their capacity for adoption of digital tools and industry. 

  5. Developing networks of development service providers that can provide customized solutions to MSMEs that are struggling with capability and resources constraints regarding adoption of advanced technology and marketing techniques.

  6. Launch of incentive and financing mechanism for adoption and commercialisation of technology developed by R&D institutions. Enhanced focus on strengthening of industry academia collaboration to promote applied research targeted at industry’s constraints.

  7. Incentivising large enterprises for providing assistance and guidance to MSMEs, particularly in terms of using the latest technology and bringing them up the value chain

  8. Strengthening of schemes like ‘Consortia Formation’, ‘Brand Building’, ‘E-marketing through specialised MSME portals’, and holding of more domestic and international exhibitions in order to provide increased marketing support to MSMEs.

  9. Strengthening of MSME export promotion council.

GlobalLinker supports SMEs in digitising their business and in making the most of their GlobalLinker account for their business growth. These services include creating a professional digital presence, digitising internal processes, business risk management, business revenue growth and business expense management.

 

Also read: A free and vital marketing tool you are underutilising

 

Image source: shutterstock.com 

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Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views, official policy or position of GlobalLinker. 

Posted by

Prashant S Shetty

Catalyst for corporates seeking financial restructuring and fund raising

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