Analysis of Determinants of Digital Adoption of Small and Medium Micro Enterprises in Surakarta City

Abstract

The city of Surakarta has grown to become the center of the digital ecosystem in Indonesia. The government has made various efforts to increase collaboration and creativity between various sectors. However, based on the level of digital adoption of micro, small and medium enterprises in the city of Surakarta, it is still low, so policy innovation is needed to increase digital adoption for business actors. This research aims to analyze the influence of business actor characteristics and business characteristics on the level of digital adoption of micro, small and medium enterprises in the city of Surakarta. This research uses cross-sectional secondary data with secondary data sources obtained through the Surakarta City Cooperatives, SMEs and Industry Department. The sampling technique uses purposive sampling. Data analysis methods use univariate, bivariate and multivariate analysis. The research results obtained 2,425 samples, of which 1,821 business units (75.09%) had utilized digital adoption and 604 business units (24.91%) had not yet utilized digital adoption. Business experience, type of business and business capital have a positive and significant effect on the level of digital adoption of micro, small and medium enterprises in the city of Surakarta. Based on the results of this study, the researcher provides recommendations for the Surakarta City government to utilize the role of digital adoption in formulating policies for the empowerment and development of micro, small and medium enterprises in the City of Surakarta because micro, small and medium Enterprises play an important role in economic growth in the City of Surakarta.