SMALL SCALE INDUSTRIES

Initially SSI were classified into two categories- those using power with less than 50 employees and those not using power with the employee strength being more than 50 but less than 100. An industrial unit can be categorized as a small- scale unit if it fulfils the capital investment limit fixed by the Government of India for the small-scale sector.

Traditional small scale industries Modern small scale industries

EMPLOYMENT EFFECIENY EQUITABLE DISTRIBUTION OF NATIONAL INCOME ENTREPRENEURIAL SKILL REGIONAL DISPERSAL OF INDUSTRIES LESS INDUSTRIAL DISPUTES EXPORTS

SMERA
SMERA is the country's first Rating agency that focuses primarily on the Indian Micro, Small and Medium Enterprise (MSME) segment. SMERA's primary objective is to provide Ratings that are comprehensive, transparent and reliable. This would facilitate greater and easier flow of credit from the banking sector to MSMEs.

HOW SMERA HELPS

Wide Recognition and Acceptance Memorandum of Understanding (MOU) with Banks Favourable borrowing terms Faster Access to Credit Lower Rating Fees D&B D-U-N-S Number

Reservation of items of manufacture exclusively for the small scale sector Not Applicable to those undertakings operating under 100% Export Oriented Undertakings Scheme, the Export Processing Zone (EPZ) or the Special Economic Zone Schemes (SEZs). Engine of Growth in the new millennium.

RETAIL SECTOR-BACK RIDING

WOMEN ENTREPREUNERSHIP

Small & Medium Enterprises:

Defining SMEs :
In accordance with the provision of Micro, Small & Medium Enterprises Development (MSMED) Act, 2006, MSME are classified in two Classes: a) Manufacturing EnterprisesThe enterprises engaged in the manufacture or production of goods pertaining to any industry specified in the first schedule to the industries (Development and regulation Act, 1951). The Manufacturing Enterprise are defined in terms of investment in Plant & Machinery. (b) Service Enterprises: The enterprises engaged in providing or rendering of services and are defined in terms of investment in equipment.

Manufacturing Sector Enterprises Micro Enterprises Small Enterprises Medium Enterprises Investment in Plant Machinery Does not exceed Rs.25 lakh &

More than Rs.25 lakh but does not exceed Rs.5 Cr More than Rs.5 Cr but does not exceed Rs.10 Cr Service Sector

Enterprises Investment in Equipments Micro Does not exceed Rs.10 lakh Enterprises Small More - Government of India but Small & Medium Enterprises) Source: Development Commissionerthan Rs.10 lakh(Micro, does not Enterprises exceed

Macro view on SMEs :

In most economies, smaller enterprises are much greater in number. Globally SMEs account 40-50% of GDP. As per 4th Census of MSME Sector, the sector employs an estimated 59.7 million persons spread over 26.1 million enterprises. It is estimated that in terms of value, MSME sector accounts for about 45% of the manufacturing output and around 40% of the total export of the country.

Significance of Smes: (Source : World Bank Institute)

Problems faced by SMEs :

SMEs have inadequate accession to the monetary institutions. Their area of business is limited only to the national territory. SMEs becoming sick units. Non-availability of technically trained personnel. Lack of a universal size definition makes business studies and market research more difficult.

Performance of Micro and small enterprises :

Year Number of Enterprises (Lakh Nos.) Registere Un Total d registered Empl. Productio Growth Share In (Lakh n (Rs. Cr) Rate (%) GDP (%) Person) at Current Prices

200215.91 93.58 109.49 263.49 314850 8.68 5.92 2003 200316.97 96.98 113.95 275.30 364547 9.64 5.79 2004 200417.53 101.06 118.59 287.55 429796 10.88 5.84 2005 200518.71 104.71 123.42 299.85 497842 12.32 5.83 2006 200620.98 107.46 128.44 312.52 587196 12.65 5.94 Source: Development Commissioner - Government of India (Micro, Small & Medium Enterprises) 2007

Source: Development Commissioner - Government of India (Micro, Small & Medium Enterprises)

IBEF / Business standard :

Contribution of SMEs to GDP to touch 22% by 2012 IBEF: Oct 30.2009 New Delhi: Small and medium enterprises (SMEs) are expected to contribute 22 per cent to India's Gross Domestic Product (GDP) by 2012, up from about 17 per cent at present, according to a survey by ASSOCHAM. The survey states that the projected increase in this contribution of SMEs to the countrys GDP would be on account of increased production due to technological upgradation. The survey said, SMEs' contribution to GDP is projected to go up by a minimum of 5 per cent and touch 22 per cent by 2012, since over 60 per cent of them are aggressively upgrading themselves technologically. It was also pointed out in the study that liberalization and deregulation in the industry would also contribute to the SME sector's growth, and that the sector could go on to register a 40 per cent growth in the next five years, from 35 per cent in the last two years. The study went on to state that the SME sector contributes 40 per cent to the country's exports and that this share would increase to over 44 per cent with the help of modernized technology.

