Essay: Challenges Faced by SMEs - Financial, Marketing and Technology

This essay analyzes the significant challenges faced by Small and Medium Enterprises (SMEs) in the current globalized business environment. The introduction sets the stage by highlighting the resource scarcity SMEs experience compared to larger firms. The body of the essay delves into three primary areas of difficulty: financial credit challenges, marketing challenges, and the lack of advanced technologies. The financial section discusses the difficulties SMEs face in securing loans, including complex securities, payment delays, and high-interest rates. The marketing section explores how larger companies dominate marketing spaces, leaving SMEs struggling to compete due to budget constraints and visibility issues on major platforms. Finally, the essay examines the technological disadvantages SMEs face, hindering their ability to reduce costs and improve product quality. The conclusion emphasizes the need for government support to help SMEs navigate these challenges and compete effectively in the global market. The essay includes references to support the arguments presented.

ENGLISH COLLEGE
WRITTING

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Challenges Faced by SME
(A)INTRODUCTION
In the time of globalisation, there are many problems faced by the SME especially due to lack
of resources when compared with bigger firms. Essay will include the financial challenges
faced by the SME. Marketing challenges faced by the company. It also illustrates the
challenges related to availability of the advanced technologies.
B) Body
i. Financial credit challenges faced SME
a) In the time when the financial condition of the world is not so stable, getting financial
credits have become a major challenge for the company. SMEs are confronting
circumstances of complex securities by the banks, payment delays and high interest
rates on the credits given to SME. Since Central banks are facing financial challenges
in maintaining the economy of the nation hence this problem widens. For example in
India, Banks charge interest rates of 10-20%, this is very high in the time when
demand and supply gaps is fluctuating very fast and companies are unable to fulfil
this gap (Kumar, 2019).
b) https://www.thehindubusinessline.com/opinion/Challenge-of-financing-SMEs/
article20254951.ece
ii. Marketing challenges faced by SME
a) Bigger companies have higher resources hence they have taken control of the larger
part of the marketing space on every platform. SMEs are unable to compete with them
with the linkages they have in the market. There are no separate platforms for the
SME and they are constantly obliged about the shortage of budget. Since SMEs also
have to utilise the same platforms where bigger companies are doing their promotions
hence they are unable to place them better than their rival having larger amount of
resources (Lundin, 2018). For example SMEs have poor visibility on the bigger

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platforms such as results of the search engines; this is because bigger companies use
their knowledge base and resources to promote their advertisements on the top.
b) https://www.advertisingweek360.com/the-5-biggest-small-business-marketing-
challenges/
iii. Lack of advanced technologies available with SME
a) In the era of technology based business, due to lack of advanced technologies these
companies are not able to compete with products of the larger firms. This is because
technologies helps in reducing the cost of the products and also helps in improving the
quality of the products they are delivering (Melanie, 2018). This is because SMEs are
still dependent on the human resource so as to get their tasks done hence efficiency of
their operational management is still under the question mark.
b) https://www.unleashedsoftware.com/blog/technology-challenges-small-medium-
sized-enterprises
Conclusion
SME are facing lots of challenges due to the resource scarcity in front of bigger firms.
Central banks are not giving easy loans to the SME due to the poor performance of the
market. These SME are also facing challenges in the marketing as these SMEs also have the
same platform to compete from which is not possible to excel without support of similar
resources that bigger firms have. SMEs also lack in terms of advanced technologies they have
and it is reducing the overall efficiency of the firm. It can be said that SMEs need a support of
governments all across the globe so that they can also face the challenges posed by the
globalisation.

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References
Kumar, A. (2019) Challenge of financing SMEs. Retrieved from:
https://www.thehindubusinessline.com/opinion/Challenge-of-financing-SMEs/
article20254951.ece
Lundin, K. (2018) The 5 Biggest Small Business Marketing Challenges. Retrieved from:
https://www.advertisingweek360.com/the-5-biggest-small-business-marketing-
challenges/
Melanie, (2018) Technology Challenges for SMEs. Retrieved from:
https://www.unleashedsoftware.com/blog/technology-challenges-small-medium-
sized-enterprises