SME Challenges: The Low-Value Trap
Multiple Internal Challenges prevent SMEs from accessing the capital and know how required to reach scale. This affects profitability - which in turn poses a risk to their survival.
Absence of scale threatens sustainability
Break Out:
Sustainable expansion requires simultaneous work on all aspects of the business.
Know-How must accompany Capital.
Building Scale:
Philosophy:
Businesses need to transform to register sustainable growth.
Businesses transform in discrete steps or orbital jumps.
A successful orbital jump requires that all relevant activities progress in a synchronised manner. Omissions result in sub-optimal Outcomes and a waste of resources.
Broad Approach:
Identify distinct stages of business transformation.
Enumerate activities and necessary conditions for implementing each stage of transformation.
Determine resource requirements.
Organise Resources.
Related Reading:
SMEs contribute to over 30% of India’s GDP, 45% of industrial production, 40% of export and employ over a 100 million. SMEs face significant challenges on account of their size.