Indian SMEs focusing on innovation, efficiency for driving revenue growth; funds a challenge: Survey
Indian SMEs are going 'back to basics' with a focus on growing current market share, increasing operational efficiency and maintaining current company strengths to unlock growth in 2018.
New Delhi: India's small and medium businesses are using their advantages such as size, agility and innovation as their top three strategies for driving revenue growth in 2018, says a survey.
However, 42 percent of 300 Indian small and medium enterprises (SMEs) — which participated in the survey, said that getting access to finance to grow the business is difficult, compared to 33 percent respondents globally. These Indian SMEs are also getting finance at higher rates as compared to global counterparts.
The second edition of the American Express Global SME Pulse 2018 further said that SMEs are looking at embracing responsible business practices as a way to attract more customers.
It said Indian SMEs, like their global counterparts, are going 'back to basics' with a focus on growing current market share, increasing operational efficiency and maintaining current company strengths to unlock growth in 2018.
"Our research shows that India's smaller enterprises are primed for success in 2018 by balancing revenue growth with efficiency improvements and leveraging unique attributes of agility, innovation and strong customer relationships. The Indian SMEs are now placing equal priority embracing responsible business practices to attract more customers," Saru Kaushal, vice president, global commercial services, American Express Banking Corp.
Rising borrowing costs and access to finance is making the SMEs to look at alternate options of raising funds to fuel their ambitious growth, Kaushal said.
"Our research shows that just 46 percent of the Indian SMEs say that they are satisfied with the current financing options available to them, highlighting the time-consuming application process, high interest rates and hidden fees as the top pain points," she said.
At a macro-level, she said, 78 percent of the Indian SMEs recognise that the SMEs play an important role in their country's economy and Indian SMEs also foresee high revenue growth over the next three years of 7 percent a year, along with a 6 percent annual growth in profits (both very slightly higher than the global average).
Another emerging theme from this year's report is how the SMEs across the globe are also embracing responsible business practices as a way to attract more customers, it said.
Worldwide, customers are demanding more ethical and sustainable products and services, it added.
American Express has partnered with Oxford Economics to survey the SMEs from around the globe to understand the threats they face and the business opportunities and strategies they will take advantage of in the year ahead.
Overall, in the telephonic survey participated 3,000 owners, executive board members of SMEs with between 10 and 250 employees and revenues of up to $30 million.
Google held a special event today in India called Digital Unlocked. At the event, Google CEO Sundar Pichai announced a new initiative which focuses on giving a boost to small and medium businesses in India.
Google's India-born CEO Sundar Pichai is all set to address a domestic technology market with a focus on small and medium businesses in the country on Wednesday.