Digitisation, Costs And Efficiency To Help Regional MSMEs To Grow: Suchit Subhas, Amazon Business
India’s micro, small and medium enterprises (MSME) sector is called the lifeblood of the Indian economy as they contribute approximately 30 per cent to the annual gross domestic product (GDP) and also employ an estimated 23 per cent of the country’s total workforce.
However, in an interview with BW Businessworld, Suchit Subhas, Director, Amazon Business said that in the current scenario, small and medium businesses face many gaps such as the latest technology and skills gap, how to scale and expand, how to grow revenues and how to get new consumers.
He mentioned that digitisation, costs and efficiency will help Indian MSMEs to grow further. Edited excerpts:
How your company is helping India's small businesses and what are the future plans to empower them more?
Amazon Business is driving the adoption of e-procurement in India and contributing to the digital India mission by providing a reliable and efficient marketplace for businesses to purchase online. We have over 16 crore GST-enabled products. In 2017, we started with 14,000 sellers and now we have over 6.5 lakh sellers onboarded with us. Our marketplace offers easy online procurement, a wide customer and seller base along with the tools to manage procurement efficiently.
This helps micro, small and medium enterprises (MSMEs) save time and money by streamlining their procurement processes and providing them with insights to make informed purchasing decisions. Today, Amazon Business India is the second largest market after the United States (US).
Can you please explain the contribution to the MSME sector through e-procurement?
In the current MSME space, small and medium businesses face many gaps such as the latest technology and skills gap, how to scale and expand, how to grow revenues and how to get new consumers.
We are adding features catering to their requirements such as multi-address delivery on a single order, multi-user accounts and approvals and spend analytics. Apart from GST, we accept business PAN as a license type which enables MSMEs with a turnover of less than Rs 20 lakh to register on the platform.
How can the concept of e-procurement be taken forward to remote areas where small businesses find difficulties to sell their products due to several reasons?
For remote areas, we have multiple benefits to help small businesses get access to a wider audience and help them expand their business:
Language support: It helps to bridge the language barrier and make it easier for MSMEs in deeper geographies to use the marketplace.
Reduced logistics costs: The delivery options, including doorstep delivery, helps MSMEs in deeper geographies to reduce their logistics costs. This is especially beneficial for MSMEs that are located in areas with poor connectivity.
What are your views on the Union Budget as far as the MSME sector is concerned?
B2B e-commerce has seen immense growth in the last few years globally as well as in India. MSMEs contribute nearly 30 per cent to the overall gross domestic product (GDP) of India and provide employment to millions. We see this space growing rapidly in future with support from government schemes as well as tailwinds from affordable internet access.
While referring to MSMEs as “growth engines”, Finance Minister Nirmala Sitharaman announced a slew of reforms that will provide the necessary impetus to boost the sector’s growth and improve its international competitiveness.
The government announced a revamped credit guarantee scheme for MSMEs with an infusion of Rs 9000 crore. This will enable additional collateral-free credit guarantees of Rs 2 lakh crore rupees, which will lower the cost of credit by 1 per cent.
The digital ecosystem for skilling will be further expanded with the launch of a unified skill India platform for enabling demand-based skilling, linking with employers including MSMEs, and facilitating access to entrepreneurship schemes.
Right nurturing of this segment coupled with technology adoption initiatives and supportive government policies will be pivotal to further promoting the MSME sector and placing them on the global map.
What are the main focus areas for 2023 and key trends in the MSME space?
We see three large trends emerging in this space:
Digitisation: MSMEs will leverage digital technologies to improve their competitiveness and reach new markets. This will involve the adoption of online marketplaces, digital payment systems and cloud-based tools for managing business operations.
Costs and efficiency: MSMEs will move to become more efficient, reduce costs and enhance their profitability via the adoption of new technologies and the creation of new business models.
Regional growth of MSMEs: Regional growth of MSMEs will accelerate with an increase of skill levels in smaller towns and rural areas, accelerated by the tech adoption mentioned earlier.
What can we expect from your company this year?
We have introduced multiple services and will further develop credit extensions and business analysis tools, and provide a wide selection and greater savings for the customer.
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