Plant : A building capable of manufacturing goods in large quantities
Equipment : Includes machines, vehicles etc...
MANUFACTURING SECTOR
SERVICE SECTOR
Cottage industries
[Rural / Traditional/ Home Industries]
An industry where the creation of goods and services are home based rather than factory based and specific skill is required is called a Cottage industry.
Features of Cottage Industries
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Organised by individuals with private resources
Family labour and locally available talent is used
Small capital investment
Produce simple products Usually no mass production
Administrative set up for SSI
Administrative set up for SSI consists of two ministries :
Ministry of Small Scale Industries – Nodal agency for formulation of policy and for the promotion and development of SSIs in India.
Ministry of Agricultural & Rural Industry – Nodal agency for coordination and development of village & khadi industries both in urban & rural areas.
State Governments execute different projects for development and promotion of SSIs through State Directorate of Industries and District Industries Centres (DICs)
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ROLE OF SMALL BUSINESS IN INDIA
SSIs are second largest employers of human resources, after agriculture.
They produce variety of products for the economy.
It provides greater opportunity for entreprenuership.
It is possible to take quick and timely decisions.
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PROBLEMS OF
SMALL BUSINESS
FINANCE
Non- availability of adequate finance to carry out its operations
Availability and Procurement of Raw materials is another major problem
MANAGERIAL SKILLS
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SSIs are generally promoted and operated by single person, who may not possess all managerial skills to run a business
Also not in a position to afford professional managers
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LABOUR
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Productivity per employee is relatively low and employee turnover is generally high due to low remuneration.
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Marketing is a weaker area of small organisations. Exploitation of middlemen is more.
Many small businesses do not follow the desired standards of quality due to shortage of finance and resources.
TECHNOLOGY
Most of the SSIs use outdated technology, resulting low productivity
SICKNESS
Due to many internal and external problems, most of the SSIs are in the edge of sickness
GLOBAL COMPETITIONS
Most of the SSIs face competitions not only from medium and large industries, but also from Multinational companies.
It was set up in 1982 to promote integrated rural development.
Apart from agriculture, it supports small industries, cottage and village industries and rural artisans by providing credit facilities.
RSBDC
The Rural Small Business Development Centre
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It was established for the benefit of Socially and Economically disadvantaged individuals and groups.
It provides management and technical support to existing and prospective micro and small entreprenuers in rural areas.
It was set up in 1955 for the promotion of small business units in the country by providing raw materials through raw material depots, export marketing etc...
It was set up as an apex bank to provide direct and indirect financial assistance under different schemes to meet credit needs of small business organisation
This programme was launched on May 1, 1978 to provide administrative framework at the district level.
It provides all services and support facilities to the entreprenuers for setting up small and village industries
Government offered various incentives to attract industries in rural and backward areas
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Land Power Water Octroi Finance
Setting industrial estates
Offer tax holidays (Exemption from paying taxes for 5 or 10 years)