Publication - The Financial Express
Edition - Online
Small and Medium Enterprises (SMEs) hold a paramount position in furthering India’s economic growth and employment generation. With the advent of transformative technological advancements in recent years, the business landscape has witnessed remarkable shifts, presenting a unique set of challenges and opportunities for these dynamic entities. The year 2020 witnessed a staggering presence of approximately 6.33 crore MSMEs, making significant contributions to the nation’s GDP, accounting for approximately 30 per cent thereof, and employing over 11 crore individuals. Spanning across diverse sectors such as manufacturing, services, and trade, these enterprises are now poised to harness the potential unleashed by initiatives focusing on enhanced market access, streamlined digital transactions, improved credit accessibility, data-driven insights, and collaborative ecosystem facilitation. By embracing these digital imperatives, MSMEs are primed to flourish amidst the rapid evolution of the digital landscape, charting a path of sustainable growth and prosperity.
Power of digitization for MSMEs - Digitization has the potential to transform MSMEs by streamlining processes, improving efficiency, expanding market reach, and thereby enhancing customer experiences. By adopting digital tools and platforms, businesses can automate tasks, reduce operational costs, and access valuable data insights for informed decision-making enabling themselves to compete on a level playing field with larger enterprises and tap into global markets.
ONDC: Accelerating Digital Commerce - ONDC is a game-changer for MSMEs, aiming to create an open and inclusive digital commerce ecosystem that empowers businesses, especially small-scale entrepreneurs. ONDC provides a unified platform that connects various stakeholders in the digital commerce value chain, including manufacturers, suppliers, logistics providers, and consumers. In the near future, with this intervention, MSMEs can set up their digital stores and reach a wider customer base. The platform offers features like secure payments, logistics support, and customer analytics, enabling businesses to deliver a seamless and personalized shopping experience. Moreover, ONDC facilitates collaboration between MSMEs, fostering partnerships and driving innovation across sectors. For the growth and expansion of MSMEs, it is crucial to have access to credit. Traditional banking systems often pose challenges for small businesses due to complex processes and stringent eligibility criteria. This is where OCEN comes into play. It is an open and interoperable credit enablement network that aims to simplify and democratize credit access for MSMEs. OCEN allows MSMEs to build their credit profiles based on their digital transactions and business history. By leveraging this data, the network enables lenders to assess creditworthiness more accurately and offer tailored financial solutions to businesses. This opens up avenues for MSMEs to access affordable credit, fuel their growth, and invest in technological advancements. With ONDC, MSMEs can set up their digital stores and reach a wider customer base. The platform offers features like secure payments, logistics support, and customer analytics, enabling businesses to deliver a seamless and personalized shopping experience. Moreover, ONDC facilitates collaboration between MSMEs, fostering partnerships and driving innovation across sectors. By leveraging this data, the network enables lenders to assess creditworthiness more accurately and offer tailored financial solutions to businesses. This opens up avenues for MSMEs to access affordable credit, fuel their growth, and invest in technological advancements. By having access to capital, businesses can seize new opportunities, expand their operations, and hire more employees.
Digital-first approach for MSMEs - MSMEs should prioritize digital transformation by digitizing their operations, processes, and customer interactions. This includes setting up user-friendly websites, optimizing online presence through search engine optimization (SEO), and utilizing social media platforms for marketing and customer engagement. By establishing a strong online presence, MSMEs can reach a wider audience and attract potential customers. A well-designed and user-friendly website acts as a virtual storefront, enabling businesses to showcase their products or services effectively. Implementing SEO techniques ensures that the website ranks high in search engine results, driving organic traffic and increasing visibility.
Utilize ONDC’s features - ONDC offers a range of features and tools that MSMEs can leverage to enhance their digital presence and customer experience. By creating compelling product listings, including detailed descriptions and high-quality images, businesses can attract and engage potential customers. Additionally, ONDC provides secure payment gateways, enabling smooth and hassle-free transactions. It also offers logistics support, ensuring efficient order fulfilment and timely delivery. By taking full advantage of these features, MSMEs can provide a seamless and convenient shopping experience, thereby building customer trust and loyalty.
Leverage customer analytics - One of the key advantages of digitization is the availability of valuable data insights. MSMEs should utilize the customer analytics provided by ONDC to understand customer behaviour, preferences, and purchasing patterns. By analysing this data, businesses can tailor their products or services to better meet customer needs and preferences. Customer analytics also enable businesses to identify emerging trends and adapt their strategies accordingly. This valuable information allows MSMEs to make data-driven decisions, optimize marketing campaigns, and personalize customer interactions, resulting in improved customer satisfaction and increased sales.
Foster collaboration and networking - ONDC serves as a platform for collaboration and networking among MSMEs, suppliers, and other stakeholders in the digital commerce ecosystem. By actively participating in this collaborative environment, businesses can forge partnerships, share resources, and access new market opportunities. Collaboration with other MSMEs can lead to economies of scale, reduced costs, and increased market reach. By working together, businesses can combine their strengths, leverage each other’s expertise, and create innovative solutions that benefit the entire ecosystem.
Build strong credit profile with OCEN - Access to credit is a vital factor in driving the growth and expansion of MSMEs. OCEN provides an opportunity for businesses to build a strong credit profile based on their digital transactions and business history. By maintaining a consistent revenue stream and timely payment of digital transactions, MSMEs can establish their creditworthiness. A robust credit profile enhances the chances of obtaining affordable credit options from lenders. MSMEs can use these funds to invest in infrastructure, upgrade technology, and expand their operations. This, in turn, fuels growth, increases productivity and enables businesses to seize new opportunities in the digital market.
Foster culture of innovation - Digitization opens doors to innovative solutions and approaches. MSMEs should foster a culture of innovation within their organizations, encouraging employees to think creatively and explore new ideas. By creating a supportive environment that values experimentation and rewards innovation, businesses can uncover new opportunities and stay ahead of the competition. This can involve initiatives such as setting up cross-functional innovation teams, hosting ideation sessions, and encouraging employees to share their insights and suggestions. Embracing innovation can lead to the development of unique products, services, and business models that resonate with customers and drive growth.
Please click on the link below: