small scale sector in India faces a lot of problems in its day-to-day functioning explain

Dear Student,
1) Finance- Pne of the most severest problem faced by Small sector business in India is the non-availability of adequate finance to carry out its business operations. They start with small capital base and lack the creditworthiness to generate capital from the capital markets. As a result, they hevily depend on local financial resources and are often victims of exploitation by the money lenders.
2) Raw Materials- Due to lack of adequate raw materials, they often have to compromise on quality or buy good quality products at higher rates. Also, they can't buy in bulk as they don't have the facility to store.
3) Technology- Use of outdated technology results in low productivity and higher costs.
4) Capacity Utilization- Due lack of marketing and lack of demand, they have operate below full capacity utilization resulting in higher operating costs.
5) Sickness- Pertaining sickness is an important challenge faced by small sector business units. The sickness is there because of both internal and external reasons.
Regards

  • 0
What are you looking for?