Funding is tighter, rules are tougher, and customers are changing fast. Learn step-by-step tactics, Indian examples, and 2026 schemes to keep your business thriving when disruption hits.
Keep Your Business Growing Amid Market Shifts and Turbulent Times
Indian businesses don’t fail only because the idea is bad. They usually struggle when the market changes faster than the business does—funding slows, rules tighten, customer habits shift, or a global shock hits supply and demand. In India, MSMEs and startups are feeling this strongly as funding becomes more selective, inflation stays sticky, and regulations get tighter in sectors like fintech and lending.
1. Understand the New Reality Quickly
When disruption strikes, speed of understanding is your first advantage. Many MSMEs today struggle with delayed payments, inflation above 4.5–5%, and changing policies, which squeeze margins and cash flows.
What you should do in the first 30 days:
a) Map what has actually changed
- Demand: Are key customer segments ordering less or changing what they buy?
- Supply: Are input prices, shipping times, or vendor reliability getting worse?
- Rules: Has RBI, SEBI, or any sector regulator changed something that touches you? Fintechs saw this clearly with tighter compliance and KYC rules in recent years.
b) Segment the impact
- List products, services, or regions most affected.
- Mark them red (high impact), amber (medium), green (low) to decide where to act first.
c) Talk to customers, not just read reports
- Run quick WhatsApp/Google forms surveys with existing customers.
- Ask: “What is your biggest challenge right now?” and “What would you still pay for even in a downturn?”
This clarity helps you avoid random reactions and focus on the real pain points.
2. Strengthen Cash Flow and Build Runway
Funding has not disappeared in India, but capital has become more careful and selective. That means the businesses that survive are the ones that manage cash like oxygen, not like tap water.
Practical cash steps you can take this quarter
a) Target at least 6–12 months of runway
- Calculate your monthly fixed burn (salaries, rent, essential tools).
- Decide where to cut “nice-to-have” spends for 6 months without killing core growth.
b) Fix receivables and delayed payments
- Indian MSMEs are heavily hurt by late payments from larger buyers.
- Use written payment terms, small early-payment discounts (for example, 1–2% discount for payments within 7–10 days), and automated reminders via accounting software.
c) Use government-backed loan schemes intelligently
- PM Mudra Yojana: Collateral-free loans up to ₹20 lakh under Shishu, Kishore, and Tarun categories for manufacturing, trading, and services, useful for micro and small units needing working capital.
- CGTMSE: Gives credit guarantees for collateral-free loans to MSMEs, making it easier for you to convince banks to lend.
Table: Cash and Funding Playbook for Indian Businesses
| Area | What’s Going Wrong in India | What You Can Do Now | Where to Look for Support |
|---|---|---|---|
| Delayed customer payments | MSMEs face chronic late payments from larger corporates, disrupting cash flow. | Shorten credit cycles, offer small early-payment discounts, automate reminders via invoicing tools. | Link invoices to TReDS platforms once available through Budget 2026 initiatives. |
| Rising costs & inflation | RBI projects inflation around 4.8% with spikes, raising input and salary costs. | Renegotiate vendor contracts, buy in bulk where possible, trim non-essential expenses. | State-level MSME support programs, cluster-based procurement support. |
| Access to credit | Many MSMEs remain under-funded or dependent on informal credit. | Prepare simple MIS, GST returns, and bank statements to strengthen your case with lenders. | Mudra, CGTMSE-backed loans, Stand-Up India, and new SME Growth Fund announced in recent budgets. |
| Funding for startups | Startup funding dropped ~38% YoY in Q3 2025, with investors becoming more selective. | Focus on unit economics, reduce cash burn, extend runway before raising. | Sector-focused VCs, family offices, revenue-based financing platforms. |
3. Double Down on Digital, Data, and Speed
Digital adoption is no longer optional; it’s the baseline. A large share of Indian MSMEs still lack proper digital infrastructure or e-commerce integration, making it hard to compete with bigger players.
Start with simple digital wins
a) Sales and marketing
- Use WhatsApp Business to broadcast offers, track conversations, and maintain customer lists.
- List on relevant marketplaces (Amazon, Flipkart, Industry-specific B2B portals) to reach new buyers.
b) Operations and decisions
- Use basic cloud tools (Google Sheets, Zoho, Tally, or similar) to track daily sales, collections, and major expenses.
- Review a simple dashboard weekly: revenue, top customers, collection delays, and top-selling SKUs.
c) Speed of execution (Agile mindset)
- Instead of big annual plans, work in 2–4 week cycles.
- Pick one improvement (e.g., reduce delivery time by 1 day), test it quickly, measure results, and then scale if it works.
This combination of digital tools and short feedback loops makes your business flexible and responsive to market shocks.
4. Diversify Products, Markets, and Supply
One major risk NITI Aayog and other bodies highlight is concentration—too much revenue from too few customers, products, or markets. In a disruption, those concentration points break first.
Ways to de-risk your business model
a) Diversify what you sell
- Add lower-ticket or “essential” versions of your product for down markets.
- Convert services into packages or subscriptions to smooth recurring revenue.
b) Diversify who you sell to
- Explore new customer segments: example, a B2B SaaS serving startups can also target SMEs or traditional businesses.
