The State Government of Kerala is aiming to set up the most extensive integrated start-up complex in this country by the end of 2019. The complex is set to be spread across 13.5 acres and provide high quality infrastructure for the start-ups. The government has already invested over Rs. 100 million to promote ventures with innovative ideas in the state.
Furthermore, various financial institutions are now offering business loans in Kerala to enhance the start-up environment and to aid individuals who are looking to start their venture.
Small businesses are crucial as they provide significant opportunities for budding entrepreneurs to start their business and generate more job opportunities subsequently.
Importance of small businesses
Potential to increase job opportunities
Small scale industries are labour intensive. They provide an opportunity to create employment opportunities on a massive scale. They require more labour than other big industries as they involve considerable manual operations. Hence, in a labour abundant state like Kerala, such ventures are significant.
Requirement of less capital
Small scale businesses require considerably less capital compared to the big industries. The Government has initiated various schemes for these ventures to avail funds. Also, these firms can easily avail a business loan in Kerala to meet the required expenses.
The products and services offered by these firms contribute to a significant portion of the industrial production in Kerala. The goods provided by these ventures are considerably affordable, so it caters to a massive number of consumers in the state.
Also, they have the liberty to control their production according to demands. With the help of proper inventory management techniques, they can easily increase their profit margin by avoiding overstocking.
These industries contribute nearly 40% of the total amount of exports of India. There are various quality products manufactured by such sectors that are exported to multiple countries. Hence, they earn valuable foreign exchange.
Also, small businesses requiring funds to expand their venture and start exporting can easily do that by availing a business loan in Kerala from any leading NBFC.
Small businesses can build stronger relationships with customers, employees and suppliers. It provides the scope for person-to-person communication that is crucial for expansion.
Building interpersonal relationships is an exceptional way to become a successful small business owner in Kerala.
Flexibility to react to various challenges
A small business consists of a simple chain of command. On the other hand, large companies come with a set method of operations that are hard to alter in case of any unforeseen scenarios that can arise. However, smaller businesses are far more flexible. They can react to such situations with the help of quick decisions.
Lower overhead costs
Small scale ventures require a lower overhead compared to the big firms. The primary reason behind this nature is low scale operations. This low overhead cost results in products at lower prices for the customers.
Also, it increases the life cycle of working capital that ensures the smooth running of a company.
Catering a customer base for a specific niche
Large firms with massive overhead costs are required to produce a high output level to spread the expenses they incur. On the other hand, smaller firms can make a profit with a comparatively fewer sales figure.
Also, they have the opportunity to easily expand their business to meet the requirements of a different set of the target audience. For this expansion, they can avail a business loan in Kerala to meet such needs. However, they are required to ensure that they avail a loan from a lender that offers a high credit amount that meets their requirements.
Bajaj Finserv is one such NBFC that offers a Business Loan of up to Rs. 30 Lakh with tenors ranging between 12 and 60 months.
These points highlight the importance of owning a small business in Kerala. Make sure that you meet the business loan requirements to avail credits when needed.