Key competitiveness of Indonesian small wooden furniture business

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Small wooden furniture businesses in East Indonesia feel pressure from the furniture businesses of the West Indonesia, in particular from Jepara, due to a fierce international rivalry. The study is intended to analyze the effect of market orientation and entrepreneurial orientation on competitiveness with innovation as an intervening variable. The study distributed 189 questionnaires to the small wooden furniture producers in the South and West Sulawesi Provinces. The collected data were analyzed by structural equation modeling using maximum likelihood approach. The study found that market orientation, entrepreneurial orientation, and innovation contributed to leveraging the competitiveness of small furniture producers. With this model, market orientation is found to have a positive and significant effect on innovation and competitiveness, both with a small-medium effect. Interestingly, the relationship between entrepreneurial orientation and innovativeness shows a positive, significant, and the most dominant of all structural causal relationships in the model, with a small-high effect. In contrast, the relationship between entrepreneurial orientation and competitiveness has a positive and significant effect with a smaller path coefficient. The study also found that innovation shows a positive and significant effect on competitiveness with a relatively small impact.

Acknowledgment
The case of small wooden furniture businesses of Indonesia is part of collaborative research between the research teams from Hasanudd in University and Universiti Kebangsaan Malaysia. In carrying out this study, the involvement of a number of agencies cannot be ignored: the Cooperative and Small and Medium Size Regional Office of South and West Sulawesi Province and Cooperatives and the Small and Medium Size Regional Office of Makassar City.

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    • Figure 1. Hypothetical model
    • Figure 2. Structural equation modeling of competitiveness for small wooden furniture businesses in Indonesia
    • Table 1. Measurable items
    • Table 2. Descriptive statistics
    • Table 3. Results of the measurement model
    • Table 4. SEM fit indices
    • Table 5. Hypotheses testing results
    • Conceptualization
      Jusni Jusni, Andi Aswan, Muhammad Hakimi Mohd Shafiai, Gunawan Baharuddin
    • Formal Analysis
      Jusni Jusni, Andi Aswan, Muhammad Hakimi Mohd Shafiai, Gunawan Baharuddin, Riandha Ridho Hafizh Thaha
    • Investigation
      Jusni Jusni, Andi Aswan, Muhammad Hakimi Mohd Shafiai
    • Methodology
      Jusni Jusni, Andi Aswan, Muhammad Hakimi Mohd Shafiai, Gunawan Baharuddin, Riandha Ridho Hafizh Thaha
    • Project administration
      Jusni Jusni, Muhammad Hakimi Mohd Shafiai
    • Supervision
      Jusni Jusni, Andi Aswan
    • Validation
      Jusni Jusni, Andi Aswan, Muhammad Hakimi Mohd Shafiai, Gunawan Baharuddin, Riandha Ridho Hafizh Thaha
    • Visualization
      Jusni Jusni, Andi Aswan, Gunawan Baharuddin, Riandha Ridho Hafizh Thaha
    • Writing – original draft
      Jusni Jusni, Andi Aswan, Muhammad Hakimi Mohd Shafiai, Gunawan Baharuddin
    • Data curation
      Andi Aswan, Gunawan Baharuddin, Riandha Ridho Hafizh Thaha
    • Writing – review & editing
      Andi Aswan, Muhammad Hakimi Mohd Shafiai, Gunawan Baharuddin, Riandha Ridho Hafizh Thaha