Setting up a new SME

As we know that SME sector of Indian economy has been most vibrant sector for following reasons:-

1.    More than 95% of total industrial units.

2.    40% of total direct export & this figure is much more if we add indirect export.

3.   Highest employment next to agriculture, employing 42 million people, and employing 5 persons per lakh of investment.

4.    45% of total industrial output.

5.    Producing more than 8000 products.

Central and state governments in India along with banks, promotion councils and with various schemes is supporting SME sector.

So it is very high time when one can make his dream to be an enterprenur true.

Procedure for Starting a SME unit

1. A Business  Plan

It covers from choosing the product to establishing business and personal goals.

Enterprenur has to decide his financial risk taking capacity along with his financial resources.

Location decision, Product costing, Fixed and variable cost estimations, marketing plans, identification of customers, equipment and material suppliers and competitors is also a part of business plan.

Steps For Implementation of Business Plan

(i) Decision regarding status of organization & its Name (Consultants help would be a better option for the same)

a.     Proprietorship

b.    Partnership ( Partnership deed & get it registered)

c.     Public or Private Limited Company ( Registration with ROC)

(ii)   Getting you PAN Card.

(iii)  VAT registration / Excise Registration / Service Tax Registration as per requirement which may be finalized after discussion with a consultant.

(iv)  Registration with various laws e.g. ESI, PF, as per size and requirements.

(v)  Deciding the requirement for Bank Finance.  Various good scheme are available with banks (nationalize and private), SIDBI. Knowledge about CGTMSE is most beneficial.

(vi)  Selection of banker, insurance for fixed assets, stocks, persons, export recievables and various other beneficial products.

(vii)  Setting up infrastructure, equipments, machines, furniture other fixed equipments.

(viii) Employing required executive staff and labor. Line up raw material and other suppliers.

(ix)  Fix a starting date and start the unit.