Quality and Standards in India
Quality for Small Firms: ZED
How the ZED certification scheme helps small firms improve quality with "Zero Defect, Zero Effect", and why quality upgrading is hard for MSMEs.
Small firms often struggle to meet quality standards.
Barriers
- Costs of testing and certification.
- Skills in quality management.
- Technology and equipment.
- Information about standards.
ZED scheme
The MSME Sustainable (ZED) Certification Scheme, relaunched in 2022, promotes “Zero Defect, Zero Effect”:
- Zero defect: consistent quality.
- Zero effect: minimal environmental impact.
Levels
- Bronze, Silver and Gold certification.
- Subsidies cover much of certification costs, especially for micro firms.
Benefits for firms
- Better access to large buyers and exports.
- Incentives in government procurement and bank loans.
Uptake
Lakhs of MSMEs registered, but most at the basic Bronze level.
Why quality matters for growth
Global supply chains demand consistent quality. Upgrading small firms helps them join value chains.
The auto supplier
A small parts maker earns ZED Silver certification after improving processes. A large carmaker adds it as an approved supplier.
Thinking quality is only for big companies
Small firms need quality to join supply chains.
Key takeaways
- Small firms face cost and skill barriers to quality.
- ZED promotes zero defects and zero environmental effect.
- Subsidies support certification.
- Quality helps MSMEs join value chains.
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