Ancillary Development




Objectives of Ancillary Development:


  1. Employment Opportunities –

                 Development of employment opportunities must be coupled (along) with the growth of entrepreneurship in different fields & different parts of the country.



  1. Equitable Distribution –

               Dispersal of industrial activities in various regions are bringing out the desired equitable distribution of economic power.


  1. Economies of Scale –

                    There should be development of single or a multiple discipline expertise in different field in order to bring about economic of scale.


  1. Increasing Productivity –

                     There should be an increase in the productivity of the small scale units.  


  1. Effective Solution –

                     Its aim is to provide an effective solution to the marketing problems of small enterprises in the initial period or before they reach the break even point.


  1. Provide Choice –

                    A firm producing final products has a choice either to manufacture components & use specialized equipment from other units.


  1. Other –

The rise in the cost of capital has also been another reason for the growth of ancilliaries.

If the demand for component is small, the scale of economies & saving would not be realized. In such a case, it would be advantageous to buy such inputs from specialized sub contractor firms.



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