Market Orientation and Innovation: The Impact of Entrepreneurial Orientation among Traditional Snack Entrepreneurs in Sanan, Malang, Indonesia

Abstract

The food and beverage industry has beome a mainstay sector in Indonesia and is projected to experience better growth in the coming year. However, the growth of this industry also causes a tight competition among similar businesses. In facing the competition, one key to succeed is innovation and entrepreneurial orientation. This research aims to determine the influence of market orientation on entrepreneurial orientation, the entrepreneurial orientation on innovation, and the market orientation on innovation in traditional snack SME entrepreneurs in Malang. This research is quantitative research, which is using an explanatory method. Data collection uses questionnaires that are distributed among 100 respondents of the SME entrepreneurs in Sangan, Malang. The sampling method is using purposive sampling to determine the amount of samples with certain considerations. The consideration is the length of operation for at least one year for the SME owners in Sanan, Malang. The data analysis method is using Partial Least Square (PLS). This research shows that market orientation has a positive significant influence on entrepreneurial orientation, and entrepreneurial orientation also has a significant influence on innovation. Finally, market orientation has a significant and positive influence on innovation among traditional snack SME entrepreneurs in Sanan, Malang.