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Digital SME Confidence Index Report Q4 2020 by KoinWorks

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The Covid-19 pandemic that hit the world including Indonesia in 2020, had a major impact on economic activity.

In Indonesia, the Covid-19 pandemic not only has an impact on large business income but also has an impact on SMEs throughout Indonesia.

Lack of public purchasing power is the main cause of disruption to the production process which ultimately causes losses and leads to a reduction in the workforce during the pandemic.

Reporting from CEIC data, In the early Q1 or before the PSBB implementation period, the SME business experienced a decline and getting worst after the PSBB implementation period.

The business confidence index of SMEs at a rating of 2.37 / 5.00 shows that the outlook for the business during the Q1 – Q3 2020 period is quite negative.

This condition forces businesses to rack their brains to find innovations in various ways to survive and develop.

The digitization of SMEs is considered to be one of the right steps to overcome the constraints of limited business activities during a pandemic.


METHODOLOGY

We are conducting Mixed Methodology Research (MMR). 

This type of research combines insightful quantitative analysis using descriptive, cross-tabulation & correlation methods as deep as qualitative analysis using the word-association method. 

We obtained SME Owners views on how they are facing the business environment during the year of pandemic 2020, factors that affect their action, as well as their outlook on business after the pandemic.


EXECUTIVE SUMMARY

The results of research conducted on 1,188 business owners  consisting of various industrial sectors including :

Responden

of business owners agree that Covid-19 has harmed the business environment in Indonesia. 

The most needed factor for developing a business during a pandemic or after the pandemic ends is the financial aspect.


NICHE BUT NICE

The industry that made an addition to the type of products

Most businesses from various industries made additions to the types of products/services offered during the Covid-19 pandemic.

The industries that have the highest tendency are business in the health industry, medical equipment, construction, fashion, accessories, food and beverages, and professional services (digital marketing, photography, etc.).


2 SIDES OF KOIN

Based on qualitative analysis, respondents tend to innovate to gain business growth at the end of 2020 and early 2021.

The pandemic is forcing business people to think creatively and innovatively, and this has led to many home businesses popping up during the pandemic. 

As we know, most of them are online businesses.

Adding new products and services, also using various online channels like social media to maximize the promotion purposes.


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Gina Valerina
Beware of little expenses, a small leak will sink a great ship - Benjamin Franklin

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