Spatial Dynamic Modeling for Increasing the Competitiveness of Small Medium Enterprises

Abstract

The Role of Small and Medium Enterprises (SMEs) in supporting Indonesian economic activity are significant. SMEs face many obstacles in their business development. Empowerment of SMEs in Bogor by local governments carried out in conjunction with the Department of Cooperatives and SMEs. This study establishes the spatial model design of SMEs in Bogor area to improve the competitiveness of products in Bogor city. The analysis shows that SMEs in Bogor city is still in the phase of development, market penetration, and also product development. The model shows the average performance index of SMEs in Bogor is only 62.29, 19 among 41 have index values about 50. From the competitiveness analysis, authors could see that among 41 SMEs can be categorized in 4 quadrants. Strategic program could be developed based on the position in the quadrant. It can be concluded that in general SMEs in Bogor city have not been ready for internationally competition. Government should develop specific strategy for each SMEs based on the quadrant position defined by the model