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57% of the MSME owners struggle to get new orders for their merchandise: BYST Report

Ease of Doing Business for MSMEs: Twenty-seven per cent of the entrepreneurs said they find it challenging to make timely repayment of loan installments, finds the survey conducted by Bhartiya Yuva Shakti Trust (BYST).

Ease of Doing Business for MSMEs: The economic condition of MSMEs is yet to stabilise even though the demand has been consistent post the pandemic. Almost 57 per cent of the entrepreneurs expressed concern over getting new orders for their products or services, finds the survey by Bhartiya Yuva Shakti Trust (BYST), an NGO that mentors youth for entrepreneurship. 

The survey done in October 2022 covered 5,685 micro-enterpreneurs from states including Haryana, Rajasthan, Uttrakhand, Odisha, Jharkhand, Tamil Nadu, Telangana, Andhra Pradesh, Maharashtra, Assam and New Delhi.

Operating capital crunch was another perennial issue that got highlighted in the survey. Twenty-seven per cent of the entrepreneurs said they find it challenging to make timely repayment of loan installments. Another 20 per cent of the respondents said that they find it difficult to arrange raw materials for production and nine per cent of them are concerned about the increased cost of production. 

The average investment of these businesses is around Rs 6 lakh which underlines their low capital size, and vulnerability to external factors such as demand slowdown, the report noted. 

“Lesser purchasing power of consumers lead to reduced demand and increased raw material cost due to higher transportation cost with increase in fuel prices have been cited among key problems faced by entrepreneurs during the last 27 months,” said Lakshmi Venkataraman Venkatesan, Founding and Managing Trustee, Bhartiya Yuva Shakti Trust (BYST). 

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The study further highlighted that 14 per cent of the women entrepreneurs surveyed found operating a business difficult. Out of these, 72 per cent of women find marketing of their products challenging and 26 per cent of them found delayed payments to be a deterant. 

“Women entrepreneurs need special mentoring and upskilling. Their inability to move around during odd hours, travel to other cities and lack of skilling in using digital marketing tools restrict them in growth of their business,” said Venkatesan.