SMEs MARKETING STRATEGIES DEVELOPMENT IN IMPROVING COMPETITIVE ADVANTAGES (STUDY ON CENTER OF MAKING BEADS IN JOMBANG)

Abstract

INTRODUCTION:The increasing business competition in this globalization era is something unavoidable among business players. The success of SMEs in the globalization era depends on planning and implementation of own strategies (Porter, 1980). Although SMEs play an important role in the national economy, SMEs still have low competitiveness. The study results from Center for Industry SME and Business Competetition Studies of Trisakti University shows that the competitiveness of the micro, small and medium enterprises in Indonesia is the lowest compared to member countries of the Asia Pacific Economic Cooperation (Sarwani, 2012).Low competitiveness impact company's long-term existence. Competitive advantage is one factor to be considered by companies to achieve its objectives. (Porter, 2008) said that the competitive advantage is the most important thing in terms of a company's performance to compete and grow so they can defend themselves from the market's competitive pressures.The competitive advantage for the company is a company's ability to provide added value to its products. The added value that will attract consumers who must be willing to buy your products that have the same benefits as competitors but at lower prices, or have unique characteristics compared with competitors, but at a higher price (Porter, 1985). SMEs that have a competitive advantage manufacture products that are competitive. Competitive products marked with a quality product, in accordance to the wishes of consumers and be able to compete with similar products and has its own uniqueness (Song & Parry, 1997)(Sriyana, 2010), in his research on SMEs in Bantul, found that SMEs are still facing fundamental problems such as product quality, marketing and business sustainability. Marketing problems faced by SMEs in general is limited market access. They were only able to sell their products in the area where it is produced and have not been able to reach a larger extent.The competitive advantage for the company is that the company is implementing a strategy that cannot be replicated by its competitors (Barney, 1991). According to (Knight, Summer 2000), the company's potential is shown by the company's business strategy in responding to the challenges and opportunities caused by the business environment. Company implements its strategy in order to attract customers and deal with a variety of environmental problems, such as competitors and suppliers.Strategy is everything executed by the company to achieve its objectives. According to (Rostro & Grudzewski, 2008), understand the rules of marketing can help companies determine the strategies undertaken in gaining a competitive advantage. (Varadarajan & Cunningham, 1995) states that the purpose of such marketing strategy is to achieve a competitive advantage. Creating products that have more value for consumers, promotion and setting competitive prices are some forms of marketing strategies that can help SMEs dominate the market.The business value of glass beads' craft industry got decreased in the last decade. Jombang beads began to lose market share in both local and global markets for various reasons due to high turnaround of younger generation from being beads' craftsmen and changed their profession into factory workers due to scarcity of raw materials. Many factories were switched from using non-glass packaging causing the raw materials used to make the beads hard to get.The flood of China's beads production played a big role in the decline of market share of beads' craft. Unlike China's beads products that are manufactured through industrial processes, the Jombang beads were manually appreciated as craft. So despite having the same quality, the Chinese beads were less compared to Jombang beads that are relatively more expensive.During these days, beads' craftsmen sell their products in conventional way. Marketing is done through distributors, who then distribute it to other regions such as Bali and Kalimantan. …