The Current State of Small and Medium Enterprises in India: Challenges and Opportunities

This exploratory scope study examines research conducted in the domain of family-owned manufacturing businesses in India, particularly small and medium-sized enterprises (SMEs), which constitute more than 80% of the country’s business entities. Due to diverse constraints, SMEs face challenges and have opportunities that are not harnessed. Therefore, this study extracts the literature on SMEs and analyze it in terms of methodology, topics, publications and findings, aiming to develop an analyzed snapshot of the domain’s current state through a synthesized research corpus. The study’s objective is to identify gaps in the research repository due to both identified and unidentified limitations. Through the rigorous approach, our study’s outcome informs the agenda for future research and its rationale. As an exploratory study, this paper provides a snapshot for scholars to direct their studies to areas that are important to the domain and have been neglected, leaving not one but several gaps and directions. The key findings highlight the opportunities, such as working in trust-based networks, learning across generations to handle business, the use of resources and networks to have enough resilience during a crisis, and transitioning to green manufacturing practices despite having constraints. In terms of challenges, family-owned businesses often struggle with financial and governance risks. It is also observed that no SME-specific quality models are present in the literature. Resistance to innovation, managing family business interrelations and the choice between cost and sustainability are also found among common dilemmas. The outcome of this analysis offers clue for academics, policymakers and professionals working in family-owned businesses and SMEs in developing countries. JEL Classifications: D13, L25, L26, G32