Supporting small business is more than just a financial transaction; it is a crucial step in strengthening local economies, promoting entrepreneurship, and sustaining livelihoods. When you choose to support small business, you contribute to India’s economic growth, create good career opportunities, and encourage innovation.
In a country where Micro, Small, and Medium Enterprises (MSMEs) play a vital role in the economy, small businesses act as the backbone of India’s development. India has over 63 million MSMEs, contributing nearly 30% to the country’s GDP and employing over 110 million people. Despite their significance, small businesses often struggle against competition from large corporations and global e-commerce platforms. Supporting them ensures that India’s diverse and traditional businesses continue to thrive.
But what exactly qualifies as a small business in India? Why is it crucial to support small business owners? And what benefits does the nation gain from this? This article explores the definition of small businesses in India and the 12 compelling reasons why supporting them is essential.
What is Considered as a Small Business in India?
In India, small businesses fall under the Micro, Small, and Medium Enterprises (MSME) category. According to the Ministry of MSMEs, these businesses are classified based on their investment in plant and machinery and annual turnover.
Classification of Small Businesses in India:
- Micro Enterprises: A turnover of up to ₹5 crores and an investment of up to ₹1 crore.
- Small Enterprises: Putting in up to 10 crores and making up to 50 crores every year.
- Medium Enterprises: A turnover of up to ₹250 crores and an investment of up to ₹50 crores.
Small businesses in India include local shops, handicraft industries, textile businesses, agro-based enterprises, and start-ups. They are essential for rural and urban employment, self-reliance, and economic growth.
Now, let’s explore the 12 valid reasons why supporting small businesses is beneficial.
12 Valid Reasons To Support Small Business And Gain Benefits
1. Strengthens the Indian Economy
MSMEs contribute around 30% to India’s GDP and nearly 50% to the country’s total exports. When you support small business, you help keep money within the Indian economy, ensuring economic growth and stability. Local businesses create a cycle of reinvestment, as they purchase materials from nearby suppliers and reinvest in their communities, further driving economic development.
2. Generates Employment
Small businesses in India employ over 110 million people, making them the second-largest employment provider after agriculture. Supporting small businesses ensures job security and helps combat unemployment. A thriving small business sector can reduce poverty levels by providing stable incomes, particularly in rural areas where job opportunities are scarce.
3. Preserves Indian Culture and Traditions
India is known for its rich heritage, and small businesses play a crucial role in preserving traditional arts and crafts. From Kashmiri Pashmina shawls to Madhubani paintings, small-scale artisans and handloom weavers keep centuries-old traditions alive. Supporting them ensures that these crafts continue to flourish and are passed down to future generations.
4. Provides High-Quality and Unique Products
Small businesses, especially in sectors like handloom, organic farming, and Ayurveda, offer high-quality, authentic, and sustainable products that are often superior to mass-produced goods. Many local businesses emphasize craftsmanship, using high-quality raw materials that result in durable and unique products. Choosing such products ensures better value for money and promotes sustainability.
5. Encourages Entrepreneurship and Innovation
With government initiatives like Startup India and Make in India, the country is witnessing a surge in entrepreneurship. if you support small business, it will encourage innovation, self-reliance, and economic progress. Many Indian startups are coming up with innovative solutions in sectors like health tech, education, and e-commerce, creating new market opportunities and improving people’s lives.
6. Reduces Dependence on Imports
India imports a significant amount of consumer goods from other countries. By supporting local businesses, we can reduce dependence on foreign products and boost the ‘Vocal for Local’ movement. Buying locally-made products strengthens India’s manufacturing industry, reduces trade deficits, and ensures that domestic industries remain competitive in global markets.
7. Enhances Rural Development
A significant portion of India’s MSMEs operate in rural and semi-urban areas. Supporting these businesses promotes rural entrepreneurship, reduces migration to cities, and improves living standards in villages. Rural businesses often provide employment to local communities, particularly to women and marginalized groups, leading to inclusive growth.
8. Offers Better Customer Service
Unlike large corporations, small businesses offer personalized customer service, customized products, and better after-sales support, leading to enhanced customer satisfaction. Small business owners value personal relationships with their customers and often go the extra mile to ensure a great shopping experience. This results in stronger customer loyalty and trust.
9. Encourages Sustainable and Eco-Friendly Practices
Many small businesses in India follow eco-friendly production methods, such as organic farming, sustainable packaging, and ethical sourcing. Supporting them contributes to environmental conservation. By choosing local, handmade, or organic products, consumers help reduce pollution and waste generated by large-scale industrial production.
10. Supports Women Entrepreneurs
India is witnessing a rise in women-led businesses, especially in sectors like handicrafts, home-based services, and digital start-ups. Supporting these businesses promotes gender equality and economic independence for women. Organizations like Self-Employed Women’s Association (SEWA) empower female entrepreneurs, helping them access credit and training to scale their businesses.
11. Creates a Self-Reliant India (Atmanirbhar Bharat)
Supporting local businesses aligns with the Atmanirbhar Bharat vision, which aims to make India self-reliant in manufacturing, production, and innovation. Small businesses play a vital role in reducing dependence on imports and strengthening India’s industrial base. By promoting indigenous production, India can achieve greater economic sovereignty.
12. Contributes to Local Charities and Community Development
Many small businesses actively support local causes, employ marginalized communities, and contribute to social welfare programs. Supporting them strengthens community development and social responsibility. Whether it’s a local bakery donating food to underprivileged children or a rural entrepreneur providing employment to women, small businesses often give back to society in meaningful ways.
Conclusion
Supporting small business in India is an essential step toward economic growth, job creation, and cultural preservation. Whether you choose to buy from a local kirana store, an artisan selling handmade goods, or an emerging start-up, your decision plays a role in shaping India’s economic future.
By making conscious choices to support small businesses, we can build a stronger, self-reliant India, empower local entrepreneurs, and create a sustainable economic ecosystem for future generations. The next time you make a purchase, consider choosing a small business—it’s a simple yet powerful way to contribute to India’s prosperity.
