JAWAHAR HIGHER

SECONDARY
SCHOOL BLOCK-17

1
ENGLISH PROJECT
TOPIC:
SMALL SCALE INDUSTRIES

BY,
I.Olivia Mary
S .Nithyaa
K.Aishwarya
P.S . Priyadharshini
S.Vishaali

2
 JAWAHAR HIGHER SECONDARY SCHOOL, NEYVELI

BONAFIDE CERTIFICATE
NAME:
CLASS:
SUBJECT:
REGISTER NUMBER:

This is to certify that the above mentioned student of

class XII, Jawahar Higher Secondary School, Neyveli has
completed the project in the subject of English during the
academic year 2022-2023 towards the partial fulfilment
of credit for the English Project Evaluation submitted for
the Practical exam held on

INTERNAL EXAMINER EXTERNAL EXAMINER

3
 OBJECTIVE

The main objective of this essay is to

create more employment opportunities.
To help develop the rural and less
developed regions of the country. To
reduce regional imbalances.

4
 CONTENT
PAGE NO.
1. INTRODUCTION 6

2. MANUFACTURING INDUSTRIES 8

3. ANCILLARY INDUSTRIES 10

4. SERVICE INDUSTRIES 12

5. PROBLEMS FACED BY
COTTAGE INDUSTRIES 14

6. BIBILIOGRAPHY 17

5
SMALL SCALE INDUSTRIES
INTRODUCTION :
Small scale industries comprise of small enterprises that manufacture goods or provide
services with the help of smaller machines and a few workers and employees. Small
scale industries are labour intensive yet require little capital. Small scale industries can
be either manufacturing industries or service providers.
Small scale industries in India are the lifeline of the Indian economy, and they offer
several job opportunities for skilled labours. . small scale industries are essential for the
economy from a financial and social point of view.
For a developing country like India, these industries bloom because of huge demand
and opportunity. Some small-scale industries are also exporting goods, thereby bringing
foreign currencies in India.
Some small-scale industries are created because of the demand of vendors for
multinational companies.
The characteristics of small scale industries are: ownership, labour intensive, flexibility,
management, reach, and resource utilisation. The Government of India has some
guidelines for small scale industries in terms of investment the company is making and
the revenue it has generated. Small scale industries are categorized into three:
manufacturing/production, ancillary and service industries.

Classification of Small scale industries:

✓ As per the MSMED Act 2006: Classification of the Manufacturing process

An industry is a small enterprise if investment in plant and machinery is more

than 25 lakhs but does not exceed five crores.

✓ As per the MSMED Act 2006: Classification of service enterprises

An industry is a small enterprise if investment in equipment is more than ten

lakhs but does not exceed two crores

✓ Ancillary small industrial unit: Minimum 50% of the production to be supplied

to the parent unit and investment in plant and machinery should not exceed one

crore. Some examples of small scale industries are: Agarbatti making, Chalk

making, Biodiesel production, Sugar candy manufacturing, Wood making, Rice

mill, Potato chips making, Toys making, Microbrewery, Liquid soap making,

6
 Honey processing, Slippers making, Detergent powder making, Fruit juice

production plant, Spices making, and Chocolate making.

Registration for small scale industries
One can own or invest in small scale industries with minimal documentation and little
investment. Small scale industry registration is hassle free, and the government also
supports with finance.
SSI registration
The banks and financial institution provides loan for the business after SSI registration,
and it becomes hassle-free. Once the booking is made, taxes rebate and can be
availed. To participate in the government tenders, it becomes mandatory to have the
registration done beforehand. As a lot of concessions and discounts are available, it
becomes smooth, and the cost of setting up the industry reduces.

PROBLEMS IN HANDLING SMALL SCALE ENTERPRISE

• Shortage of funds and raw materials – The most severe problem and money
management should be done at all levels
• Marketing problems – Proper advertisement to run the show every time
• Quality – To fulfill the demand, one should not compromise with the condition.
• Technology – Be in par with the latest technology. It helps to reduce the cost of
investment and increases the quality.
• Managerial skills – To handle the labour class and get the work done from
them.

7
MANUFACTURING INDUSTRY
The manufacturing industry is a tremendous asset to the development and the quick
rise of a country. The manufacturing industry is accountable for the mass production of
technology, machines, buildings, food, and even certain parts that can be manufactured
to later complete a plane, car, etc. With the industrial revolution that occurred during the
18th and 19th century manufacturing industries came to be, eventually replacing difficult
hands on labor with ease by introducing machines that were powered by fuel. With the
fast development of the economy, there is a higher demand for products; the
manufacturing industries then are in need for more labour workers thus increasing the
money that they have to waste in order to pay the labourers. This problem was then
solved by globalization in which a manufacturing industry is able to construct factories
abroad, preferably in less developed countries where they can pay less to labourers for
the same amount of work. Some examples of small scale manufacturing industries..

