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Justify the following statement. Small Scale Industries have problems. - Organisation of Commerce and Management

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Answer in Brief

Justify the following statement.

Small Scale Industries have problems.

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Solution

Small scale industries have to face many problems:

  1. Lack of Adequate Finance: Due to the small scale of production and sale, Banks and Financial Institutions are afraid to give loans.
  2. The problem of Raw material: Due to inadequate finance they cannot purchase raw material at a time Thus, the cost of raw material increases.
  3. Labour Problem: Due to inadequate finance, they cannot employ skilled labour which affects production.
  4. Marketing Problem: The goods manufactured if not marketed properly can be risky as it will affect the sales.
  5. The problem of Transport: Transportation cost increases the cost of the product which hampers the sale as large scale industries cost may be less.
  6. Sickness: Due to financial problem industrial units are unable to sustain themselves and finally turn to sick units.
  7. Thus, Small Scale Industries have problems.
Concept: Challenges of Small Scale Industries
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APPEARS IN

Balbharati Organisation of Commerce and Management (OCM) 11th Standard HSC Maharashtra State Board
Chapter 3 Small Scale Industry and Business
Exercise Q.5 | Q 3 | Page 58
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