Question

Study the following case/situation and express your opinion.

Mr. Ram wants to start Small Scale business of manufacturing parts of bicycle or machinery.

1. Identify the first step or stage of setting up his small-scale business.
2. Identify the sector in which Mr. Ram wants to start the business?
3. State any one advantage of a small-scale business.

Answer 1

1. Ram has to first decide whether the setup will be a corporation, a proprietorship, or a partnership. He has to identify his strengths and weaknesses, which can help him to decide what type of business would be most suitable. He has to study the amount of capital required to start his business. Once he gets the idea of the total capital requirement, he can decide what type of business to start.
2. Mr. Ram wants to start his business in the Industrial Manufacturing Sector. Under the Micro, Small, and Medium Enterprises (MSME) guidelines, his activity falls under manufacturing engineering goods, where raw materials are mechanically processed into finished bicycle parts or machinery components.
3. A key advantage is the large employment generation. Since small-scale units are predominantly labour-intensive, they utilise more manpower than heavy automatic machinery, creating immediate job opportunities for skilled and semi-skilled local youth with minimal capital investment.