Toy manufacturing industry:

Now the ‘made-in-India’ toys have a very clear edge in the domestic markets and the

manufacturers are scaling up their production capacity to meet the growing local as well
as international demand. Indian toy sector is expanding on the shoulder of a growing
young population, rising disposable incomes, and a slew of innovations for the junior
population base. The industry stands on the cusp of significant opportunities in every

8
toy segment such as electronic toys, puzzles, construction and building toys, dolls,
sports and outdoor play toys, infant/pre-school toys, and activity toys.
Problems faced by toy manufacturing industries:
➢ Short lifecycle of toys
➢ High failure rates of new toys
➢ High market risks and difficulty to predict trends
➢ Highly fragmented markets and difficulty to enter new markets
➢ User-centric products & Maker movement
➢ Virtual and augmented reality as main technologic trend.

PAPER MANUFACTURING INDUSTRY:

The paper industry plays a very important social role for the country. Use of paper is
considered as an index of cultural growth. The paper industry also contributes towards
fulfillment of various requirements of the industry as a whole like information
dissemination, publicity etc. Which in turn stimulate industrial growth of the country. The
paper industry has, thus, a catalytic role to play not only for the overall growth of the
industry but also for the living standards of the people.

9
ANCILLARY INDUSTRIES
The industries that make various components and parts used by large commercial
enterprises to assemble their final merchandise are called ancillary industries.

Features of Ancillary industries

1. It is involved in manufacturing or producing sub-assemblies parts, components,

intermediates, or tooling.
2. Supplying 50% of its manufacture or services to one or more other industrial
undertakings.
3. They have a fixed investment in machines and plants not surpassing Rs.1 crore.
For example: - Industries which manufacture parts for automobiles, railway engines,
tractors, etc. are ancillary industries.
Economic performance of ancillary industries
Ancillary units are small Firms that manufacture and supply intermediate goods to
large Firms or master units. In India, the official definitions of a small scale unit and an
ancillary unit, for registration, imply that both produce a mix of intermediate quads and
end products. As this mix varies from Firm to firm and over time, reliable data on the
output of the ancillary sector in India are not available, One estimate is that the
ancillary industry contributes barely 0.5 percent of the total output, while in Japan the
corresponding figure is 30 percent, Several policy measures are being considered to
stimulate the growth of the ancillary industry and step up its contribution.

Advantages of ancillary industries:

The advantages that heavy industries have due to ancillary industries are as follows:

Innovation: Due to the existence of ancillary units the heavy industries save much time
for doing innovation in their products rather than simply making smaller units.

Specialization: When parts or components are made by ancillary units, they are
specialized in that product.

No storage needed: The storage problem is solved as it is in the hands of heavy

industries to order only when they require.

Suppliers can be changed easily: Heavy industries can easily change the suppliers
(ancillary industries for components or small parts if quality of product decreases which
is not easy in case they are made on their own. Also, if there is a need to change their
requirement, they can easily change their suppliers.
10
Capital diversification: Heavy industries can use capital saved from while taking off
small parts from ancillary industries to research work in their product and thus make
more profit as that product will not be available in scarcity as compared to smaller units.

The ancillary small industry can manufacture parts, components, sub assemblies, tools
or intermediate products for the parent unit.

Apart from catering to the needs of the parent unit, it can do business on its own. units
have the advantage of assured demand from parent units.

Problems faced by Ancillary Units:

Variation in demand –Immediate problem faced by ancillary unit is their vulnerability to
variation in demand. When the large scale manufacturer producing an end product
faces slackness in demand, the ancillary units supplying the components is hit hard &
may have to remain practically ideal until the demand for the end product revives.

No alternative outlet –The production apparatus in the ancillary unit is highly

specialized & tailored to meet the requirement of a particular assembly. It is therefore
not possible to switch over to any other items without incurring losses on account of
machinery installed. Therefore an ancillary unit is a captive unit without alternative
outlet.

Financial squeeze

During the times of financial problems, there is a tendency on the part of the parent
firms to squeeze the ancillary units by giving themselves the credit to nonpayment of
bills. Therefore the ancillary units are in a more vulnerable position than small – scale
industrial units.

11
SERVICE INDUSTRIES

A service industry provides people with intangible products or services and

completes tasks that are useful to customers, clients, businesses or the general public.
Service industries, unlike, for example, manufacturing and production industries, do not
rely on the sale of material goods and products to earn a profit. Instead, the individuals
who work in the service sector focus on completing tasks and providing services.

