The Micro, Small and Medium Enterprises (MSMEs) sector has traditionally been the backbone of our economy. However, over the past few years, the MSME sector has started confronting some challenges, including country’s shift to GST tax regime, lack of technological knowhow, inefficiencies in supply chain and difficulties in availability of funds.
Since businesses aided by technologies deliver better products and services, and save time and money, technological advancements play a critical role in shaping businesses.
This brought to light the need for MSMEs to adopt digital technology enabled platforms as a solution to challenges being faced by these firms. To support this, the government has launched the Digital MSME scheme in 2017, that involved providing training to MSMEs and enable them to overcome the hurdles in digital transformation.
Digital Transformation is a new force that has fundamentally changed how MSMEs operate and deliver value to customers. It has led to smart integration of digital technologies, processes and competencies across all levels and functions.
MSMEs must embrace digital tech to stay afloat
The micro, small and medium enterprises (MSMEs), which have borne the brunt of the COVID-19 pandemic should embrace digital technologies to stay in business and emerge competitive in the post-COVID world.
MSMEs must transform the way they function to be able to continue to produce goods and services during this turbulent time. This can be done by adopting technologies which will not only allow MSMEs to reduce onsite labours but also help them to control their process digitally.
That’s because digital transformation makes businesses more transparent and efficient. It provides opportunities to enhance the customer satisfaction and build great working environment. Resultant, MSMEs can accelerate growth, optimise operations, and create value across organisation. Also, it helps small businesses embrace new technologies to improve their manufacturing process and improve ROIs.
Digital trends in the COVID scenario
Customers are willing to shop online for categories like accessories, appliances, apparel and footwear, OTC medicines, snacks, electronics, groceries, etc. Approx. 14% consumers across these categories switched across brands for the convenience of online shopping, with a 50% intent to continue.
This highlights the importance of bringing your small business online, and taking your offerings to customers who are getting accustomed to shopping online.
In addition to this, there is a rise in adoption of digital sales channels, which implies that digital interactions will hold greater importance instead of traditional interactions in the post COVID world.
According to a survey conducted by an IT company Endurance International Group (EIG), about 30% of MSMEs started a business website or enabled e-commerce functionality since the lockdown started owing to the COVID-19 pandemic. More than 50% of MSMEs started using video conferencing tools and WhatsApp to keep business running.