How does entrepreneurial orientation affect the business performance of coffee shop MSMEs in Indonesia?

M. Khalifatul Ardhi,Rubiyo Rubiyo,C. Indrawanto,Jangkung Handoyo Mulyo,Irham Irham

doi:10.1051/e3sconf/202130603011

Abstract

The increasing growth of the coffee shop business with a fast and attractive expansion as a food & beverage industry in urban areas of Indonesia, especially Special Region of Yogyakarta has led to business competition between micro, small, and medium enterprises (MSMEs) which are required to use their ability to adapt, be competitive and improve business performance. The entrepreneurial orientation is claimed to important contributions to business success. This study aims to analyze the effect of entrepreneurial orientation on business performance. Partial Least Square-Structural Equation Modeling (PLS-SEM) analysis method is used to examine the effect of five dimensions of entrepreneurial orientation (innovative, proactive, risk-taking, autonomy, and competitive aggressiveness) on business performance. This research was conducted at 80 coffee shop MSMEs with the sampling technique using convenience sampling. The results showed that the dimensions of proactive, autonomy, and competitive aggressiveness were found to have a positive and significant effect on business performance, while the innovative and risk-taking dimensions did not affect significantly on business performance.

Highlights

The coffee business is currently an attractive and growing industry and has a broad impact on the Indonesian economy. This is driven by an increase in people's coffee consumption and a shift in consumer preferences for iced coffee drinks as the latest trend with price offers starts at 1.2 U.S dollars which can be found at local coffee shops
The beginning of the emergence of coffee shop outlets as a business engaged in the food and beverages industry involved the micro, small and medium enterprise (MSMEs) sector as a modern business with strategies and development supported by the use of digital technology
The increasing growth of the coffee shop business with rapid expansion in recent years is generally located in big cities, one of which is in the Special Region of Yogyakarta

Summary

Introduction

The coffee business is currently an attractive and growing industry and has a broad impact on the Indonesian economy. The increasing growth of the coffee shop business with rapid expansion in recent years is generally located in big cities, one of which is in the Special Region of Yogyakarta. They have a new lifestyle to enjoy coffee at the cafe so that the coffee shop business in the area is growing and growing rapidly. This results in intense competition among coffee shop entrepreneurs, so they are required to use their business strategies in order to win the competition and provide maximum satisfaction to their customers

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Methods

Conclusion