The Opportunities and Threats of Small and Medium Enterprises in Pekanbaru: Comparison between SMEs in Food and Restaurant Industries

Abstract

The development of Small and medium enterprises (SMEs) showed growing trend in Indonesia and also in Pekanbaru. Although small-scale enterprises, but it has very meaningful role to contribute to prop up the national economy and create many new jobs. The purpose of this study is to identify the effect of entrepreneurial competencies on business performance, and its opportunities and threats in the two types of small and medium enterprises that is, food and restaurants industries. Data was collected using a questionnaire. As many as 52 respondents from SMEs in food industries and 58 respondents SMEs in restaurants industries are participating in this study. Data is processed descriptively and quantitatively. The result of the study showed that both types of SMEs have high entrepreneurial competencies in their business. Based on quantitative analysis using regression, it was found that both entrepreneurial competencies have positive and significant effect on performance. Opportunities held by SMEs in Pekanbaru, among others, are economic growth above the national average, high level of public consumption, the conducive atmosphere to investment, geographically located close to the neighboring countries and so on. Nevertheless we can not deny the empowerment of the SME sector is still faced with the challenges, such as limited access to capital, raw material, information technology, qualified human resources, marketing the product or services, lacked of guidance from government, exchange rate, high interest rate, and so on. Therefore, increasing competitiveness of SMEs is urgently required especially in dealing with the ASEAN Economic Community in 2015.

Sustainability of SMEs in the Competition: A Systemic Review on Technological Challenges and SME Performance

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