Adoption of online markets and sales platform has increased
Digitalisation has gained traction, and SMEs in India have been increasingly adopting technology and digital solutions to enhance their competitiveness, according to a survey by FICCI.
The adoption of technology includes the use of e-commerce platforms, digital marketing, cloud computing, and automation tools, according to FICCI survey, ‘Report on SMEs in India’.
The survey of more than 600 SMEs across 14 cities, followed by focused group discussions, reveals that SMEs have been utilising digital technology across different business functions, with 60% of enterprises using digital tools for human resources, 51% for sales and marketing and 48% for finance.
The accounting software (such as Tally/ Vyapar/ Busy, etc.) and business applications like ERP and CRM were reported to be the most used digital tools by SMEs, FICCI said on 19 Oct in a release on the survey.
“What is noteworthy is that about 37% of enterprises surveyed were also using cloud-based business applications such as IaaS, PaaS, SaaS, among others,” the survey noted.
Most of the firms have experienced improvements in productivity and reductions in operational costs as a result of incorporating digital technology into their business functions. Approximately 35% of respondents reported a reduction in their annual operational costs by 11-20% as a result of digitalisation. Another 30% of respondents indicated that their annual operational costs had decreased by more than 20%.
SMEs have also been leveraging e-commerce platforms and online marketplaces to reach a larger customer base and expand their market presence. These platforms provide opportunities for SMEs to showcase and sell their products nationally and globally. In terms of online markets and sales platforms, a significant 71% of participating enterprises had their own online channels or sales platforms (such as a website to display or sell products).
Amongst the enterprises that reported selling through online channel(s), 24% reported that more than half (50% to 75%) of their overall sales came through online platforms like e-commerce platforms or own website. Another 39% respondents reported that one fourth to half of their sales were through such online platforms.
The adoption of online markets and sales platform has increased their sales, profits as well as reach to customers.
The study also brings to fore some of the key challenges faced by SMEs in integrating technology in business functions, especially in on-boarding on e-commerce platforms.
About 40% of respondents highlighted lack of skilled resources and technological expertise required to effectively integrate and operate these technologies, as well as limited knowledge of business-specific technology solutions.
While there is a government scheme “Digital MSME” as a part of the Champions Scheme to promote digital adoption amongst MSMEs enterprises, there is perhaps a need to create greater awareness about the scheme and its utility to the SMEs across India, says the survey. Fiinews.com
