Merits and demerits of small scale industries
Answers
Answered by
3
Easy Management:
The management of small business is easy and economical. Simple accounts and a few persons can manage the job well.
Freedom of Work:
There is complete freedom of work in a small business organisation. Workers are more or less self-sufficient. They are not dependent on the capitalists and carry on their jobs freely.
External Economies:
The small scale production secures all kinds of external economies, which are available to large units also. These economies are: better transport, electricity, and communication facilities; banking and insurance services; technical workers, etc.
No Evils of Large Scale Production:
The small scale production cannot fall victim to the evils of the large scale production i.e., evils of the factory system, overcrowding, etc.
Other Advantages:
In the small scale production, there are some important advantages over the large scale production:
The following are the demerits of small scale production:
1. High Cost of Production:
The cost of production per unit increases because there is a high cost of labour, a very little scope for division of labour and lesser use of machinery.
2. Wastage of By-products:
In the small scale production, it is not possible to make economic use of the by-products, as in the large scale production. By-products of the small producers generally go waste.
3. Less Use of Machines:
In the small scale production, there is less scope for the use of machines. As a result, these firms cannot take advantages of the use of the machinery.
hope it helps!!❤❤
The management of small business is easy and economical. Simple accounts and a few persons can manage the job well.
Freedom of Work:
There is complete freedom of work in a small business organisation. Workers are more or less self-sufficient. They are not dependent on the capitalists and carry on their jobs freely.
External Economies:
The small scale production secures all kinds of external economies, which are available to large units also. These economies are: better transport, electricity, and communication facilities; banking and insurance services; technical workers, etc.
No Evils of Large Scale Production:
The small scale production cannot fall victim to the evils of the large scale production i.e., evils of the factory system, overcrowding, etc.
Other Advantages:
In the small scale production, there are some important advantages over the large scale production:
The following are the demerits of small scale production:
1. High Cost of Production:
The cost of production per unit increases because there is a high cost of labour, a very little scope for division of labour and lesser use of machinery.
2. Wastage of By-products:
In the small scale production, it is not possible to make economic use of the by-products, as in the large scale production. By-products of the small producers generally go waste.
3. Less Use of Machines:
In the small scale production, there is less scope for the use of machines. As a result, these firms cannot take advantages of the use of the machinery.
hope it helps!!❤❤
Answered by
3
Answer:
Merits of small scale industries:
- There is an opportunity for entrepreneurship.
- There are lesser industrial disputes.
- A requirement of less capital.
- Small scale industries can create large employment opportunities.
- Earning foreign exchange for a country through export.
Demerits:
- They lack economies of scale.
-They have limited capital resources.
- They have less innovation capacity.
- The productivity of labor is low.
- Poorly trained workers due to low capital which entails poor access to technology.
Similar questions