PROJECT REPORT ON A Comperative Study of Cottage, Village&Small scale Industries

SUBMITTED TO:
Madm. Rashmi aghniotri Faculty of Law

SUBMITTED BY:
Mohan Singh Shekhawat BBA-LLB 1st year Roll No. 12

ACKNOWLEDGEMENT:
I owe a great many thanks to a great many people who helped and supported me during the writing of this Project report. My deepest thanks to Lecturer, [Madm. Rashmi aghniotri] the Guide of the project for guiding and correcting various documents of mine with attention and care. He has taken pain to go through the project and make necessary correction as and when needed. I express my thanks to the Dean of JAI NARAIN VYAS UNIVERSITY,Jodhpur for extending his support Thanks and appreciation to the helpful people for their support.I would also thank my faculty members without whom this project would have been a distant reality. I also extend my heartfelt thanks to my family and well wishers

INDEX:
S.NO

Description
INTRODUCTION PRESENT STATUS Definations

Pg No. Teacher s Remarks

1 2 3 4 5 6 7

4 5 5

Definition (SSI) Undertakings 6 in India Importance Problems Faced

7 9

Referance

12

INTRODUCTION
For providing gainful and productive avenues of employment to the growing labour forceand relieve unemployment and underemployment in rural backward areas, a massiveprogramme of industrialisation in the shape of village and cottage industries would have to belaunched. This assumes added significance in the face of limited opportunities in theagricultural pursuits and for putting a check to the large scale migration to urban areas. Thedispersed character of the village and cottage industries facilitate the utilisation of scatteredresources, of the rural backward area. Set up your own small scale enterprise, increase your income and improve your standard of life A small scale industry provides a steady source of income throughout the year The basic idea is to become selfreliant through utilizing locally available resources and skills. Steps to be followed for starting a small scale/village/cottage industry? 1.Finance 2.Registration / Statutory Licenses and Clearances 3.Repayment of Loans 4.Production 5.Marketing 6.Recruiting Personnel 7.Installation of Machinery 8.Preparing a Project Report 9.Selecting Your Product 10.Assessing Profit Generation 11.A Healthy and Wealthy Enterprise The Khadi and Village Industries Commission (KVIC) is a statutory body formed by the Government of India, under the Act of Parliament, 'Khadi and Village Industries Commission Act of 1956'

Khadi and Village Industries Commission Abbreviation KVIC Formation 1956 Headquarters Mumbai Parent organization Ministry of Micro, Enterprises Staff 76.78 lakh (2004-2005) [1] Website KVIC Official website

Small

and

Medium

PRESENT STATUS: #In the context of backward areas development, because of the various inherent limitationsto the growth of the organised industries sector in these areas and because of the insufficientpotentialities of agricultural development and the migration to urban areas whereopportunities are already limited, the importance of the unorganised sector is significant. Inaddition, on account of the predominantly rural character of the backward areas, thepromotion of village and cottage industries assume a very significant role. # In our economic situation, with scarcity of capital and abundance of labour, our choicenaturally has to be biased towards techniques making use of capital-saving or labourintensivetechniques. The techniques chosen need to take full cognisance of spread effect,need to protect employment, enhance productivity, develop skills and meet the needs of localconsumption. However, in any such adoption, economic viability needs to be in the forefront.

Definations
Cottage IndustryDefination:
An industry where the creation of products and services is home-based, rather than factory-based. While products and services created by cottage industry are often unique and distinctive given the fact that

they are usually not mass-produced, producers in this sector often face numerous disadvantages when trying to compete with much larger factory-based companies. When a worker produces something with his simple tools, with the help of his family members only, then he is said to be running a cottage industry

Village IndustryDefination:
Any Industry that is located within a rural area, where the Fixed Capital Investment per Artisan (weaver) does not exceed Rupees One Lakh.The Fixed Capital Investment can be changed by the Central Government of India whenever it so requires.

Small scale buisness/industriesDefination:

A small business is a business that is privately owned and operated, with a small number of employees and relatively low volume of sales. Small businesses are normally privately owned corporations, partnerships, or sole proprietorships. The legal definition of "small" varies by country and by industry, ranging from fewer than 15 employees under Fair Work Act 2009, 50 employees in the European Union,[citation needed] and fewer than 500 employees to qualify for many U.S. Small Business Administration programs. Definition of Small Scale Industrial (SSI) Undertakings in India on following basis: 1.Policy Support 2. Fiscal Support 3. Credit Support 4. Infrastructural Support 5. Technological Support and Quality Improvement 6. Marketing Support 7. Streamlining Inspections/Rules and Regulations

- For audit and safety purposes. 8. Entrepreneurship Development 9. Facilitating Prompt Payment 10. Rehabilitation of sick units 11. Promoting Rural Industries TINY SECTOR 13. Policy Support 14. Credit Support 15. Infrastructure Support 16. Technological Support 17. Marketing Support

Importance
Cottage industries, village industries, small scale industries, handicrafts and large scale industries are the various terms which are used for different types of production works, according to their size and production.

