MSMEs are an important and an integrated segment for any Country’s economic growth and employment opportunities. Across the world, there are more than 500 Million MSMEs. In India alone, we have more than 60 million MSME’s that contributes around 17% of GDP and generates nearly 40% of employment. So from employment perspective, it is important for MSMEs to survive and flourish.
We spoke to many Business Owners and made an attempt to understand on why they are not adapting Computers or Softwares or Cloud solutions. Each one had different reasons and let me summarise those challenges based on their inputs and our understanding of this segment.
Today most of the businesses are failing as the Business owners do not understand the complete business or have not done a thorough research on the challenges faced, what is required to be successful etc. Many of them don’t know who is their target customer and how to reach them etc. They copy the successful business and follow it blindly.
1. Reach out to Customers: Most of them follow the same pattern or approach that’s used by their Friends and Seniors. They put on a website and spend money on digital marketing, but do not understand what’s required to acquire the customers and retain them. A prospective customer told us that he spent more than Rs 50,000 (USD 750) on Website, payment gateway etc. and couldn’t get even a single customer through this channel after several months of marketing. His expenditure increased, but not the customers.
2. “Loosing the Trust”: Some (so called) “Consultants” and “Advisors” made sure to collect their fees, but didn’t deliver what they promised to Business owners leaving a bad taste.
3. “My case is different”: Most of the Business owners strongly believe that their business model and customer acquisition strategies are different from others. But most of them repeat the same errors.
4. Resource problems: A frequent churn out of people who are on the key positions can result into Company’s death. I have seen cases where the employees move from one company to another for meager Rs 1000 (USD 15) per month. So this impacts Business owners and he is not able to make a future plans or business expansion.
5. Today many Business owners either follow manual process or use Excel or Expensive standalone software or Depend on Accountants to manage their Accounting work. While the dependency on Accountants and standalone software resolve some issues, but these are expensive and do not solve the problems of business mobility and flexibility on the services, availability of right Information to make a decision etc.
Most of the above challenges are forcing the MSME’s to maintain their own data management system and don’t use any software or external help. They depend more on “Small pieces of Paper Notes” that contains details like who has to pay the money and how much.
You can also check the link at LinkedIn at https://www.linkedin.com/pulse/20141008134706-32517118-5-challenges-of-msme-s-that-s-observed-during-marketing-our-saas-product?trk=mp-reader-card