MSMEs and Strategies for Increasing the Business Potential of MSME Business Actors in Indonesia

 

Talking about business, then we are talking about how a business can be run continuously so as to generate a profit. This thinking concept should indeed be something that MSME business people in Indonesia should think about. Because talking about MSMEs, currently one of the keys in business development in Indonesia is the active role of MSMEs.

 

 

MSMEs can indeed be said to be one of the business actors that can be relied upon by the Government and the business world. Where in its role of supporting and supporting the economic conditions that exist in Indonesia, it can be clearly said that MSMEs are one of the business actors who are able to contribute directly to the development of the Indonesian economy in various conditions.

For example, when Indonesia was experiencing a Covid pandemic, we could say that MSMEs are business people who can ultimately drive the development of economic growth in Indonesia. It is not surprising that in the end, currently in conditions that are getting better, the role of MSMEs is increasingly expected to be able to contribute more to economic development in Indonesia.

5 Things That Are Obstacles in MSME Business Development in Indonesia

Even though it looks important for economic development in Indonesia, we can directly say that there are several problems that until now have become problems or obstacles that are often faced by MSME business people in Indonesia. Where for clarity we can say there are at least 3 problems that become obstacles or obstacles for MSMEs to be able to develop in Indonesia.

 

1. One of the obstacles or problems that are often faced by MSME business people is the lack of capital for MSME business development.

Capital is indeed still an obstacle in the development of MSME businesses in Indonesia, where in such conditions it is only natural that in the end MSMEs are unable to develop according to what they desire. Where to develop they are still faced with one obstacle called capital. That is why, in the end, not many MSMEs can develop with the limited capital they have.

2. Another problem that is currently also an obstacle for the development of MSMEs in Indonesia is a problem related to the business development of MSMEs.

Where this condition can be said to be quite a problem because usually an MSME business actor will run his business according to what he believes. They don't do much product innovation because they are not able to develop their products well enough.

3. MSME business actors are less able to carry out Product Innovation properly

The concept of product innovation in question is innovation that can provide selling value or added value for the product it owns. So that we all know that the products owned by MSMEs are still limited to products that are ordinary in nature, not like special products like modern products.

4. Usually, MSMEs are not very familiar with digital marketing.

With a lack of understanding and knowledge regarding digital marketing, it's only natural that in the end they are only able to carry out traditional promotion and marketing.

5. Not being able to understand and implement the use of a good accounting system is one of the shortcomings of MSME business people.

Naturally, if in the end the business development in MSMEs is less able to develop into a bigger one, because accounting issues as the main basis of the company are said to be professional, not many MSME business people understand.

 

The Current Condition of MSMEs and Their Future Perspectives in Business in Indonesia

If we try to look back, where do we know that economic conditions resulted in a significant decline in economic growth in Indonesia. So we can say that in 2020 – 2021 based on a survey that has been carried out by international institutions such as UNDP and the LPEM UI institution by trying to involve 1,180 respondents from MSMEs. Where from these results can be explained several things as follows:

 

1. As many as 48% of the total respondents said that in 2020-2021 the condition of MSMEs is experiencing problems with a shortage of raw materials to produce their products. That is clearly the basis for why MSMEs are slow in developing their business.

2. As many as 77% of the total respondents from MSMEs said that their income had decreased significantly.

3. As many as 88% of the total respondents said that they experienced problems related to the decrease in product demand.

4. As many as 97% of the total respondents who came from MSMEs experienced problems with decreasing the value of their assets.

Based on these conditions, the government in order to support and support the development of MSMEs in Indonesia, especially from the negative impacts that have occurred due to the covid pandemic, then there are several policies that will be implemented by the government to support the development of MSMEs, namely: (1) National Economic Recovery Program ( PEN) where several programs are aimed at increasing movement and economic growth nationally (2) Trying to implement regulations with the Job Creation Law with several derivative regulations (3) Proud Made in Indonesia Program (BBI)

Those are some things that can be done by the government and the business world in order to encourage and support business development in the MSME business sector in Indonesia. Where for this purpose such as the PEN program for example. So there are several excellent programs run by the government, such as:

1. For capital, this is by providing assistance through the field of KUR financing which was carried out during the Covid pandemic last year.

2. Productive Assistance Program for Micro Enterprises for MSME business actors in Indonesia

3. Programs that support the capital sector, such as non-KUR interest/margin subsidies.

4. Another program that is carried out is by placing funds/placement of state money to programs related to MSME Credit guarantees.

5. The investment financing program for cooperatives is carried out through LPDB KUMKM.

6. Programs related to MSME Financial Income Tax (PPh) which are borne by the Government.

7. As well as the Cash Assistance Program for Street Vendors, Stalls and Fishermen (BTPKLWN).

 8. MSMEs and Strategies for Increasing the Business P