What are Procedures or steps for starting up a small-scale business?

What are the procedures or steps for starting up a small-scale


A small-scale unit is normally a one-man show and even in the case
of a partnership the activities are mainly carried out by the active partner
and the rest are sleeping partners. The area of operation of small units is
localized, catering to the local or regional demand.


Small Scale Business provides more independence than large-scale business and through this type of business, one can fulfill their
dream to become an entrepreneur.

1-Decision Making: First of all, you need to prepare the description for the
small-scale industry you want to set up. It is necessary to decide whether you
wish to set up a corporation, proprietorship or partnership.

2-Scanning of Business Environment: Before setting up your industry, it is
always essential to study and understand the prevailing business environment in
which they operate particularly the industrial policy, economic policy,
licensing policy, legal environment, and technological environment.

3-Product Selection: You need to decide the product you wish to manufacture or the
service you wish to offer.

4-Location: You need
to choose a location to set up your small-scale industry. While choosing the
location such factors such as nearness to market, sources of material,
availability of raw materials, labor, transportation services, modern
infrastructural facilities and other things are considered.

5-Technology: To
manufacture any item, technology is used. The entrepreneur should collect
information on all available technologies, and the most suitable one should be

6-Project: Project
appraisal means the assessment of a project. the entrepreneur has to appraise
the project carefully from the standpoint of economic, financial, technical,
market, social and managerial aspects to arrive at the most socially-feasible

7-Finance: Finance is the lifeblood of the enterprise. So,
the next big step is to arrange for finance. business cannot be created, with
zero capital.

8-Provisional Registration: It is necessary to get the provisional registration with the government. The
entrepreneur has to obtain the prescribed application from the Directorate of

9-Production Management: Production management is the next step, once you can start your
small-scale industry. This includes allocating space for different operations
and choosing your production methods.


10-Power and Water Connection: The sites where the enterprise will be located
should either have adequate power and water connections, or it should be

11-Installation of Machinery: Once the above formalities have been
completed; the next step is to procure machinery and begin its installation as
per the plant layout.

12-Insurance: It is
necessary to have adequate insurance for fixed assets at this stage and later
on for the current assets as well.

13-Recruitment of Manpower: Once machines are installed, the need for manpower arises to run
them. So, the number of labor and type of manpower are to be decided. This
follows the recruitment, training, and placement.

14-Production: The unit
established should have an organizational set-up. To operate optimally, the
organization should employ its manpower, machinery, and methods effectively.

15-Marketing: Marketing
is the most important activity as far as the entrepreneurial development is
concerned. Marketing and business advertising form the next big step of setting
up a small-scale industry.

16-Permanent Registration: After the small-scale unit goes into production and marketing, it
becomes eligible to get permanent registration based on its provisional

17-Market Research: Once the product or service is introduced in the market, there is
strong need for continuous market research to assess needs and areas for
modification, up gradation and growth.

Periodical monitoring and evaluation not only of markets but also production,
quality, and profitability help in knowing where the firm stands in comparison
to performance envisaged in the business plan.

G ADs:


It can be concluded that setting up small scale industries is not a
difficult task. The procedure of small-scale industries is simple and easy than
the large-scale industries. So, if one wants to set up an industry, one can
surely go for it. It is profitable, easier and helps in the growth of the
economy of the country.

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