Ease of Doing Business for MSMEs: MSMEs in India account for 11 crore jobs and 29 per cent of the country’s GDP. In 2021, restoring MSMEs’ financial momentum will be integral to providing the true GDP development price a large push. MSMEs will require to discover sales and distribution possibilities and obtain new techniques for company expansion. MSMEs will also have to rethink market place penetration and consumer outreach. Most importantly they will require access to straightforward and low-price credit. The most reputable way for MSMEs to realize an finish-to-finish exponential development will be to embrace the technologies enablement of their provide chain functions. B2B e-commerce platforms with their technological capabilities will companion MSMEs towards these targets with agility at scale in 2021.
Democratizing Technology Enablement for MSMEs
The basic explanation for low technologies penetration is the higher total price of ownership (TCO). The scenario will transform drastically in 2021 due to the government’s Rs 8000 crore BharatNET and FFTH applications that will provide low-price broadband connectivity to 150,000-gram panchayats across the nation. MSMEs will be capable to connect to B2B e-commerce platforms improved. B2B e-commerce models develop themselves on cloud-hosted applications that are scalable and hence give a higher degree of operating and monetary leverage. Such cloud applications from B2B e-commerce platforms that drive many transactions and automate diverse provide chain functions from sales distribution, analytics-primarily based consumer outreach, and provide chain finance will catch traction with MSMEs.
Growing MSMEs’ Sales and Distribution
The pandemic has demonstrated how offline and manual sales and distribution processes can drive a wedge amongst MSMEs and their enterprise prospects and hence make provide chain gaps. The government’s heavy-duty outlay of Rs 2.3 trillion in engineering a 5G optic fiber network across the nation will expedite MSME-B2B e-commerce partnerships in 2021. B2B e-commerce platforms will provide a price-effective and seamless digital interface amongst MSMEs and enterprise prospects in manufacturing and connect the former to more possibilities to sell greater and improved, thanks to the 5G digital infrastructure. MSMEs that enroll in B2B e-commerce ecosystems will have the scope to earn up to 51 per cent greater revenues annually than their offline counterparts.
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Enabling MSMEs to Expand Smoothly
Through the pandemic, some MSMEs have swiftly switched from the manufacturing of non-important goods to that of important goods. What has constrained other MSMEs from performing so is the higher proportion of variable expenses of offline company expansion routes. The governments’ CLCS-TUS initiative to subsidize technologies enablement in MSMEs will be a game-changer in 2021 amid the recovery from the pandemic. B2B e-commerce platforms will be capable to allow 60-80 per cent invest reduction for MSMEs by means of digital company expansion.
Enabling Superior Market Penetration, Customer Outreach
Offline modes of market place penetration and consumer outreach are not outcome-primarily based and hence boost dangers for MSMEs. With B2B e-commerce, MSMEs can attain a 70 per cent broader consumer base for domestic and international trade. The government’s initiative to invest Rs 27,300 crore in building the single-window e-logistics market place for MSMEs gives an fantastic chance for B2B e-commerce and MSMEs platforms to collaborate. B2B e-commerce platforms will allow MSMEs to penetrate deep into remote areas across the nation exactly where OEM prospects have faced challenges with the procurement of industrial supplies.
Assisting MSMEs with Supply Chain Finance
Delayed payments have been a supply of concern for MSMEs by means of the pandemic. While the government’s legislation to safe MSMEs’ payments inside 45 days is laudable, MSMEs require reputable quick-term provide chain credit sources. Banks have to adhere to due diligence to optimize the dangers of NPAs in their balance sheets and thus have to anchor MSME debt offerings to collaterals compulsively. On the other hand, B2B e-commerce platforms can use analytics and large information and make option danger assessment models. They can use digital capabilities to analyze MSMEs’ money flow, turnover, consumer portfolio, supplier ratings by major OEM prospects, and records of terrible-debts, if any, and provide agile provide chain credit to them.
Enabling MSMEs to be Self-Reliant
MSME units require to make their provide chain more rapidly, more price-effective, transparent, and safer rapidly. The intent of B2B e-commerce platforms in 2021 will be to integrate MSMEs in Indian manufacturing with international worth chains and safe a greater proportion of gross worth added in international manufacturing more than the lengthy term. B2B e-commerce networks can allow this by means of higher regional capacity utilization of MSMEs and unlocking new possibilities for domestic and international trade.
Rahul Garg is the Founder of Moglix. Views expressed are the author’s personal.