An Empirical Study of Furniture SMEs on Environment, Competitive Strategy, Manufacturing Strategy And Performance In East Java

Abstract

The problem faced by the Indonesian furniture industry in general at this time is tight competition as a result of Indonesia's participation in the free market. Furthermore, the global financial crisis has raised the price of products and services more difficult to be reached by the majority of society. While, the problems faced by SMEs Furniture in East Java Province is the absence of a competitive strategy to overcome the low product quality, high production costs, as well as orders delivery time which is often not on time. This paper discusses an empirical study to solve these problems. Based on the analysis of the research model with Partial Least Squares method, it was obtained the following results. First, the dynamics of the environment affects competitive strategy based on differentiation. Two, competitive strategy will affect the choice of manufacturing strategy. Unfortunately, manufacturing strategy does not affect the performance of SMEs. Meanwhile, the dynamics of the environment will have a direct impact on manufacturing strategy. Finally, competing strategies directly affect the performance of SMEs furniture

Keywords: furniture SMEs, competitive, manufacturing, performance, Partial Least Squares.