Small Scale Entrepreneur

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1.INTRODUCTION

2.IMPORTANCE OF SMALL SCALE ENTERPRISE

3.PROBLEMS OF SMALL SCALE ENTREPRENURES


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INTRODUCTION

EVOLUTION OF THE CONCEPT OF SMALL SCALE

INDUSTRIES. The definition of small scale industry varies from one country to another.In most of the countries the criteria for defining a small scale industryrelates to the size of employment or capital or both.

In India the definition of small scale industry has undergone a periodicchange .An entreprenuer,who is the owner of a small scale industry isknown as a small scale entreprenur.

The first definition adopted by small scale industry board in 1955 is Aunit employing less than 50 persons if using power &less than 100 persons

without the use of power &with capital asset not exceeding Rs 500000.


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After a lot of changes over a period of 50years the Government of India in its newpolicy initiatives for small industries in

1999-2000 has announced the investmentfor small scale industry to Rs 1 crore.

The employment criteria was dropped in theyear 1960 & a small scale industrial unit wasdefined in terms of investment only.


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A common classification in between traditionalsmall scale industry &modern small scale industry.

Traditional small scale industries includekhadi&handloon,handicraft,coir etc.Modern smallscale industry produce goods ranging from simpleitems to sophisticated products such as television

sets,electronic control system,particularly asancillaries to the large industries.


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IMPORTANCE OF SMALL SCALE

INDUSTYRY

1.Employment generation.

2.Use of local raw material.3.Balanced regional development.

4.Decentralisation of industries5.Mobalisation of capital.


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6.Developing entreprenurship.

7.Equitable distributin of wealth.

8.Training ground for localentreprenurs.

9.Efficient use of productivefactors.

10.Promotion of export.


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PROBLEMS OF SMALL SCALE

INDUSTRIES FinanceInadequate finance is the major problem for small scale units.

Their internal resources are small .Institutional agencies arereluctant to advance money to small industries as they are

unable to offer security.

Raw materialThe availability of raw materials is a great problem for small scale

unit. The shortage of right type of raw materials at standard

prices affects the production programme. MarketingSmall scale units have to face competition from other small scale

units and large industries . They do not have resources andexpertise to market their products .


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Technology

They use outdated technology and old

machineries . Due to limited capital,they find it difficult to use modernmachinery .

As a result , the cost of production tendsto be higher and quality of productslower than small scale industries.


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Underutilization of capacity

The small industries have a problem ofunderutilization of capacity due tworeasons: 1.frequent power cuts 2. inabilityto go for alternatives like generators.

Recovery

One of their basic problem is recoveries fromsale . The buyers do not pay their dues intime.


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Institutional Constraints

The small entrepreneurs have to approachseveral agencies to get their requirements.As a result they are not able to get theassistance in time .

Other Problems

They also face problems such as imperfectknowledge of market condition , lack ofinfrastructure facilities , deficient

managerial skills , etc .


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THANK

YOU

Small Scale Entrepreneur

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