We came across this great article at Pluggd.in. It is very apt.

SME Market in India is too big to be ignored. And while Indian entrepreneurs are chasing the big enterprise market (and consumer segment), here are a few data points for SME opportunity
• India has the second largest population of small and medium businesses (SMBs) among BRIC countries and the US.
• SMEs in India contribute to more than 40% of the total Industrial Output (35% of it is exported).
• SMEs Provides employment to 75% of India’s workforce.
• In Karnataka alone, there are more than 750 Large to Medium Enterprises with investments of more than 60,000 Crores and employing 4,00,000 people.
• In comparison, there are more than 3,80,000 SMEs with investments of just about 10,000 Crores while employing 22,00,000 people!
SME – Opportunities for Small Players
The challenges that the SMEs face today seem to be primarily in the area of ICT and to quote specifically, ERP. The SMEs lament that when ever they approached the usual ERP firms, the first question they were faced with was that of their turn-over (they are quoted ERP package rates based on their turnover!).
Further, most do not even qualify to be served by these firms since they don’t measure up in terms of turn-over. Most of the practitioners wanted more simple solutions which could be used by the SME work-force, that is largely rural, with education levels being at most at Diploma levels, (in exceptional cases Engineering).
• Only 12% of the SMEs use Computers and 90% for Word Processing – The terms used today was “Typewriter”.
• One of the most startling take away was that in the last 55 years, the India SME manufacturing sector has clocked a steady GDP of 15% to 18%. No geo-political reason, economic downturns nor Policy changes etc seems to have affected this.
• And to put this in perspective, the Indian IT companies are happy if they are 1% or 2% higher than the nation’s GDP!
• SME’s spending on IT is only 30 percent of India’s total IT spending
Have the technology startups considered this space as an opportunity? Do you think the Indian SME presents an opportunity for Technology Startups to deliver smaller and much palatable solutions, which fit both the pocket and the background of the SMEs?

In December 2009, Milagrow launched the SME Portal. It is commonly referred as “One Stop Destination” in terms of unique service offerings to the SME sector. Given its unique nature, Milagrow SME Portal is getting members from across the country, and from different segments such as industry, institutes, individuals and so on.

Portal offerings are best in class, lowest in cost – business & knowledge solutions to the small businesses.  An organisation takes the membership of SME Portal for 1 year, it can gain tremendous benefits in various departments & also save lakhs of rupees per annum.

IT solutions provides almost zero cost solutions where an SME would not on only get access to more than fifteen free & open source software but also get monthly trainings to these softwares at a reduced cost.

Recruitment has never been easy but with HR services, the recruitment has not only become an easy and managed option but also a very cost effective solution. A member of the Portal gets 10 vacancies listing per year (saving approx. Rs. 1.2 Lac) and brand visibility on the Portal.

A small business can raise Debt funding, Private Equity funding and funding required in Mergers & Acquisitions with the help of Milagrow and its Financial Partner.

Milagrow to reach out to the SME manufacturers has partnered with an organisation which has years of experience in implementing MOST technology for productivity improvement in the manufacturing sector.

The knowledge division has risen above all by providing daily advice to SMEs, legal tips and monthly Retail, CDIT & MSME Newsletters. The research database also includes Case Studies, Research Studies, White Papers & Articles across the industry.

The portal members also benefit from our unique business diagnostic clinic titled Venture Doctors as well as online events such as webinars.

The SME Portal has made its way to reach out to thousands of small businesses from all spheres and provide them solutions to help them grow in an ethical, sustainable and profitable manner.

Last week my personal blog set up on WordPress seem to give some strange error messages on a white screen instead of the regular post. These messages had no reason to be there since I had not touched the code for ages. All my efforts seem to fail and I almost reconciled to having lost hundreds of posts. Not just that, I had a theme that I had customized to my liking.

At that point, I expressed my frustration on Twitter and Facebook on having lost my posts. In no time, I had suggestions coming in. I decided to give it a try. First I recovered the database with some effort. Then I managed to recover the content directory. In a matter of hours, I had deleted the old instance and recreated it with a newer version of WordPress. My blog looks as it was.

At Milagrow, we constantly espouse the need to harness Open Source software for the benefit of Micro, Small and Medium Enterprises. Not only that we impart user and application training sessions as well. Our corporate site is on Open Source Software as well(Drupal). We also encourage organisations to leverage social media for promotion. The Milagrow page on Facebook , Twitter, YouTube and LinkedIn serve as precious communication channels to share what we are.

Besides that, we use the same WordPress for running this blog!

Helpful Links:

The presentation I made is here:

The other panelists chose to speak rather than present, so I can’t share the presentations here

There was a lively Q&A session where some students asked me interesting questions on cloud computing, ranking users on Twitter and how Social Media could help small enterprises recruit employees.

Overall a great learning experience for me!

Source : Gautam Ghosh’s Blog

This rule is expected to do two things. One, it will allow companies or individuals to choose extensions that are appropriate to their businesses. The second ruling means that website addresses no longer have to be in English or any other language with a Roman script. You could have a Hindi name, for example, and type your address using a Hindi keyboard… Read More

Every day, thousands of companies generate digital landfills of data as they cater to new customers and generate sales through the internet. All this requires vast data centres to adroitly — and safely — manage and store digital information. India, an IT hotspot, is destined to bite off a large chunk of this rapidly growing business.

The data centre market in India is about $120 million — a meagre 1 per cent of the global market. However, India is “the fastest growing market in the APAC region, with growth rates in the next five years expected to be 22.30 per cent”, says Naresh Singh, principal analyst for enterprise network infrastructure & services at Gartner. According to Anu David, senior research analyst for the ICT practice of Frost & Sullivan, South Asia & Middle East, Indian data centres will soon become globally competitive.

