Problems Faced by Large Scale Industries

Large Scale Industries contribute immensely towards the development of the economy. They provide employment opportunities to a huge number of people and produce goods in bulk. They also provide a range of other benefits. But these industries face several problems. These problems are mainly related to infrastructure, finance and technology.

One of the major factors affecting the success of a Small Scale Industry is the quality of its raw material. Many Small Scale Industries utilize primitive outdated technology, which leads to poor quality products. This in turn causes underutilization of the capacity.

Another problem faced by many Small Scale Industries is the lack of credit worthiness. Due to this, they cannot access the domestic capital market. Also, they rely on the services of local money lenders, who charge a high interest rate.

Furthermore, small scale units are not equipped to tackle the problems of large scale industries. Thus, they are unable to meet the demands of the market. The government has set up various organizations to support Small Scale Industries. However, many entrepreneurs running Small Scale Industries are not aware of the available options.

Another important factor that is preventing the growth of Small Scale Industries is the lack of proper marketing. Without a proper understanding of the markets, Small Scale Industries may not be able to produce goods at the desired level. In addition, they may fail to reach the foreign market due to lack of knowledge on the foreign buying habits. Moreover, their low revenues and uncertain profitability make them vulnerable to strikes and production losses.

Moreover, the lack of raw materials has resulted in gross under-utilization of capacities. Since they are not able to procure the required quantities of raw materials, the production is at a standstill. The result is high cost and poor quality of the product.

Another major problem is the lack of skilled labor. Most Small Scale Industries do not possess the facilities to train their employees. As a result, they do not have a skilled workforce to produce the best quality. Further, the lack of proper management and supervision has led to an uneconomical scale of production.

The lack of communication facilities has also adversely affected the working of different units. Not only this, the absence of transport facilities has further hampered the smooth run of these enterprises.

Small scale entrepreneurs have a hard time acquiring power connections. Moreover, their production schedule has to be planned around the availability of power. Additionally, they have to deal with long power cuts.

Another significant problem is the lack of information about the international currency rates. Moreover, they do not have the resources to upgrade their plants. Therefore, they rely on traditional techniques. If a new technology is adopted, it is too expensive. Moreover, they are not exposed to the latest advances in technology.

Small Scale Industries are prone to sickness, since their employees fight for higher wages and better pay. Other factors contributing to sickness are the diversion of funds to other units under the same ownership, conflicts between various interest groups, uneconomical scale of production, and inadequate management.