- Consider cross-border or interstate markets where demand is still strong and logistics are manageable.
c) Diversify how and from whom you source
- Avoid relying on a single supplier for critical inputs.
- Have at least one backup vendor or region for key materials.
Table: Examples of Indian Businesses Pivoting and Diversifying
| Company / Type | Original Focus | Disruption Faced | Pivot / Diversification | Result / Learning |
|---|---|---|---|---|
| Food delivery platforms (e.g., Zomato/Swiggy) | Restaurant deliveries | COVID lockdowns, dine-in shutdowns | Expanded contactless deliveries, groceries, and essentials. | Became essential services instead of “luxury convenience”. |
| Manufacturing MSMEs (textiles, garments) | Fashion exports | Global demand crash, supply chain issues | Shifted to PPE kits, masks, and medical textiles. | Survived by moving to “health-essential” categories. |
| Tech startups (across sectors) | Rapid growth focus | Funding correction and more selective capital in 2025. | Pivoted to profitability, cut non-core projects, focused on high-margin segments. | Investors began rewarding sustainable growth over pure speed. |
5. Use Government Support as a Strategic Lever
Indian policy is increasingly focused on making MSMEs resilient, not just supporting them in name only. Budget 2026, for example, announced a ₹10,000 crore SME Growth Fund and a top-up to the Self-Reliant India Fund to support micro enterprises. NITI Aayog and the Ministry of MSME are pushing for better credit, technology, and export readiness.
Key schemes and how to plug into them
a) Mudra loans (PMMY)
- Ideal if you are a micro or small business needing up to ₹20 lakh.
- Shishu, Kishore, and Tarun categories make it easier to match the loan size with your growth stage.
b) CGTMSE (Credit Guarantee Fund Trust for Micro and Small Enterprises)
- Helps you obtain collateral-free loans because the government shares the risk with banks.
- Especially useful if you lack property or large assets.
c) New Budget 2026 measures
- SME Growth Fund: Targets high-potential SMEs looking to scale.
- Revival of traditional industrial clusters: Upgrading technology and credit support for older industrial hubs.
- TReDS and GeM integration: Better visibility of payment cycles and chances to discount receivables earlier.
The key is not just “knowing” these schemes but integrating them into your long-term capital strategy so you’re less dependent on expensive informal finance.
6. Build a Resilient Team and Culture
Data shows that resilience in MSMEs is strongly linked to people capabilities, training, and openness to learn new tools. During disruption, your team needs clarity, not confusion.
Practical culture levers
a) Communicate honestly and regularly
- Share the reality: what is changing, what the plan is, and how each person’s role matters.
- Short weekly town halls or team huddles can bring stability.
b) Cross-skill your team
- Train key employees to handle more than one function (sales + basic finance; operations + customer support).
- This makes you less vulnerable if one person leaves or is unavailable.
c) Reward problem-solving, not only results
- Encourage employees to suggest cost savings, process improvements, or new product ideas.
- A small reward system (recognition, small bonuses, flexible perks) keeps people engaged through tough periods.
A culture that learns, adapts, and communicates openly can respond much faster than one that waits passively for instructions.
7. Formal Risk Management and Business Continuity
Middle-sized and growing businesses in India often ignore formal risk management until they face a serious crisis. Studies on MSMEs highlight that structured risk planning and technology adoption significantly improve resilience during volatility.
Core elements you should put in place
a) Risk register
- List key risks (regulatory, funding, supply, cyber, climate) and rate them by likelihood and impact.
- Decide simple mitigation: backup vendors, insurance, cyber hygiene, offsite data backups.
b) Business continuity plan (BCP)
Define what you will do if:
- Office or factory cannot be used for 30–60 days.
- 30–40% of your workforce is unavailable.
- You face a sudden 40% drop in demand or a 40% spike in demand.
Include who decides what, how you’ll communicate with staff and customers, and how you’ll operate in “bare minimum mode”.
c) Insurance and cyber protection
- Consider business interruption, asset, and cyber insurance if your business is data or operations heavy.
- Basic steps like multi-factor authentication and regular backups reduce disruption from cyber incidents.
8. Keep Selling: Smart Marketing in Tough Times
When markets get rough, many businesses cut marketing first—often a mistake. Evidence from downturns shows that companies staying visible and relevant come out stronger once conditions improve.
Lean, disruption-ready marketing
a) Focus on your best customers first
- Identify your top 20% customers by revenue and profitability.
- Reach out individually—ask what they need now and design offers tailored to them.
b) Use content and education
- Share simple, useful content: “How to reduce costs using our product”, “What has changed in the market this month?”
- Use LinkedIn, Instagram, and YouTube shorts to stay top-of-mind with low cost.
c) Measure, don’t guess
- Track leads, conversion rates, and repeat purchases.
- Kill marketing channels that don’t perform within 2–3 months and double down on those that do.
9. Create Your Own “Resilience Dashboard”
To make all of this practical, build a simple monthly dashboard you can view on your phone.
Suggested 8-number dashboard:
- Monthly revenue
- Gross margin %
- Cash in bank (months of runway)
- Average receivable days
- Top 5 customers’ share of revenue (%)
- New leads generated this month
- Digital sales ratio (online vs offline)
- Training hours or learning sessions completed by team
Tracking these metrics consistently helps you act early instead of reacting late.