Rising operational costs threaten small businesses

Small and medium enterprises (SMEs) across Bangladesh are under growing strain as operational costs continue to climb. Frequent increases in electricity tariffs, rising raw material prices, costly transportation, and persistent inflation have sharply reduced profit margins for small entrepreneurs. Many SMEs in retail, light manufacturing, and food processing are finding it increasingly difficult to maintain cash flow as expenses rise faster than sales.
This trend poses a serious risk to the broader economy. SMEs are major contributors to employment and domestic production and any slowdown in this sector is likely to disrupt supply chains, reduce household incomes and undermine economic stability. If small businesses continue to lose competitiveness, the country may face reduced private investment, lower productivity and a slower path to economic recovery.
To safeguard SMEs, the government may consider offering targeted incentives, including subsidised utility rates for small firms, simplified access to credit and streamlined import procedures for essential raw materials. Strengthening support for SMEs will help protect employment and reinforce the foundations of sustainable economic growth.

Masaba Hossain Shoptorshi
Dhaka
masaba.shoptorshi@northsouth.edu