Mapping the Competitive Advantage of SMEs in East Java, Indonesia

Diana Sulianti K. Tobing, Moehammad Fathorazz, Gusti Ayu Wulandari

Abstract

This article describes the situation and potential of SMEs in East Java Indonesia. Small and medium enterprises are essential to support the economic progress of a country. By using descriptive analysis and multiple regression then generated mapping. Mapping the characteristics and competitiveness of SMEs is done as a basis for gap analysis. If the current condition of Indonesian SMEs is known, benchmarking can be done by comparing ideal conditions or targets to be achieved in the face of global competition. The mapping generated from this research is expected to provide an overall picture of SMEs in disrict of Jember, Bondosowo, Situbondo and Banyuwangi, East Java Province, Indonesia, so that it can assist government and business actors in determining business strategies and policies. This study found the variables that significantly affect the competitive position are innovation ability, quality focus, customer loyalty, response to change, price advantage and marketing power. While the insignificant membership of the cooperative, it does not have a significant role for the creation of a strong competitive position. This is supported by the fact that most of the SMEs in eastern Java are not members of the cooperative. Similarly, business status with legal status and not and the use of intermediary traders is not a thing that affects the strength of competitive position.

Keywords

Potential Small and Medium Enterprises; Small and Medium Scale Enterprises; Mapping; Busi ness Actors; Business Strategies; Business Policies.

Full Text:

PDF

References

Autant-Bernard, C. 2001. Science and Knowledge Flows: Evidence from the French case. Research Policy. 30(7): 1069-1078.

Aqwu, M. O & Emeti, C. I. 2014. Challenges and Prospects of Small and Medium Scale Enterprises (SMEs) in Port-Harcourt City, Nigeria. European Journal of Sustainable Development. 3(1):101-114.

Aziz, N. N. A & Samad, S. 2015. Innovation and Competitive Advantage: Moderating Effects of Firm Age in Foods Manufacturing SMEs in Malaysia. Procedia Economics and Finance. 35: 256-266.

Ceptereanu, S. I. 2015. Competitiveness of SMES. Business Excellence and Management. 5(2): 55-67.

Centenaro, A & Laimer, C. G. 2017. Cooperative Relationship and Competitiveness in Supermarket Sector. Review of Business Management. 19(63): 65-81.

Davcik, N. S & Sharma, P. 2015. Impact of Product Differentiation, Marketing Investments and Brand Equity on Pricing Strategies: a Brand Level Investigation. European Journal of Marketing. 49(5/6): 760-781.

Fatrisia, A & Raharja, E. 2015. The Influences of Company Characteristics, Entrepreneurship Behavior and Bank Relationship Toward Small and Medium Enterprises (SMEs) Performance. Jurnal Dinamika Manajemen. 6(1): 1-12.

Gaspar, M. A., Borgato, F & Lima, I. C. 2013. Estratégia De Atuação Em Rede De Negócios: Estudo De Caso No Pequeno Varejo De Alimentos. Revista da Micro e Pequena Empresa. 7(1): 3-16.

Hill, J. 2001. A Multidimensional Study of the Key Determinants of Effective SME Marketing Activity: Part 2. International Journal of Entrepreneurial Behaviour & Research. 7(6): 211-235.

Hogarth-Scott, S., Watson, K & Wilson, N. 1996. Do Small Businesses Have to Practice Marketing to Survive and Grow?. Marketing Intelligence & Planning. 14(1): 6-18.

Kara, A. Spillan, J. E & DeShields, O. W. Jr. 2005. The Effect of a Market Orientation on Business Performance: a Study of Small-Sized Service Retailers Using MARKOR Scale. Journal of Small Business Management. 43(2): 105-118.

Konstantinos, B & Triantafyllopoulos, Y. 2014. SMEs Survival in Time of Crisis: Strategies, Tactics and Commercial Success Stories. Procedia-Social and Behavioral Sciences. 148: 639-644.

Laforet, S. 2008. Size, Strategic and Market Orientation Affects on Innovation. Journal of Business Research. 61(7): 753-764.

Martín-de Castro, G., Delgado-Verde, M., Navas-López, J. E & Cruz-González, J. 2013. The Moderating Role of Innovation Culture in the Relationship between Knowledge Assets and Product Innovation. Technological Forecasting and Social Change. 80(2): 351-363.

Mfaume, R. M & Leonard, W. 2004. Small Business Entrepreneurship in Dar Es Salaam-Tanzania: Exploring Problems and Prospects for Future Development. African Development and Poverty Reduction: the Macro-Micro Linkage, 13-15, October, Lord Charles Hotel, Somerset West, South Africa.

Mgeni, T. O & Nayak, P. 2015. Impacts of Entrepreneurial Leadership Style on Business Performance of Female owned SMEs in Dar es salaam, Tanzania. Journal of Milan, Entrepreneurship and Management. 4(2): 39-50.

Mittal, S., Gera, R & Batra, D. K. 2015. An Evaluation of an Integrated Perspective of Perceived Service Quality for Retail Banking Services in India. International Journal Bank Marketing. 33(3): 330-350.

Mourougane, A. 2012. Promoting SME development in Indonesia. OECD Economics Department Working Papers. Number 995. OECD Publishing.

Ngah, R., Wahab, I. A & Salleh, Z. 2015. The Sustainable Competitive Advantage of Small and Medium Entreprises (SMEs) with Intellectual Capital, Knowledge Management and Innovative Intelligence: Building a Conceptual Framework. Advanced Science Letters. 21(5): 1325-1328.

Pe’er, A. 2016. Human Resource-based Competitive Advantage: the Case of Motivational Rents. Journal of Entrepreneurship Organization Management. 5: 162.

Purnomo, M. 2011. Adopsi Teknologi oleh Usaha Mikro, Kecil dan Menengah. Jurnal Dinamika Manajemen. 2(2): 109-117.

Tambunan, T. 2008. Development of SME in ASEAN with Reference to Indonesia and Thailand. Journal of Economics. 20(1): 53-83.

Tobing, D. S. K. 2016. The Effect of Compensation, Career Development, Work-Family Support on Job Satisfaction. Polish Journal of Management Studies. 14(1): 206-213.

Sin, K. Y., Osman, A., Salahuddin, S. N., Abdullah, S., Lim, Y. J & Sim, C. L. 2015. Relative Advantage and Competitive Pressure towards Implementation of E-commerce: Overview of Small and Medium Enterprises (SMEs). 7th International Economics & Business Management Conference, 5th & 6th October 2015.

Singarimbun, M & Effendi, S. 2015. Metode Penelitian Survai. Jakarta: LP3ES.

Van der Vaart, H. J & Gibson, T. 2008. Defining SMEs: a Less Imperfect Way of Defining Small and Medium Enterprises in Developing Countries. Brooking Global Economy and Development Website Publication Retrieved.

Wijetunge, W. A. D. S. 2016. Service Quality, Competitive Advantage and Business Performance in Service Providing SMEs in Sri Langka. International Journal of Scientific and Research Publications. 6(7): 720.

Zemplinerová, A. 2010. Inovační aktivita firem a konkurence. Politická ekonomie. 58(6): 747-760.

Zheltoukhova, K & Suckley, L. 2014. Hands-On or Hands-Off: Effective Leadership and Management in Small to Medium Size Enterprises. Chartered Institute of Personnel And Development (CIPD).


View Counter: Abstract - 9 and PDF - 6

Refbacks

  • There are currently no refbacks.


Add comment