For understanding the different types of small scale industries, comprehend the idea of an independent company. Private company is held to be small when it is small in size, utilizing a lesser number of workers, having a speculation of a small quantity of capital, and in any event, having a yield or benefit which is small. These are conventional comprehension of independent company. Peruse on to comprehend the idea exhaustively.

Meaning of small scale industries

The Micro, Small and Medium Enterprises Development (MSMED) Act, 2006 groups the Micro, Small and Medium Enterprises into two divisions, which incorporate:-

1. A Manufacturing Enterprise

It is occupied with the assembling or creation of merchandise which are associated with any industry indicated in the principal timetable to the Industries (Development and Regulation) Act, 1951). Additionally, they might work through plant and apparatus towards esteem option to the end result. The eventual outcome might be having a particular name or character, or use. The Manufacturing Enterprise is characterized as far as interest in Plant and Machinery.

As referenced over, the primary timetable contains a rundown of 38 businesses. A few models are Metallurgical, fuel, boilers, and others. These are characterized as ventures utilizing producing measures.

2. A Service Enterprise

It is occupied with giving or outfitting administrations. It is characterized as far as interest in hardware.

Types of Small Scale industries

In view of the measure of capital contributed, an independent venture unit can be separated into different sorts. Allow us to go through them as follows:-

(1) Small Scale Industry grouped before the year 2006:- This is concerning the above MSMED Act. Preceding its execution, the small scale enterprises were those where

Interest in fixed resources of hardware and plant didn’t surpass one crore.

They were locked in towards modernisation, trade improvement and use roof in apparatus and plant surpassed five crores.

(2) Export Oriented Units is one of its fares that outperform 50% of its creations or assembling.

(3) Ancillary Small Industrial Unit

They are those ventures that can hold the situation with a small subordinate industry depending on the prerequisite that the provisions are least 50% of its item to another business that is the parent unit.

They hold the status likewise on the off chance that they can deliver parts, machine parts, standard items or instruments for the parent unit.

(4) Tiny Industrial Units are those where the business or organization consumption on hardware and plant doesn’t outperform Rs. 25 lakhs.

(5) Small Scale Service and Business

Here the decent resource financing on apparatus and plant with the exception of land and building ought not surpass Rs. 10 lakhs

(6) Small Scale Industries Owned by Women

These units can pick the proper awards from the government, with low-financing costs on advances, and different advantages gave the undertaking is worked by ladies business people and them alone or in consolidation hold share capital which is least of 51%.

(7) Village Industries as the name recommends are those ventures which are set in provincial regions and produce any item or play out any help with or without the utilization of force. Here the decent speculations on capital are not to surpass Rs.50, 000.

(8) Micro Business Enterprises is a minuscule and independent company area where the interest in apparatus and plant ought not to outperform Rs.1 lakh.

(9) Cottage Industries as again the name proposes they are conventional or provincial businesses. The capital speculation design does exclude them.

Features of cottage industry are:

They utilize private assets.

They utilize work inside the family and locally accessible ability.

Here basic instruments are made being used.

Capital venture is small.

Products are basic.

Technology used is native.

(10) Small-scale Service and Business (Industry related) Enterprises (SSSBE) are those where as far as possible in fixed resources of plant and apparatus must be restricted inside Rs. 10 lakhs. A few models are that of a salon, a showcasing and publicizing consultancy, a modern testing research facility, carports and auto fix, cleaning, a copying community or a Xeroxing focus.

Issues of Small Scale Industries

A few issues are looked by small scale companies. They incorporate a deficiency of money, lack of crude materials, absence of administrative abilities, clumsy work, and issues of promoting, inferior quality items, obsolete innovation, and worldwide contest. Over the long haul numerous endeavors are made to get rid of issues by spreading mindfulness and government support.


1. Potential for enormous business

Small scale Industries can possibly set out work open doors for a huge scale. They are work escalated in character. They utilize more work than different elements of creation. They can be set up in brief time frame and can give business freedoms to more number of individuals. This is significant for a work plentiful nation like India.

2. Prerequisite of less capital

Small scale Industries require less capital when contrasted with enormous scale businesses. India is a capital scant nation and along these lines Small Scale Industries are more reasonable in the Indian setting. They can be begun and run by little business visionaries who have restricted capital assets.

3. Commitment to mechanical yield

Items made by Small Scale Industries structure a huge part of the mechanical yield of the country. They produce various purchaser merchandise just as modern parts in huge amounts and fulfil the necessities of shoppers. The purchaser merchandise delivered by Small Scale Industries are less expensive and fulfil the necessities of the less fortunate segments.


The government is endeavouring towards drives through different motivating forces presented to businesses in reverse, ancestral, and uneven regions. Concessions are given to assets like water, force, and land by the public authority for the small scale industries. Once more, in the Union domains, the independent companies are saved from deals charge. Indeed, even octroi isn’t charged in different states from the small ventures.

There is exceptional treatment given to Small Scale Industries in the assignment of limited assets like crude materials. Credits are additionally dispensed at financed loan fees to the small scale businesses. There are charge occasions and expense exceptions. In this way, small scale enterprises are brooded by the public authority as it supports the monetary advancement of the country.