Trikonomika Volume 17, No. 2, December 2018, Page. 101-108 ISSN 1411-514X (print) / ISSN 2355-7737 (online) DEVELOPMENT STRATEGIES OF MICRO BUSINESS IN MAJALENGKA REGENCY Ellen Rusliati [email protected] Mulyaningrum Mujibah A. Sufyani Fakultas Ekonomi dan Bisnis Universitas Pasundan Jl. Tamansari No. 6-8, Bandung Wetan 40116 received: 24/5/18; revised: 20/7/18; published: 31/12/18 Abstract The purpose of this study was to determine the development strategies of micro business potential to utilize aerocity opportunities in Majalengka Regency. The local potential in Majalengka were agriculture and natural resource-based tourism. Processing of local raw materials into products that fit the needs of the community would be able to increase the income of the population. The research method used was descriptive qualitative. The results showed the right strategy was market penetration and new product development. Efforts to be taken to support the strategy included (1) Improving the quality of human resources in services and trade, (2) Innovation of new local based products, (3) Promotion of information technology utilization, (4) Increasing tourism infrastructure involving micro businessmen, (5) Business assistance, market survey, and management training involve Higher Education, (6) BUM Desa facilitations in machinery, storage, capital development, product marketing, (8) Producing products according to agricultural commodities. Keywords: micro business; potencies; opportunities; Majalengka Regency INTRODUCTION will not decrease from 41%. Therefore, it is necessary to develop entrepreneurship in rural areas. Minister of Cooperatives and Small Medium Majalengka is a regency in West Java whose Enterprises (SME), said that the number of entrepreneurs geographical conditions are divided into 3 zones: (1) in Indonesia is about 1.65% of the population. Singapore 40.03% mountains, (2) 31.27% corrugated/hilly, and (3) 7%, Malaysia 5% and Thailand 4% (Republika, 28.70% lowlands of the total regency area. It also consists 12/3/2015). If the number of entrepreneurs increases, of 26 sub-districts and 330 villages. This condition allows it will also boost the economy of the country, with the potential growth of local specific natural resources. increasing employment, which will ultimately be able As a lowland area supported by its strategic position, to improve the quality of community welfare. SMEs’ Majalengka Regency is very suitable to be developed into are becoming increasingly important for the creation a business and industrial city, therefore the Government of and development of a modern, dynamic and knowledge- West Java Province establishes Majalengka as a priority in based economy, because of their ability to be flexible infrastructure development that is Kertajati International and adapt quickly to a changing market, and to generate Airport (Kab. Majalengka, 2018). With the concept of new jobs (Govori, 2013). developing Kertajati as Aerocity, it will make Majalengka Developed countries have created their industrial power as a center for various supporting industries, as well as on the basis of SMEs, and this sector offers transitional a center of economic growth in the eastern region of countries the opportunity for the fastest implementation West Java Province. of modern solutions and practices (Džafić et al., 2011). In detail, the potential of Majalengka Regency has A strong SME sector contributes highly to the economy, been determined by Peraturan Daerah No. 11 of 2011 contributing to the gross domestic product, by reducing on Spatial Planning in 2011 - 2031 as: (a) Cultivation the level of unemployment, redusing in poverty levels areas consisting of production forests, agriculture, and promotions of entrepreneurship activity (Sitharam fisheries, mining, industry, tourism, settlements and and Hoque, 2016). If the efforts only focus on the cities, other designations, (b) Center of urban and rural it will increase people’s welfare, but uneven and gini ratio activities, (c) Strategic area of West Java and Regency. 102 Trikonomika Ellen, et, al., Vol. 17, No. 2, December 2018 Majalengka Regency will become a very strategic The low capability to diversify and differentiate area for new economic growth for the eastern region local processed products according to market demand of of West Java Province before the opening of Kertajati the community in Majalengka Regency is caused by the International Airport. Therefore, the people should lack of information about the development of needs of prepare to deal with competitive market development the current consumers, so the local farmers’ products do situations, changes in livelihoods and culture. This should not have the ability to compete. As a result, marketing be prepared for them to anticipate for modernization. activities become ineffective. Besides, it also requires Micro businessmen need to be invited to innovate and a synergy between people in various matters related pay attention to market demands, so that agricultural to product marketing management to increase sales. products can be absorbed by the market and provide This research is expected to produce a micro business added value. development strategy, so that the potential development Most of Majalengka Regency’s people are of local agricultural products can be utilized more farmers, so rural development remains a priority, optimal, and well sold and effective in producing and including human resources and agribusiness-based marketing generate profits. economic development and agricultural technology Specific objectives of the study consist of: (a) implementation in order to increase production and Identifying potential local agricultural products using productivity as an effort to strengthen food security Strengths, Weaknesses, Opportunities, Threats (SWOT) and fulfillment of industrial raw materials. analysis to identify local potentials that can be developed The result of the preliminary observation revealed to meet market needs, obtaining available opportunities, that the people of Majalengka Regency generally use and building competitiveness and penetrating internal agricultural products only for their own consumption constraints and competition, (b) Analyzing functional and the rest are sold directly to the market. There is management that includes production management, no crop processing process from local agricultural product marketing management, financial system, and products, so the price falls on harvest time. As a result, human resource management. even though farmers live well, they are not really From the background of the problem, we obtained better than before. From the preliminary data, it is information on the condition of the society and micro found that the public interest for entrepreneurship entrepreneurs in Majalengka Regency generally have is quite high, but it has not been supported by the the following characteristics: (1) Lack in product application of appropriate technology and adequate diversification and differentiation in accordance with management system, therefore the potential has not market demand, (2) Lack in the possession of concept added significant value. Some communities have of integrated production strategy and tactics and market already processed their crops manually and very in order to have an advantage to compete, (3) Having a simply. As a result, the processed products of these strong entrepreneurial spirit, but less developed optimally. agricultural products do not last long, and do not To be a successful entrepreneur must be innovative – have high selling value. Their products are only applying advance technique to production and marketing. sold in the local market, so the profit is not optimal. There is a strong connection between technological Eventually their entrepreneurial spirit is channeled development and entrepreneurship. Technology makes to sell foreign products. Some people who have the entrepreneurship dynamic, it encourages diversifications potential to develop entrepreneurship even move to and economies of scale (Okorie et al., 2014). other cities, so the local potential left dormant and The process of formulating alternative strategies managed perfunctory. of Majalengka Regency development is done through Micro Enterprise is a productive business owned a series of analysis that cover several stages beginning by individual and/or individual business entity with with descriptive analysis by identifying vision, mission asset criteria of ≤ 50 million rupiahs and turnover and objectives. This identification is important to know of ≤ 300 million rupiahs, based on Law no. 20 year further about the targets to be achieved. Internal analysis 2008 on Micro, Small, Medium Enterprise (www. is done in the fields of management, marketing, finance, bi.go.id). Micro enterprises are often confronted to production/operation, human resources, and behavior functional management constraints. Cooperation change, while external analysis is done by considering between suppliers, entrepreneurs, and output markets Political, Economic, Socio-Cultural Demography, is needed to ensure the availability of raw materials and Technology factor. markets. The ability of micro enterprises to produce local The identification results will further be incorporated processed agricultural products that vary according to into the framework of strategy formulation consisting of market demand will demand diversification and product (David and David, 2016 translated by Novita and Liza): differentiation.