A typical 90s kid, I grew up in an India which wasn’t exactly free of big corporate giants. Butter meant AMUL and chocolate meant Dairy Milk and washing powder meant Nirma. Yet, as much as you became a recipient of mass commoditization as introduced by well known brands and big national and multinational businesses, a typical day in your life also involved ample integration with small businesses. The neighbourhood salon, which you visited not only for their services but also a fresh round of gossip of what was happening in your locality. The chai-wallah (tea-seller) down the road whose ginger tea pulled in everyone from the aam aadmi (common man) to the multimillionaires of the town. The kirana (grocery) shop, where the uncle behind the counter had seen me since I was a toddler, where thanks to a relationship that spanned generations (my great-grandfather knew uncle’s grandfather) we got to to buy entire months worth of grocery in advance on credit.
And if that weren’t enough, being an offspring of a first-generation entrepreneur, allowed me to gauge first hand what small businesses were, how they were established, the challenges they typically experienced, and how they had to grow strength to strength to sustain themselves in competitive environments. They struggled, and stumbled, yet managed to stay, survive and thrive.
At first glance, small businesses might seem like the Davids of the world, in comparison to the Goliaths – the multinationals. Yet, combine them together, and they’re quite a force to reckon with. There’s data to prove it too. According to reports by CII, in 2017, a staggering 95% (almost 42.5 million) of business units in India comprise small and medium scale enterprises. SMEs in the country collectively employ almost 60% of the workforce in the country.
Which means the conclusion is clear. Small businesses are big.
What is about them, though? What makes them vulnerable, yet resilient enough to withstand the forces of the big daddies? Why do small businesses manage to not just compete, but coexist with their international, mammoth counterparts?
Possibly because at heart, they are more than a mid-sized profit-making entity. Or because they offer nimble, personalized services as opposed to homogenized offerings of the faceless corporation. Or maybe even because due to limited resources as opposed to their bigger counterparts, they are forced to remain lean and cost-effective in true startup sense. And if nothing else, the fact that at heart, they remain largely relationship oriented – both within the enterprise as well as with customers. For instance, every trip to the kirana store ended with me getting complimentary candies from uncle. My chai-wallah knew exactly how strong my father liked his tea. And in a society that still thinks with a heart, like ours does, such snippets of customer delight are huge.
Small businesses are a living proof to the entrepreneurial zeal of the country, society and times we live in. In an era where foreign giants are eyeing companies in India that they can buy out, these are essentially the start-ups in true sense. Which is why it’s no coincidence that everyone, from Facebook to Amazon are working relentlessly to strengthen their relations and operations with small players, instead of dismiss them as worthless competition.
In developing, populous, heterogeneous countries like ours, small businesses are the heart of the economy. Ones that are critical to national well being, both financially and socially. For on a slightly more romantic note,they don’t just serve the economy they’re in. They make homes, families and households run. They give an entire strata of society, economic valuation, financial freedom, and social status.
Not every small business remains small in the long-run. Every mega conglomerate was once a small business. And small businesses, make a big difference.