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.
Highlights
The local government has made several programs to promote SMEs such as the effectiveness of micro small and medium enterprises (SMEs) and the settlement of business licensing issues (Mfaume & Leonard, 2004)
The problems faced by SMEs are very complex, especially since the penetration of outsourced products with very competitive prices makes the perpetrators in this industry face a very big problem
Business Identity The results show that SMEs in East Java is a household industry that is characterized by the same business location as the location of the residence
Summary
The local government has made several programs to promote SMEs such as the effectiveness of micro small and medium enterprises (SMEs) and the settlement of business licensing issues (Mfaume & Leonard, 2004). Provide guidance on standardization and design of industrial products as well as provide facilities of ISO, SNI, and Batikmark certification. Efforts made by the government in general consists of two aspects, namely, infrastructure development and construction soft infrastructure. The priority of activity program for SMEs is by developing Agroindustry as much as 671,058 units of SMEs, standardization of product for SMEs, and making 5 smelter consisting of 2 Foreign Investment and 3 Domestic Investment. SMEs is very difficult to be a big business (Zheltoukhova & Suckley, 2014; Mgeni, 2015; Mgeni & Nayak, 2015)
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