DARE - Because Entrepreneurs Do

The event gave SMBs a unique platform to discuss issues and challenges thrown up by the current economic slowdown

The small and medium businesses (SMBs) are the engines of economic growth, with 13 million such units dotting the country, giving employment to over 40 million people and contributing to 40% of India’s exports. The global economic recession that has had its ripple effect on India has badly hit SMBs, particularly those that are heavily export dependent. Yet, with India’s growth story still intact and its consumer base continuing to grow, there is a lot that SMBs can do to grow their business. Against this backdrop, DARE organized mentorship forums in Chennai and Bangalore to look closely at the issues and challenges faced by the SMBs, and to help those running these businesses with some tips to do better.

A host of issues came up for discussion in Chennai. These ranged from ways to scale your business to working on a smoother employer-employee relationship. On the question of valuations, many wondered if it was just a perception and if not, how could one do a flawless valuation of a company. One of the panelists at the event, Narayanan Ramaswamy, Executive Director, KPMG, said valuation takes into account projected cash flows of the company. Future cash flows are expressed in range and not as absolute numbers. The panel that also comprised Satyen Vyas, Director, Enterprise Products Sales, SMB, Dell India, felt that immediate revenue would mean higher valuation.

Another topic that came up for discussion was the growth aspect of SMBs. How could small become big? The panelists felt that acquisitions and partnerships were the right way for small businesses to grow. Changing with times is as important and as the change in mindset to deal with the growing competition in every sphere of business. Being a small business doesn’t mean it can’t create potent entry barriers in their sphere of business. Localization, creating a goodwill among customers is one way of retaining hold on business. Over 110 participants from the SMB sector turned up at the event in Chennai.

The Bangalore event focused on issues relating to attracting, acquiring, training and retaining workforce, marketing and sales strategies for small businesses in recessionary times, and technology solutions for a more effective functioning of business. Picking up from live experiences, the participants sought effective customer retention strategies. Ashim Bose, Co-founder, The Aktion Group, said it is not just the product or a service that one offers to the customer, it is the whole experience that one sells, and if as a business one is able to make the customer hook on to that, there is no question why one would lose customers.

On hiring and retention strategies, Prashant Bhaskar, Founder, plugHR felt that every other business is a competitor when it comes to acquiring talent. He said that blaming MNCs for creating a talent deficit was not the right approach. The participants felt that merely having the right talent was not all. Putting the workforce to the best possible use was more important for retention and to keep employees motivated.

On the technology front, the participants felt that SMBs needed to be more aware. While a host of technology solutions were at their disposal, SMBs are hesitant to deploy them despite the fact that it would enable them to run businesses better.

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