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Problems and Prospects of Small Scale Industries - A Case Study of SPSR Nellore District in Andhra Pradesh
*Dr. G. Malyadri1,** Dr. B. Rambabu2 ,*** B. Sudheer Kumar3 *1 & **2 Associate professors, Dept of MBA Sreenivasa Institute of Technology and management Studies (SITAMS). Chittoor, A.P., ***3 Assistant Professor, Dept of MBA, Sreenivasa Institute of Technology and management Studies (SITAMS). Chittoor,A.P,
ABSTRACT Small scale industries play an important role in the national economy. The central and state government has taken active steps to promote and foster their growth. Many of the problems like financing of raw materials, marketing, labor, storage, transport and technology still continue to afflict the small scale industries while same of them are more of less common to a wide range of small industries others have particular relevance to a group of small industries and industries situated rural and seek used areas. Inspite of vigorous efforts being made to promote small scale industries sector as a matter of policy suffers term some problems which require special attention. So that the growth rate of thin sector can be accelerated so as to ensure that it becomes a patent and effective instrument for bringing about economie federalism in the true sense of the term. Keywords: Sampling Design, Operational Problems of Sample Units, Financial Problems, Marketing Problem, Raw Material Problem, Operational Problems of Sample Units. INTRODUCTION The problems of small scale industries seem to remain unsolved due to division of tends granted, administrative lapses, empathy on the part of the entrepreneurs to make use of the benefits provided under various schemes. The problems encountered by small sick industries, way from region to region, category to category and time to time. Several research studies have been mode on the vital issues inspiring of small scale industries. These studies covered various issues of small scale units at national and regional levels. Moreover, in a vast country like ours, with varied resource, bases and socio economie conditions, there is a need for more number of area specific studies to economie the factors contributing to the growth and development of small scale industries. In this contract the present research study relating to small scale industries of select manufacturing units and the role of syndicate bank in SPSR Nellore District. RESEARCH METHODOLOGY SOURCES OF DATA: The study is based on both primary and secondary data. The secondary data has been drawn from on the reports on small scale industries in India. Plan documents, plan reports, statistical abstracts of India and Andhra Pradesh. The primary data has been collected by field studies. Two different questionnaires were prepared and pre-tested one for a small secle units and another for syndicate bank branches are located at SPSR Nellore District. SAMPLE DESIGN: These units were selected by a two stage scripling procedure. Small scale units which are financed by the syndicate bank are selected in the first stage. All the 38 syndicate branches have been chosen for the survey. Out of 13,445 small scale industries in the district, 1661 units are financed by the syndicate bank. For the purpose of selection of sample units, all these small scale industries are classified into eight categories of industries Viz.., Agro based, forest based, textile based, mineral based, Engineering based, chemical based, leather based and Miscellaneous categories. 250 units have been selected on the basis of stratified random sampling giving equal importance to each of these eight categories of units in the second stage. The sample

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G. Malyadri, B. Rambabu2 ,B. Sudheer Kumar| Problems and Prospects of Small Scale Industries - A Case Study of SPSR Nellore District in Andhra Pradesh
works out to 15 percent of units in each category. The sampling design is presented in the following table. SAMPLING DESIGN
S. CATEGORY OF FINANCED & NO. OF NO UNITS SSI UNITS BY UNITS SYNDICATE SELECTED BANK AS SAMPLE

Chemical based

- 2

Engineeri 17 17 ng based Leather based Others 41 35 6

- 4 10 3

- 17

- 40 1

- 41

1 2 3 4 5 6 7 8

Agro Based Forest Based Textile Based Mineral Based Engineering based Chemical Based Leather Based Miscellaneous Total

266 73 264 113 206 27 273 439 1661

40 66 66 - 46 20 - 66 11 40 17 31 4 41 66 250 18 53 1 17 53 49 74 26 15 0 (2 7 8 (2 (2 (3 (1 0 (7 1) (7 (5 1) 0) 0) 0) (6 2) ) 9) 0) Note: - Figures in parentheses are percentages total VS= Very Serious S= Serious NS= Not Serious FINANCIAL PROBLEMS: Finance appears to be a major constraint for the smell scale industries located in SPSR Nellore District as per the present study. It is evident from the table that out of total 250 units, so units (72 percent) expressed finance as a very serious problem only 17 units have reported (7 percent) finance is not a constraint. 93 percent of sample units are confronted with the problem of inadequate finances, particularly for meeting their working capital requirements. All the sample units have reported that they have availed financial assistance either from banks or kahadi and village industries board, SPSR Nellore district. MARKETING PROBLEM: Marketing appears to be a second important problem for small scale units of SPSR Nellore district. 20 units (80 percent) reported positively in this regard. All the units of leather based 16 units out of 17 in mineral based, 10 units out of 40 of textile based, all the units of chemical based, 14 units agro of 17 in engineering based, 34 units out of 40 in agro based, 10 units out of 11 in forest based and all the units in miscellaneous categories encountered marketing problem taking all the sample units in to consideration, 80 percent of the unit are observed to be experiencing marketing problems. RAW MATERIAL PROBLEM: 1 2 5 10 It can be observed from the present study that the availability of raw material does not seen to be a problem for 150 units (60 percent) of sample units. Out of 100 units, the problem is very serious in 74 units (30 percent) and somewhat serous in 26 units (10 percent) units. All the respondents of leather based, chemical based and engineering reported that procuring raw material is not a problem. 8 units out of 40 in textile

