Managing Small and Medium-Sized Business Enterprises

Managing small and medium
sized business enterprises
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Contents
Introduction.................................................................................................................................................3
Main body...................................................................................................................................................3
Contemporary issues relating to SMEs and government support available to businesses........................3
Evaluating development routes for an SME............................................................................................5
Alternative methods of growth in SMEs..................................................................................................6
Investigation and evaluation of sources of Finance.................................................................................8
Proof of designing a growth policy........................................................................................................11
Understanding of changing issues in SMEs...........................................................................................12
Conclusion.................................................................................................................................................13
References.................................................................................................................................................14
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Introduction
In the Indian economy small medium business enterprise is considered significant sector
as there is contribution in generation of employment, export innovation and economy growth. It
defines the back bone of socio economic development in country. The SME is based on
investment in plant and machinery or equipment. In small enterprise the investment in plant and
machinery is up to Rs.10 crore and annual turnover will not exceed to Rs. 50 crore. In medium
enterprise the investment in plant and machinery is up to Rs.50 crore and annual turnover will
not exceed to Rs. 250 crore. It is a company which maintains the revenues, assets and number of
employees under a certain limit. In study the discussed topics are contemporary issues,
development routes, and alternative growth methods (Álvarez Jaramillo and et.al., 2019).
In the report, have a look at the dialogue is executed at the corporation “Federation of
Small Business”. It is an enterprise corporation of United Kingdom on favor of small as well as
medium-size enterprise. It changed into added in year 1974 as countrywide Federation of Self
Employed (NFSE). Further on, the call changed into followed in year 1991 that is enrolled with
corporate house. It is a non-for-income as well as non-celebration governmental corporation that
gives number advantages like 1 day felony recommendation as well as enterprise of banking.
The employer headquarter is in England. Mike Cherry is the present chairperson of the FSB. It
has more than 184 branches across the United Kingdom as well as categorized into 33 different
nations. In the present report, have a look at we've mentioned the increase as well as demanding
situations confronted through SME, assets of price range along with ideas at the control of Small
and medium enterprises.
Main body
Contemporary issues relating to SMEs and government support available to
businesses
The challenges faced by the SME are:
 Lack of advanced technology- The SME face the challenge in lack of proper technology
as artificial intelligence based machines and tools, enterprise resources planning, inventory
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management and computer programs makes the organization organized. It decreases growth
in terms of productivity and low sales by not adopting updated technology which makes the
organization uncompetitive in the market.
 Lack of credit- To start a business it requires small amount of fund if the person has
excellent idea or innovative product. It looks towards lending institutions for availability of
funds but some institutions are not friendly with new business owners therefore SME face
the challenge in terms of unavailability of proper funds. The SME face difficulty in
obtaining loan because of high interest rate, complex collaterals by the bank and
disbursement delay all this hampers the growth of the SME if not available on timely
(Araujo-Cabrera and et.al., 2017).
 Inadequate marketing- If the business has innovative idea does not become profitable
because of lack of marketing. The SME faces the challenge in marketing of products and
services which leads to low revenue and insufficient government support. There is always a
scarcity of budget faced by the SME which does not provide the opportunity of doing
international business of product or services.
 Cumbersome regulatory practices- The SME face continues constraining factors of
regulatory practices involving construction permit, resolving insolvency, collateral security,
and taxation. The growth of the enterprises is affected due to absence of regulatory body
and inadequate provisions for startup (Bhandari and et.al., 2018).
The government supports available to SME are National small industries corporation
subsidy it provides the benefit of financial in two forms 1. Raw material assistance it
provides the purchase of raw material from abroad. 2. Marketing assistance with marketing
process the sale of product and service is improved in efficient manner. The SME gets the
support from government in the relief of tax as schemes is given such as R&D tax credit,
patent box and capital allowance for reducing tax liabilities. The government provides
various national business support programmes such as manufacturing advisory service
(MAS), Growth accelerator, UK trade and investment, technology strategy board etc. The
government is also provides various Loan to SME for growth and business expansion such as
MUDRA loan, credit guarantee fund scheme, credit link capital subsidy scheme for up
gradation of technology. The SME gets the support from the government in the supply of
subsidized training of the employees for productivity improvement and simplify investment
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