In spite of a number of economies of large scale production, large entrepreneurs have not shown a substantial growth. Most of large scale industries are located in urban and metropolitan cities where it becomes difficult task to avail infrastructural facilities.
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They have a great expose to professional management. They also require huge amount of capital outlay.
The followings are some of important reasons which create hurdles in the way of growth of large entrepreneurs.
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i. Large enterprises have a wide exposure to professional management which becomes beyond the reach of most enterprises.
ii. Large scale industrial units are mostly situated in urban and metropolitan cities. It involves much expenditure in providing infrastructural facilities.
iii. Large scale industries require on investment of Rs. 5 cores or more, it becomes beyond the reach of large entrepreneurs.
iv. Large enterprises make better use of specialized and skilled personnel and skilled personnel. There is dearth of skilled and specialized personnel which provide obstacles in the way of growth of large entrepreneurs.
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v. Large scale industrial units are basically market-oriented because they produce goods for masses. This state of market oriented production puts bottleneck on the way of growth of entrepreneurs.
vi. The owners of large scale enterprises cannot exercise control over all the affairs of company.
vii. As there is complete separation of ownership and management, there is always conflict between owners and managers. Because of this reason, it has been pointed out that large enterprises are not bed of roses but full of thorns.
viii. There is lack of co-ordination between different departments.
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ix. The working capital cost of operation of large enterprises is too high.