While well-established Indian companies like Bisleri, Parle Products, Patanjali, and Amul had figured out the value of being a Swadeshi company, new Indian startups are yet to learn the ‘Vocal for Local’ is an advantage.
For those of you who have tuned out the news to maintain sanity, on May 13, 2020, India’s Prime Minister, Narendra Modi incited the nation to buy, value, and feel proud of local products.
“These times of crisis have taught us the importance of going local about buying products, local is what will save us. Even in these life-altering moments, we should not forget our goals. It is time to be vocal for local,” Mr. Modi said.
Read more: How to turnaround a loss-making startup?
Why should Indian startups care?
There have been various efforts in the past to help the Indian startups grow and achieve success, globally. So what difference does the ‘Vocal and Local’ make on Indian startups and business owners?
People a.k.a customers care
There is an increase of humanity in people worldwide due to the pandemic, also, Prime Minister has successfully encouraged loyal citizens. Thus, people are paying attention. Above that, the trust factor and the nationalist sentiment are greater in effect than in any other program. This is mainly because this program is seen as the continuation of the Swadeshi Movement, which worked wonders during our fight for Independence
All the other cool companies are doing it!
Understandably, startups look up to successful companies’ statistics, positioning, and strategies to eliminate the potential risk factors.
- Dabur: The company has products that reach over 100 countries. It took digital media to support and market its series of Vocal for Local campaigns.
- Parle Products: Leading biscuit and candy making company supported the program by advertising its biscuits as- Bharat ka Apna Biscuit (India’s own biscuits).
- Other companies Frooti, Appy Fizz, SpiceJet, and ITC have been successfully using their innovative campaign additions to the program.
Related: Guide to register your startup
How can Indian startups benefit from Vocal for Local?
It is easier for Indian startups to go global from local due to the lockdown getting subsided, and the potential customers coming out in the market with the perpetuated patriotism
MSME- Ministry of Micro, Small, and Medium Enterprises
To push ‘Vocal for Local’ and support the program pragmatically, an unload of the amount of Rs. 20 lakh crores was announced under Atmanirbhar Bharat Abhiyan Package which supports MSMEs profoundly.
Funding and loan reforms for startups
India’s finance minister, Nirmala Sitharaman, gave details about reforms to support stressed businesses. The program’s one of the important objectives was to focus on ‘resume business activity.’ One of which was: an announcement of a collateral-free fund scheme amounting up to Rs. 3 lakh crores, especially for MSMEs.
Some other industries like power distribution, real estate, and NBFCs (non-banking finance companies) also got the attention that they have been deprived of from other economically benefiting programs.
Learn more about funding for Indian Startups: Startup funding options in India
Intended to benefit 2 lakh startups, a provision of Rs. 20,000 crore has been expedited as subordinate debts. Also, the amount valuing to Rs. 4,000 crores have been issued by the government to GTMSE (Credit Guarantee Fund Trust for Micro and Small Enterprises)
As the definition of MSMEs underwent a change, under the new definition:
- Manufacturing and services enterprises with a turnover of more than Rs. 5 crores and an investment amount up to Rs. 1 crore fall under micro-enterprises.
- Small enterprises will be the term used for companies with an investment capacity of Rs. 10 crores, whereas the turnover should be of Rs. 50 crores.
- The companies with a turnover of Rs. 100 crores and an investment of Rs. 20 crores for producing goods or services will be entitled as medium enterprises.
Therefore, the ‘Vocal for Local’ is most certainly helpful to the Indian startup ecosystem as many of these startups would fall under MSME. These startups can grow to a certain size without losing their MSME tag.
Above that, it presents a great opportunity for Indian startups to integrate themselves in the GVC (Global Value Chain) and get global from local.
How can you integrate your startup or MSME to GVC, and why?
Almost 53% of businesses are extremely disrupted during the lockdown period. To which India’s Prime Minister has ensured the removal of expected hurdles to attract most of GVC.
Your MSME can integrate its functions into the global market
- either through directly engaging with the global players
- or by being a part of the supply chain. It can do so by producing for the bigger firms which are linked to the global vendors.
Lessons from deep-rooted Indian companies
There are numerous reasons for people to support a local business like- value for a new product or concern for the community. One of the biggest reasons is- trust in another local business. Customers put more trust in startups of a community of which other companies have found success. Some of the successful Indian brands which started local, as you would, but are global and enjoying the fruition now are:
- Asian Paints- It is Asia’s 3rd and India’s largest paint company. Initially named Asia, this company found success after a fair share of paying their dues. It has one of the most inspiring stories any new startup can learn from. The pitfalls, the PR, the work to put in, and many other lessons. This company has been filling colors in our lives and homes for 7 decades now, we all remember- har ghar kuch kehta hai…
Read the full story: How Asian Paints went global from local?
- Air India- It has changed variable names From Tata Services, Tata Airlines, and landed to Air India after World War II. In addition, this airline company has faced struggles more than most of us know. Withstanding all those it still serves the country during the pandemic.
- Fevicol- This company has a song that is based on its concept, well, somewhat. If this is not a success, what is? From its catchy advertisement to its two-elephants-logo branding, we remember and appreciate it all.
Some other companies like- Mahindra & Mahindra, Rooh Afza, Bajaj Auto, and Old Monk have taught if they can succeed, so can you.
Given the chance to Indian startups to take advantage of the vocal for local, the future will surely have newly globalized businesses and economies.