FEATURES OF SERVICE INDUSTRIES:

1) DELIVERING ESSENTIAL SERVICES TO PUBLIC: Often, service industries
provide essential services to the public, such as healthcare, transportation and
education.
2) CREATING POSITIVE EXPERIENCES: Several service industries, including
hospitality, beauty and wellness, entertainment and fitness, create positive
experiences that provide emotional value and promote the well-being of those they
serve.
3) PROVIDING EMPLOYMENT OPPORTUNITIES: As manufacturing and production
industries become more mechanized, the demand for service industry workers is
increasing in areas such as distribution and sales, creating a surplus of opportunity.
The service sector offers several rewarding careers to individuals passionate about
delivering important services to their community.

12
ADVANTAGES OF SERVICE INDUSTRIES:

Frequently, businesses in a service industry consider their current employees

when opportunities for promotion or advancement arise before considering external
candidates to fill available positions. A service industry job may present you with more
opportunities to advance in your career than in other industries because of the value
placed on loyalty and hard work within the service sector.

Service industries often foster entrepreneurship due to their low startup costs
and lack of manufacturing processes. After gaining valuable skills and expertise working
for a business in a service industry, individuals may choose to start their own small
business with the service knowledge they've gained from their role.

During challenging times in the economy, people generally reduce their

spending on material goods and seek the services and nonmaterial goods offered by
the service sector. This offers job security to those working in service industries with a
low risk of job loss, layoff, and furlough or business closure during economic downturns.

Securing a job in a service industry often includes focusing on and developing a

specific set of skills and expertise. Performing tasks and completing services that
develop those skills daily can sharpen your expertise and knowledge in a certain field.

Working in a service industry typically involves close communication with the

general public, customers and fellow team members. A service industry job allows you
to improve your interpersonal communication and teamwork abilities. These skills can
be useful in other, more advanced service professions or in any other field in which you
may choose to pursue a career.

PROBLEMS FACED BY SERVICE INDUSTRIES:

Service business is harder to value than a manufacturing or retail company. Those

businesses have inventory, equipment and other hard assets that have a value. You
can start a service business with a phone and very little equipment. While this makes
for a simple start-up it can make for difficult valuation. You have to establish a track
record of sales and some reliable sales projections to convince lenders of the value of
your company.

In difficult economic times, consumers usually cut back on services. They focus on
products they need to survive and prosper, and services are often looked upon as
extras.

For example, a person who has been paying for oil changes might decide to do his
own oil changes to save money. A person who has been hiring a dog walker may
decide that she can do the job herself and save money.

13
PROBLEMS FACED BY COTTAGE INDUSTRIES IN
INDIA
Cottage industries are unorganised and fall under the category of small scale
industries.
The cottage sector is valued for its huge potential for job creation. However, while
employment in this business has increased over time, people’s income has declined as
middlemen provide low rates to the makers while taking large portions of money from
the purchasers. But it isn’t just the middlemen and dealers who are to blame. The
current state of the cottage industry is also due to the altered foreign policies and
globalization.

Power looms are always posing a threat to handloom weavers. These employees have
dedicated their entire lives to knitting and needlework. They have an unmatched level of
expertise. However, they are still in the same area where they began years ago. An
industry that employs a substantial portion of our population is in such bad shape. With
almost 4 million individuals employed in the handloom sector, this situation
demonstrates the hardships that these people face. It’s worth noting that nearly half of
the people employed in this profession live in poverty. In addition, according to the 2017
census, these people’s average yearly household income is barely Rs 41,068. And,
given the enormous family sizes in this segment of the population, the per capita
income is hardly enough to live on.

In India, cottage industries face a scarcity of capital and a great supply of labour, forcing
them to invest in capital-saving measures. As a result, there is a pressing need to
employ strategies that not only increase output but also expand labourers’ abilities and
suit the needs of the local market.

Efforts should be put toward the advancement of technology so that workers can live
comfortably.

14
 CONCLUSION
India’s cottage industries are culturally and economically significant. They preserve
ancient traditions while simultaneously employing a large number of people. Because
these industries confront intense competition from other economies, society should
provide support to prevent exploitation and further develop them. The only solution to
combat the monster of unemployment in over-populated countries like ours is to
promote cottage and small-scale industries.

They use traditional ways to create consumable goods. Furthermore, these industries
emerge in areas where unemployment and under employment are common.

15
16
 BIBILIOGRAPHY
https://www.indiaessays.com

https://www.economicsdiscussion.net

WIKIPEDIA

https://www.virtualguru.com

https://www.yourarticlelibrary.com

17