Around 63 million MSMEs exist in India, employing around 11.10 crore people. It accounts for 22% of total employment in the country. The pandemic, however, has had a substantial influence on the expansion of various micro to medium firms, with 17% of India’s MSEs shutting owing to low demand and geographical constraints. MSMEs must focus on digitalization to overcome these obstacles.
MSMEs’ digitization has had a favorable influence on company growth. “MSMEs digitization is one of the wisest solutions to almost all issues,” stated the Indian MSME minister. Furthermore, it assists small enterprises in being more transparent, result-oriented, and time-bound.” However, 90% of MSMEs have yet to implement digital solutions. These firms are transforming at a snail’s pace.
Benefits of Digitization
Digitization may help streamline business processes, boost efficiency, and reach a broader audience, resulting in greater value and productivity, revenue growth, and GDP contribution. According to a CISCO APAC SMB Digital Maturity research, 50% of MSMEs that use automation solutions can contribute up to 3.1 trillion USD to Asia Pacific GDP by 2014.
Essential Areas MSMEs Must Focus on Digitization:
For technological growth, MSMEs must prioritize five essential areas: finance, project management, marketing, security, and customer engagement and interaction.
- Finance: In order to survive and flourish, we require finance. To receive appropriate support, it is necessary to enlist in several government projects such as MUDHRA. Reliable fintech businesses may also assist MSMEs in obtaining finance at low interest rates.
- Project management software and solutions enable an organized workflow with maximum efficiency. Asana and Trello are two project management software that aid in team management, project workflow management, and much more.
- Marketing: MSMEs must prioritize digitizing marketing activities in order to reach a larger global audience. Social media handles like Facebook, WhatsApp, Instagram, and Pinterest assist engage and nurture an audience, resulting in increased sales and conversion rates.
- Security: Efficient security systems in the workplace guarantee that liabilities, compensation, and costs are kept to a minimum. To create a safe and secure company environment, install antivirus software and collaborate with cybersecurity specialists.
- Customer Engagement & Interaction: In service-based organizations or eCommerce, customer interaction and engagement are critical. Chatbots, review sites, websites, email marketing, contact forms, forums, and social media are all being used by organizations to improve consumer connection. Businesses should prioritize customer involvement in order to get customers to buy more and more.
Digitization may boost business growth, and MSMEs must prioritize technology innovation to address the hurdles provided by the pandemic and low demand. MSMEs may enhance their company operations and raise their chances of success in a hard economic situation by implementing digital tools and solutions.