Source: Field Survey. The main objective of this study is to cover same of the important problems which are specific to sample units of the SPSR Nellore district. The operational problems of sample units are presented in the following table. TABLE 2 OPERATIONAL PROBLEMS OF SAMPLE UNITS Tot S. Category al Finance Marketin Raw No Avg g material Uni ts VS S N VS S N V S N S S S S 1 Agro 40 30 6 4 28 6 6 5 10 25 based 2 Forest based Textile base Mineral based 11 2 7 2 7 3 1 1 2 8

40

2 28 1 6 0

4 30 -

8 32

17 12 4 1 15 1

Electrical 14 12 2 and Electronic s

1 13

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G. Malyadri, B. Rambabu2 ,B. Sudheer Kumar| Problems and Prospects of Small Scale Industries - A Case Study of SPSR Nellore District in Andhra Pradesh
based, 15 out of 40 respondents in agro based, 7 out 17 respondents of mineral based 3 units out of 11 in forest based and all the units of miscellaneous (66 units) reported availability of raw material as a problems. TABLE -3 OPERATIONAL PROBLEMS OF SAMPLE UNITS TOT S. CATEGO AL STORAG LABOU TRANSP NO RY AVG E R ORT UNI TS V S NS V S NS VS S NS S S 1 Agro 40 4 6 30 3 8 29 - - 40 based 2 Forest based Textile based Mineral based 11 7 1 3 3 1 7 6 5 storage as severe constraint as they undertake production in anticipation of demand. LABOUR PROBLEM As the small scale industries are labor will not arise. This is evident from the fact that out of 250 sample units of the present study in SPSR Nellore District; only 45 units (18 percent) expressed it as a severe problem. This problem is noticed only in the case of forest based. Leather based, chemical based engineering based and electrical and electronics based as they case hired labor to carry on their industrial activity. For 148 units (59 percent), labor is not constraint. TRANSPORT PROBLEM In SPSR Nellore district, transportation is a problem to 91 units (36 percent) filling under the categories of minerals based. Electrical and electronics, miscellaneous and forest based industries and for the rest of the sample units it does not appear to be a problem at all. CONCLUSION It is evident from what is discussed above that all small scale industries are affected with a multitude of problem. It is true that there are some variations in the nature and extent of the problems experienced by the different small scale. Industry groups. There are going variations among the different sample units within the same industry group and also in the matter of extent and nature of the problems they are confronted with. It is high time that feasible was and means are found out to overcome these problems without further loss of time. It is only then that we can visualize a bright and a prosperous future for the small scale industries in SPSR Nellore district. While there are some industry specific problem in these industries. There are problems of financing and marketing which seems to be common to all of them. The solution seems to provide adequate and on time finance, containing diversion of funds sanctioned, called the leakages and providing enough grading, storing and transport facilities to market them at appropriate times. REFERENCES [1] Asher Ram Singh. K. 1987: Small scale and cottage industries in India, in uppal, Josoed; Indian economic problems New Delhi, Tata Yc- Grow Hill Versant desai, small scale industries and entrepreneurship Himalaya publishing House, 2002, Mumbai, P-279 Desai, S.S.M, 1998; Industrial Economy of India New Delhi; Himalaya Publishing House.

40

2 7 31 -

- 40 -

- 40

17

- 17 -

- 17 -

Electrical 14 14 and Electronic s Chemical 4 1 2 based

- 4 10 - 10 4

1 1 2

7 Engineerin 17 g based 8 Leather based Others 41

- 14 3 5 12 -

- 17

- 41 -

- 30 11 -

- 41

66 33 33 - 33 - 33 - 66 -

61 10 85 45 57 14 - 91 15 (2 4 (34 (1 (22 8 (36 0 4) (42 ) 8) ) (59 ) (64 ) ) ) Note: 1. Figures in parentheses are percentages to total 2. VS= Very Serious S= Serious NS= Not Serious Source: Field Survey STORAGE PROBLEMS It can be observed from the table 3 that only 61 units ( 24 percent) spread over 4 units in agro based, 7 units in forest based, 2 units in textile based, all the units in electrical and electronics (14 units), 1 unit in chemical based and 33 units in miscellaneous industries reported

[2]

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G. Malyadri, B. Rambabu2 ,B. Sudheer Kumar| Problems and Prospects of Small Scale Industries - A Case Study of SPSR Nellore District in Andhra Pradesh
[4] Butte Andrew and Manjeesh K. Singh, 2003, Contribution of SSI Sector in Indian Economy ICFAI Journal of Applied Economics, Volume 11(4), Novemeber Ghosh Arun 1998; Government policies concerning small scale industries an appraisal. [6] Suri K. B. ed; small scale enterprises in industrial development; the Indian experience, New Delhi ; Sage publications, p-318-319. Karve committee, 1955, Report of the village and small scale industries, Ministry of small scale industries. Sandesava J.C. 1991; New small enterprise policy ; implications and prospects, Economic and political weekly, p-24-26.

[7]

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