Notably, companies are rapidly moving from managing their content through in-house or ‘captive’ data centres, to ‘third party’ ones run by Indian companies. Today, India has twice as many captive data centres as it does third-party ones. Estimates by Datamonitor, a London-based market research company, suggest that of the 7 million sq. ft of data centre space to be added in the next four years, more than 90 per cent will be for third-party data centres.

In the past, companies were concerned about outsourcing their data handling to others because of security, accountability and intellectual property rights issues. For instance, firms such as ICICI Bank and Indian Oil Corporation (IOCL) have traditionally banked on in-house data centres. ICICI Bank has its main data centre in Mumbai and a disaster recovery site in Hyderabad, while IOCL has data centres in Jaipur and Gurgaon. “The biggest advantage is that we are not dependent on uncertainties faced by a vendor,” says S.S. Soni, executive director for information systems at IOCL. “We are also able to maintain secrecy of information.”….Read More

The retail segment, in particular, is going to be a lead growth segment. The current value of India‘s retail sector is close to $325 billion. AT Kearney has ranked India the No: 1 retail destination in the world. The retail market is, nevertheless, highly fragmented, with organised retailing accounting for slightly over 3 per cent of the total market of close to $8 billion.

However, this market is poised to grow at a staggering 40 per cent CAGR, to touch $40 billion by 2010. While the top 10 cities (metros) present the maximum potential for growth (in value terms), the growth rate in smaller towns will outpace the bigger metros.

Clearly, the opportunity for organised retail is huge across segments and large business groups as well as foreign retailers are ramping up operations rapidly to cash in on this prospect. While the potential is huge, retailers need to address several market realities and adapt accordingly to succeed. Some of the key challenges faced by retailers are listed below.

FIVE KEY AREAS

Retailers in India today are trying hard to set up operations. They are more concerned about streamlining processes and, hence, not really focussing enough on implementing IT. However, they do believe that to scale up operations efficiently and quickly, IT is critical.

The current level of IT and operational processes presents a significant opportunity for IT consulting firms to proactively address the needs of retailers. The firms can capitalise on and leverage their expertise to offer services in five key operational areas. These areas are the basic building blocks for retailers, and overcoming obstacles in these processes is mandatory for retailers to be successful.

Manpower training: A major hurdle faced by Indian retailers is in acquiring and retaining skilled manpower with a good knowledge of retail operations. The industry is currently facing tremendous shortage of frontline sales staff to manage consumers. In addition, the industry is also witnessing a rapid turnover of people with increasing level of competition in the organised retail sector. Lack of good retail management programmes and institutes in the country has worsened this problem.

To overcome these issues, retailers need to gear up with good people management programs. One way this can be done is through certification programmes. IT consulting companies can co-ordinate with specific industry bodies to create certification programmes for retail personnel.

Such programmes can enable employees of retailers to upgrade their basic skills in retail operations. They could also educate retailers about some of the best IT solutions available for different retail functions. The certification can be run both as in-house and as online programmes.

Real Estate Management: High cost of real estate and inability to get the right space at the right location are resulting in cut-throat competition across retailers to occupy prime locations. In addition to these external challenges, retailers also are facing internal issues of not being able to open stores in time and within budgets, despite obtaining the physical space for the stores.

Retailers are, therefore, looking for some help in providing a system or process to streamline operations so that they are able to open stores within the stipulated time and cost. This clearly presents a good opportunity for property management solutions wherein technology can be leveraged to provide project management capabilities to monitor the progress of store launches. Timely launch of retail outlets can provide a good headstart for retailers and save significant funds as well.

Supply chain visibility: One of the big issues faced by Indian retailers is having good visibility on demand (how much they can sell), inventory (how much they have) and supply (how much to order). Indian retailers face high out-of-stock situations (20-25 per cent) compared to less than 5 per cent for US retailers.

Retailers are actively looking for solutions in developing good forecasting and replenishment processes. In addition, most Indian retailers lack good supplier management processes. Most of the sourcing is tactical and there are no long-term relationships with vendors.

IT firms can help retailers set up basic forecasting, replenishment and supplier management solutions to improve supply chain visibility.

Store operations: Even after setting up stores, retailers face issues in running stores efficiently. There are currently no streamlined and defined processes for allocation of products/categories, inventory management (both on shelf and in back room), workforce management and store infrastructure management.

IT consulting firms can focus on areas such as store inventory management, people management and infrastructure management. Efficient store management will help retailers improve service levels and reduce costs.

Logistics management: Poor infrastructure (roads, communication and power) makes logistics and transportation in India extremely difficult. Further, internal operations of retailers, such as warehouse processes and distribution, are usually fairly ad hoc and inefficient.

Shrinkage due to mishandling, theft and other factors is also a big issue facing retailers. The lack of good integrated 3PL operators in India makes warehousing and transportation a big challenge for retailers.

IT consulting companies can provide services in both defining the logistics processes for retailers and also providing services to automate several manual processes. Since the 3PL market is still evolving, consulting companies can co-ordinate with existing players and develop joint ‘go-to-market’ solutions. IT companies can look at providing technology back-end support while the 3PL companies can provide physical infrastructure such as warehouse space and a transportation fleet.

Any developing industry is fraught with challenges. And this is a boon for consulting firms. The organised retail sector is one such evolving market. Retailers in India are currently looking for help in setting up and running stores efficiently and quickly.

This presents a good opportunity for IT consulting firms to proactively step in and offer process and technology solutions. The time is just right and, clearly, the first entrants will reap significant benefits.

Bhavprita Harshawardhan is an Associate and N. S. Hariharan is a Senior Associate, Retail, CPG & Logistics, Infosys Consulting, the consulting arm of Infosys Technologies Ltd.

Source : Topretailing.com