Empirical Analysis of the Inhibiting Factors of Micro-Business Growth in Jakarta, Indonesia

Abstract

The purpose of this study is to investigate which inhibiting factors that can cause the micro-businesses in Jakarta to have stagnant or declining growth. A survey method was distributed to collect 150 micro-business owners located in five Jakarta administrative cities, whereas only 98 data passed the requirements to be processed and analyzed further. Based on the literature, there are four inhibiting factors suspected that able to make the growth of micro-business stagnant or declining: lack of entrepreneurial mindset, lack of financial, lack of business management experience, and lack of government support. Various statistical analyses were executed to identify the factors limiting the growth of micro-businesses in Jakarta. The findings of this study discovered a factor that limiting the growth of micro business in Jakarta the most is lack of business management experience. The government should provide an educational institution specifically for micro-business owners so that they can have improved experience on business management such as in financial management and planning, basics of the marketing concept, and bookkeeping or accounting. The samples and findings are not a depiction of the entire micro-business sectors (street vendors) in Jakarta, so the findings cannot be generalized to the street vendors that were not part of this study. The replication using larger samples in the future also recommended for cross-validation purposes.