Importance of cottage industry:

The importance of cottage industries is very great for rural as well as urban areas. In villages, farmers can carry on their cottage industries side by side with their main occupation of agriculture. They are important for them as they provide opportunities for part-time employment. In urban areas also the poor can start some cottage industries with their own limited resources. They are indispensable for a poor country like India. In cottage industries the question of the exploitation of workers does not arise. The worker and his family being both the employer and the employee themselves, get all the earning from their business. Even if in some cases hired laborers are employed, the relations between them and the employer remain healthy.Big machines are labor saving devices. They are not used in cottage industries. So, if they are

encouraged, more and more people get employed. Besides this, they are good means for providing part-time employment. The tendency towards centralization is inherent in large scale industries. This leads to over-crowding and congestion in the towns. Children and women are employed in big industries. Corruption becomes rampant. But handicrafts solve all these problems. They are mostly run in the homes of the workers. So the housing problem does not arise, other social ills are also removed.

Importance of village industry:

With an increasing demand for sustainable building and design practices within the retirement village industry, the importance of being green is now a reality. Unfortunately this demand has spawned a corresponding increase in the green-washing of products in the market place. To avoid this green washing, consideration needs to be given to the companys wider approach to manufacturing and their associated impact on the environment. InterfaceFLOR is one such example of a sustainable manufacturing company. The RVA works closely with industry experts to bring attention to its members the very best information on quality products and services.As more and more retirement villages are looking forward to help the environment, InterfaceFLOR are leading the way to provide innovative solutions to villages, helping them to take advantage of significant savings.As more retirement villages are becoming environmentally conscious, identifying sustainable product manufacturers for procurement is a significant challenge.

Importance of small-scale industry/business:

A small business can be started at a very low cost and on a part-time basis. Small business is also well suited to internet marketing because it can easily serve specialized niches, something that would have been

more difficult prior to the internet revolution which began in the late 1990s. Adapting to change is crucial in business and particularly small business; not being tied to any bureaucratic inertia, it is typically easier to respond to the marketplace quickly. Small business proprietors tend to be intimate with their customers and clients which results in greater accountability and maturity. Independence is another advantage of owning a small business. One survey of small business owners showed that 38% of those who left their jobs at other companies said their main reason for leaving was that they wanted to be their own bosses.[citation needed] Freedom to operate independently is a reward for small business owners. In addition, many people desire to make their own decisions, take their own risks, and reap the rewards of their efforts. Small business owners have the satisfaction of making their own decisions within the constraints imposed by economic and other environmental factors.

Problems Faced Problems with cottage & village industries:

1 Efforts should be directed towards upgradation of technology so that the artisans move outof their poverty trap at the earliest and their dependents enjoy ever increasing livingstandards. 2. The criterion of economic viability does not mean that subsidies can be- dispensed with.Subsidies will be necessary to expand village and cottage industries particularly in the earlierstages. 3. In the existing set up for the unorganised sector: the available technology is not fullyutilised, produc tivity is quite low and much of the value added is syphoned off byexploitative middlemen. 4. The practical course is to introduce modernisation of techniques and improve the skills andmake the worker capable of enhancing his productivity and his earnings so as to enable himto meet at least the .basic necessities of life and come out of the clutches of poverty .

5. The artisan himself finds against odds at each level of his operations, be it the purchase ofraw materials, the marketing of the products, the arrangement of credit, access to institutioncover, etc. His weak sustaining and bargaining power is exploited by all and sundry, naturallyto his utter disadvantage. 6. It is not enough that the value added is improved, but that; a larger portion of it reaches theworker. 7. There is a pattern of regional concentration in various household industries because of thehistorical growth process. 8. The statisticaFpiclure of employment in household industries shows an alarming declineeven after allowing for definitional changes. Backward areas will be the natural victims ofthis decline where their ability to attract modern industry, which replaces many of thesedeclining activities, is limited. Hence protection and promotion of village and cottageindustries becomes an important element in any strategy for backward area development. 9. Public policy must take into account the low level of earnings and the exploitation in thissector. Hence policy must be directed not merely at preserving these industries but atupgrading them in terms of technology so that earnings of artisans can be pushed above the poverty line.

Problems with small-scale industries/business:

Small businesses often face a variety of problems related to their size. A frequent cause of bankruptcy is undercapitalization. This is often a result of poor planning rather than economic conditions - it is common rule of thumb that the entrepreneur should have access to a sum of money at least equal to the projected revenue for the first year of business in addition to his anticipated expenses. For example, if the prospective owner thinks that he will generate $100,000 in revenues in the first year with $150,000 in start-up expenses, then he should have no less than $250,000 available. Failure to provide this level of funding

for the company could leave the owner liable for all of the company's debt should he end up in bankruptcy court, under the theory of undercapitalization. In addition to ensuring that the business has enough capital, the small business owner must also be mindful of contribution margin (sales minus variable costs). To break even, the business must be able to reach a level of sales where the contribution margin equals fixed costs. When they first start out, many small business owners underprice their products to a point where even at their maximum capacity, it would be impossible to break even. Cost controls or price increases often resolve this problem. In the United States, some of the largest concerns of small business owners are insurance costs (such as liability and health), rising energy costs and taxes. In the United Kingdom and Australia, small business owners tend to be more concerned with excessive governmental red tape. Another problem for many small businesses is termed the 'Entrepreneurial Myth' or E-Myth. The mythic assumption is that an expert in a given technical field will also be expert at running that kind of business. Additional business management skills are needed to keep a business running smoothly. Still another problem for many small businesses is the capacity of much larger businesses to influence or sometimes determine their chances for success.

BOOKS:
$ Economic Enviroment:Dave &Mathur $ Economic Enviroment of Business:M.Adhikary $ Business Enviroment:G.S.Sudha

NEWSPAPER:
$ hindustan times $ times of India $dainik bhaskar $rajasthan patrika