Development Commissioner - Government of India (Micro, Small & Medium Enterprises) Schemes : Access to Credit: DC(MSME) facilitates credit support to MSEs through various schemes, operated through various financial institutes like SIDBI, NSIC and others. The details about credit scenario including main facilities / schemes operational under DC(MSME) are as below:Collateral free, Credit facility MSEs) Credit to Low income category - CGT-MSE (Credit Guarantee trust Fund for Micro Finance Programme TREAD (Trade Related Entrepreneurship Assistance and

Assistance to Women Entrepreneurs Development)

Enterprise and Skill Development: The Office of DC (MSME) conducts a large number of vocational and entrepreneurship development programmes. The Entrepreneurship Development Programmes (EDPs) are conducted through MSME-DIs, with focus on entrepreneurial skills development coupled with specific skills relating to trades like electronics, electrical, food processing, etc, which enables the trainees to start their own ventures.

Micro & Small Enterprises Cluster Development Programme (MSE-CDP): The Ministry of Micro, Small and Medium Enterprises (MSME), Government of India (GoI) has adopted the cluster development approach as a key strategy for enhancing the productivity and competitiveness as well as capacity building of Micro and Small Enterprises (MSEs) and their collectives in the country. Marketing Assistance: This Office is implementing various schemes, which aim to provide a better competitive edge to the product of MSME sector in the market. Legal Framework Msmed Act: To facilitate the promotion and development of and enhancing the competitiveness of micro, small and medium, enterprises and for matters connected therewith or incidental thereto.

SIDBI India

Small Industries Development Bank of

The preamble to the Small Industries Development Bank of India Act,1989 defines the objective of SIDBI as: "the principal financial institution for the promotion, financing and development of industry in the small scale sector and to co-ordinate the functions of the institutions engaged in the promotion and financing or developing the industry in the small scale sector and for the matters connected therewith or incedental thereto." In the SIDBI charter, four basic objectives are set out. They are: Financing Promotion Development Coordination for orderly growth of industry in the small scale sector.

Product and services: Direct Finance Bills finance Refinance International Finance Micro Finance Government Subsidy Scheme Other Schemes Fixed deposit Scheme Promotional Activities Offices & Network : Head Office (Lucknow) Eastern Zonal Office (11) Western Zonal Office (22) Northern Zonal Office (21) Southern Zonal Office (27) Central Zonal Office (15)

Category wise Product: Institutional Investors New Entrepreneurs Existing Entrepreneurs Existing customers Women Entrepreneurs Microfinance Institutions

SIDBI Associates:
SIDBI Venture Capital Limited (SVCL) Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE). India SME Technology Services Ltd. (ISTSL) SME Rating Agency of India Limited (SMERA) India SME Asset Reconstruction Company Ltd. (ISARC). Small & Medium Enterprises Financing and Development Project (SMEFDP)

FAMILY MANAGED BUSINESS

Definition
A Family Managed Business is one in which one or more members of one or more families have a significant ownership and commitment in the business well being.

Types
Family centric planetary system Public equity capital In some countries, many of the largest publicly listed firms are family-owned. A firm is said to be family-owned if a person is the controlling shareholder; that is, a person (rather than a state, corporation, management trust, or mutual fund) can garner enough shares to assure at least 20% of the voting rights or the highest percentage of voting rights in comparison to other shareholders

History
Kongo Gumi Japanese Construction firm-1400 yrs old Traders and money lenders operating in local markets. Aggarwals and Guptas in the north Chettiars in the south Parsis, Gujrathis, Baniyas & muslim khojas and Memons in the west Marwaris in the east

Top 7 FMB based on Performance Company Industry

Koch Cargill PWC Publix SEM Group Mars C&S wholesale Oil, Gas, Agriculture Agriculture Auditing& Accounting Supermarkets Oil and Natural Gas Chocolate Grocers

Owners of FMB
Name Carlos Slim Mukesh Ambani Lakshmi Mittal John Walton Christy Walton Alice Walton Charles Koch 17.5 b Net Worth 53.5 b 30 b 28.7 b

Some of indias fmb

Company Reliance TATA Ruia Aditya Birla Godrej Future Group Bharti DLF Dabur Turnover in dollars 45.09 b dollars 62.5 b dollars 15 b 34 b 3b 5b 8b 7b 8b

Succession of FMB

India EU FTA Since 2007. Liberalize trade in services. 30 countries (France Germany UK) India-ASEAN FTA Since 2003. Exports to 1tn $ mkt. Brunei, Singapore, Thailand, Malaysia.

India-Korea FTA. Since 2004. Increase Korean inv in textiles and chemicals.

Benefits of FMB
Information Security Commitment Speed & Flexibility Loyalty Long-term strategies Stability

Problems of FMB
Distribution of the PIE Matter of Duty Leadership issues Decisions clash Risk taking ability