Digitally integrated firms have higher turnover, profitability and employee share: Survey

economictimes.indiatimes.com:

MSMEs and large firms, digital technology is a leveller for small enterprises, according to a pan-India survey done by the Indian Council for Research on International Economic Relations (ICRIER).

The survey’s findings — which were released on October 9 in the report Annual Survey of Micro, Small, and Medium Enterprises (MSMEs) in India: Leveraging e-Commerce for the Growth of MSMEs — showed low awareness among MSMEs with regard to the benefits of integrating their operations with e-commerce platforms. Policymakers have to roll-out a multi-pronged strategy to change the status quo, it said.

Mentioning some of the key benefits of leveraging e-commerce platforms for MSMEs, Radikha Kapoor, Professor at ICRIER, said, “E-commerce platforms have been found to enable them (MSMEs) to access wider markets, boosting their sales and revenue.

They are also able to do this at a lower cost than they would have had to pay if they had no access to such a platform. MSMEs on e-commerce platforms are also able to get quality feedback about their products, which enables them to improve the products.

They are also able to make use of better training, skill development and mentorship programmes. Of course, the survey also has evidence that integrating with e-commerce platforms facilitates access to finance for small businesses.”

The survey found that the size of a firm was a factor in e-commerce integration.

As many as 615 of the 1,310 micro firms that were surveyed; 259 of the 383 small firms and 131 of the 3,414 medium companies that participated in the survey were using e-commerce to grow business. Also, women-owned MSMEs were not far behind male-owned ones in integrating with e-commerce platforms; 50% of women-run companies were