Product and process quality are key to increase in reach, exports

Micro, small and medium enterprises (MSMEs) operating in the manufacturing and services sectors stand to gain significantly from quality products and processes. And as they focus more on quality, they see an increase in reach and customer confidence.

CRISIL’s analysis of over 3,500 MSMEs from these sectors shows that over a quarter of them are quality-oriented. Of this lot, about 60 per cent have clearly enhanced customer confidence because they have been serving them for more than five years.  CRISIL has used quality certifications such as the International Organisation for Standardisation (ISO) as one of the yardsticks to assess product and process quality among MSMEs.

Many MSMEs have been able to meet international standards because of their quality orientation and consequently, have expanded their footprint overseas. About 66 per cent of the quality-oriented lot have diversified geographic reach and earn about 15 per cent of their revenue through exports.

CRISIL believes the quality certification scheme promoted by the Development Commissioner of the Ministry of Micro, Small and Medium Enterprises will encourage MSMEs to get their products and processes certified and thereby ensure higher quality.

Note: This fortnightly tracker presents to our readers insights on MSMEs, a key element of the Indian economy. CRISIL has rated over 91,000 MSMEs in India.