MSME industry understands that they must transform to stay relevant
For several decades, India’s MSME sector has been the major driver of economic growth. In India, there’s about 6.3 crore MSMEs, and they contribute about 29 percent of the country’s GDP. Services and manufacturing companies have plenty of room to grow and expand.
1.Tell us about the Stratefix Consulting journey.
Larger consulting firms specialize in specific departments for larger businesses, but their work is generally confined to metropolitan areas. Despite contributing significantly to India’s GDP, the MSME and SME industries are often seen as pursuing traditional business practices, not interested in reinventing themselves to be more modern. This is a huge misconception. SMEs and MSME industries understand that they must transform to remain relevant, but actually taking on this journey can be difficult. This is one of the reasons we set up Stratefix Consulting – to assist SMEs and MSMEs across India to scale and become relevant.
Since our inception, we have helped over 300 SMEs and MSMEs scale up and reinvent themselves. Our unique selling point is that we study the challenges, strategize solutions, and assist in implementing them. We work as an extension of the company in many ways:
- Gain market penetration and launch of new products – Increase sales (top line)
- Optimise the bottom line by mapping labor, streamlining fixed and variable costs
- Develop new Systems and Processes – Re-engineer the processes in manufacturing as well as services
- Obtaining consumer insights and validation of products and ideas through primary market research
- Implementing performance management, defining roles and responsibilities, and compensation and benefits.
- Implement ERP, HR, and sales software
- Executive hiring
We have worked with companies across a wide range of industries, including FMCG, Jewelry, Manufacturing, Service-based companies, and Chemicals. The USP of our business is that we provide the strategy and also support the execution of the complete plan. In our sales consulting, for instance, the assignments aren’t just about defining a strategy, but also helping the team achieve the desired results. Similarly, when it comes to streamlining processes and systems, we work from the bottom up. Unlike mainstream organizations, we work from the shop floor up.
2.What makes Stratefix Consulting different from hundreds of other similar service providers?
Our focus is not only on strategy, but also on executing the full plan – and that’s what makes us different from any other business management consultancy. We study the challenges, strategize solutions, and assist in implementing them. For instance, during a sales consulting mandate, the project goes beyond just creating a plan – it also involves working alongside the team to achieve the desired results. For the same reason, when streamlining processes and systems, the work is done ground up, unlike mainstream companies.
We tailor our approach for each client, depending on what the challenge is. Suppose, for example, two companies have problems with the HR department, the problems could be entirely different. Both may need policies, but the type of policies will differ. Our internal teams analyze data constantly to identify areas where clients need additional assistance – such as finance, HR, marketing, sales, etc.
3.What is the market opportunity for consulting with SME & MSME companies?
The Indian business consulting market is worth $4.5 billion! This market is concentrated in metropolitan areas though. For business consultants, there is a huge market in the SME and MSME industry, which is predominantly found in mini-metros and tier 2 and 3 cities. This is where we wish to focus our efforts.
4. What are the challenges that SMEs and MSMEs face, and how can these be overcome?
Unlike larger organizations, SMEs and MSMEs face unique challenges:
- Since these companies are generally founder- or family-led, it’s hard for leaders to manage everything, especially day-to-day operations
- As entrepreneurs struggle with streamlining operations and controlling costs while scaling, they require assistance strategizing beyond a certain level of growth and scale
- Due to the traditional nature of MSMEs, transforming to a more professional, or even a digital way of doing business, poses challenges
- Companies recognize the need to adopt and integrate technology, but are reluctant to make the commitment
- SMEs and MSMEs should also understand the value of investing in the right resources, with the necessary expertise and talent.
Therefore, these companies need a partner who understands their needs, strategizes a solution, implements it, and helps ensure it is executed.
5.Take us through 2 case studies of how you have helped companies transform/grow/scale.
Let me share the example of Sumicot Ltd. and GrowIt – two firms that we work with.
Sumicot Ltd. is a family-run business that manufactures cotton yarn and fabric for export. The company exports its products to European countries from its headquarters in Dahej. As operations expand, the company needed to establish a dedicated HR department to better manage employee relations. We were brought on board to help Sumicot with its HR processes. It is being transformed, standardized, and consolidated into a single, unified division across the organization. This will allow the company to provide a better employee experience and improve service levels.
Secondly GrowIt, one of India’s leading Agritec companies, which manufactures and distributes state-of-the-art modern protective farming equipment that ensures optimum quality and yield in Indian agriculture. The company hired us to analayse the sales and HR functions and see how we could revamp and improve operational efficiency and effectiveness. With reference to sales, we had a mandate to create the entire sales infrastructure, strategizing and implementing it finally across the geographic region. Additionally, with regards to HR, we had the entire scope to strengthen both their current and future HR department.
6. What are your growth plans?
Our goal is to transform 10,000 businesses by 2030! We plan to do this by introducing our exclusive franchise model across all tier B towns in India.
As India’s MSME market represents an enormous opportunity, we are focusing on building teams to work with companies across the country. We want to offer MSME all the services they hear about in corporate jargon. We have plans to expand our services to include strategy audit, M&A consulting, family charters and constitutions, and data analysis.