Inability to access markets, retain customers top challenges for MSMEs: Report

financialexpress.com:

A majority of MSMEs surveyed cited the inability to access markets, retain customers, and effectively market their products are among the top challenges, according to an ICRIER report unveiled on Monday.The report surveyed a total of 2,007 micro, small and medium enterprises (MSMEs) between November 4, 2022, and January 20, 2023.

Of the total sample, 65 per cent of the firms were micro in size, 19 per cent were small, and the remaining 16 per cent were medium.The analysis from the survey suggests that MSMEs — which adopt e-commerce platforms as a sales channel — tend to be owned by younger and more educated individuals.A higher share of export-oriented MSMEs are found to be integrated with e-commerce platforms compared to firms that do not export, suggesting a positive relationship between firms’ export orientation and e-commerce adoption, the Indian Council for Research on International Economic Relations (ICRIER) said in the report.On average, integrated MSMEs appear to be better off than non-integrated firms on key performance indicators, such as turnover, profitability and share of employment benefits.At the time of the survey, 1,005 enterprises were already integrated with e-commerce platforms, while the remaining 1,002 were not integrated.

The survey findings suggest that integration with e-commerce platforms not only enables MSMEs to improve their access to the market but also access to finance, thereby alleviating critical barriers to their growth.”Thus, for MSMEs to be effective engines of inclusive growth, their digital transformation must be a priority,” the survey highlighted.”A vast majority of the surveyed enterprises reported that the inability to access markets, retain customers, and effectively market