THE INFLUENCE PF INNOVATION ON MSME BUSINESS PERFOMANCE WITH PRODUCT QUALITY AS A MEDIATING VARIABLE (A Study on Craft MSMEs in Purbalingga Regency)

Authors

Anggit Bawono Universitas Muhammadiyah Purworejo
Wijayanti Wijayanti Universitas Muhammadiyah Purworejo

DOI:

Keywords:

Inovasi, Kinerja Bisnis UMKM, Kualitas Produk

Abstract

Increasingly fierce business competition demands that business owners, including MSMEs, be able to enhance their competitiveness thru innovation development and product quality improvement. In other words, MSMEs must consistently generate new ideas focused on improving product quality to ensure sustainable business performance. The purpose of this study is to examine the influence of innovation on the business performance of MSMEs, to examine the influence of innovation on product quality, to examine the influence of product quality on the business performance of MSMEs, and to examine product quality in mediating the influence of innovation on the business performance of MSMEs. This study is quantitative research using the survey method. The data analysis tool used is SmartPLS with the SEM (Structural Equation Modeling) method. The results of the study show that innovation has a positive influence on the business performance of MSMEs, innovation has a positive influence on product quality, product quality has a positive influence on the business performance of MSMEs, and product quality mediates the influence of innovation on the business performance of MSMEs.

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