2017, Dili, Timor Leste - ICOEN 5 Official Website

The Fourth International Conference on Entrepreneurship | Book One

FOREWORD Welcome to the 4th International Conference on Entrepreneurship (ICOEN) 2017, Dili, Timor Leste On behalf of The Organizational Committee, Honorable Chairs, Conference Chairs , and Conference Co-Chairs, its is a great pleasure to welcome you to this 4th ICOEN Annual Conference 2017 in Dili, Timor Leste.

A special word of appreciation to our Conference Chair , Miguel Lucas Lay Costa, SE., M.M.; Manuel Gonvalves Lic. Eco, M.M, Fransisco Vicente Lic Eco, M.A; Manuel Loe Siga Lic Eco, M.M; Faustina da Costa Lic, CSH for their enormous efforts and good collaboration toward the arrangement for hosting this annual ICOEN conference.

The ICOEN 2017 activity will enhance good relationship between academic scholars and business practitioner in Organization. We do hope you have enjoyable and enriching experience throughout the conference , and take adventage of the collaborative, friendly and community of advanced scholarship from our international conference. May I also take this opportunity to invite you to the 5th ICOEN 2018 to be held in Universitas of Ciputra , Surabaya, East Java, Indonesia. Last but not least, we would like to express our sincere gratitude to everyone who has contributed and made the joint conference a success.

Best wishes, ICOEN 2017, Steering Committee Chair Dr. J.E.Sutanto, M.M. Graduate School, Universitas of Ciputra Surabaya, INDONESIA

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The Fourth International Conference on Entrepreneurship | Book One

FOREWORD It is my great pleasure to welcome you all in the 4th International Conference on Entrepreneurship (ICOEN) 2017 I would like to delivery my sincre thanks to the working. Team Universitas of Ciputra, Surabaya Indonesia, for their Enormous contribution towards the detailes arrangement of the 4th International Conference on Entrepreneurship (ICOEN) 2017, Dili, Timor Leste). The conference is held on September 06th and 08th, 2017, moreover. It attracts educators, researchers, and entrepreneurs which related with scientific disciplines of practitioners. On this occasion, let me give special thanks to the Keynote Speakers: (1) Dr. Charles Chow East-West Management University, Singapore; (2) David S. Dixon University of New Mexico, USA, (3) Dr. Amir Shaharuddin, Universiti Sains Malaysia, Malaysia, (4) Prof. Dr. Lucas da Costa, S.E., M.Si., Universidade da Paz, Timor Leste, (5) Dr. Ir. Denny Bernadus, M.M.,Ciputra Education Foundation, Indonesia, (6) Dato Dr. Kim Tan Advisor, TBN Asia; TRUSTEE, TBN UK I also want to thank the kind support all of co-host which your contribution to this seminar as reviewers and keynote speakers make this event more meaningful and evaluable. We are also thankful to all reviewers, for their commitment, effort and dedication in understanding the task of reviewing all of the full paper. We would like to thank to all authors who have submitted their papers to be reviewed, those whose paper were chosen to be presented in the seminar, and those who have submitted manuscripts to be publishes in proceeding. On behalf of all my colleagues, I would like to offer my best wishes for a successful, stimulating and memorable conference

Sincerely, ICOEN 2017, Conference Chair Miguel Lucas Lay Costa, SE., M.M Universidada da Paz, Dili, Timor Leste

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The Fourth International Conference on Entrepreneurship | Book One

COMMITTEE Steering Committee 1. Dr. J.E.Sutanto, M.M. Universitas of Ciputra Surabaya 2. Dr. Ir. Dominggos Cairesi B.B. Gomes, M.Sc. Universidade da Paz, Dili, Timor Leste 3. Ir. Rini Retnowati, M.PA Universidade da Paz, Dili, Timor Leste 4. Fernando Diaz Gusmao, Amd., S.IP., MAP., Universidade da Paz, Dili, Timor Leste 5. Rosinho da Crusz, Lic.Dir., M.Dir., Universidade da Paz, Dili, Timor Leste 6. Dr. Wirawan Endro Dwi Radianto, S.E., M.Sc., Ak Universitas of Ciputra Surabaya 7. Dr. Trianggono Wiradinata, S.T., M.Eng., Sc. Universitas of Ciputra Surabaya 8. Damelina B. Tambunan, SE., M.M., Ph.D. Universitas of Ciputra Surabaya 9. Dr. David Sukardi Kodrat, M.M. Universitas of Ciputra Surabaya 10. Dr. Tina Melinda, M.M. Universitas of Ciputra Surabaya 11. Imam Wijoyo, S.E., M.M. STIE IBMT Surabaya

12. Prof. Dr. Nyoman Puspa Asri, M.S. University of W.R. Supratman Surabaya 13. Irwan Yulianto, S.H., M.H.

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The Fourth International Conference on Entrepreneurship | Book One

University of Abdurachman Saleh Situbondo 14. Dr. H. Pribanus Wantara, Drs., M.M. University of Trunojoyo Madura 15. Dr. Ir. H. Sundjoto, M.M. STIE Mahardhika Surabaya 16. Dendi Sean T. Indonesia Marketing Association Chapter Surabaya 17. Dr. Muhammad Alkirom Wildan, S.E., M.Si. Insan Doktor Ekonomi Indonesia Surabaya

18. Drs. Eko Wahjudi, M.Si. University of State Surabaya 19. Gabriel Neves Institute of Business, Timor Leste 20. Lucio M. Gomes East Timor Coffee Institute

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The Fourth International Conference on Entrepreneurship | Book One

Organizing Committee Chair

: Miguel Lucas Lay Costa, SE., M.M.

Universidade da Paz

Secretary

: Manuel Gonvalves Lic. Eco, M.M..

Universidade da Paz

Co-Secretary

: Fransisco Vicente Lic Eco, M.A.

Universidade da Paz

Treasury

: Manuel Loe Siga Lic Eco, M.M.

Universidade da Paz

Co-Treasury

: Faustina da Costa Lic, CSH

Universidade da Paz

HELD BY UNIVERSIDADE OF dA PAZ DILI COLLABORATED WITH 1.

University of Ciputra Surabaya, INDONESIA

2.

University of Trunojoyo Madura, INDONESIA

3.

STIE Mahardhika Surabaya, INDONESIA

4.

University of W.R. Supratman Surabaya, INDONESIA

5.

STIE IBMT Surabaya, INDONESIA

6.

University of Abdurachman Saleh Situbondo, INDONESIA

7.

University of State Surabaya, INDONESIA

8.

Insan Doktor Indonesia Surabaya, INDONESIA

9.

Indonesia Marketing Association of Chapter Surabaya, INDONESIA

10.

Institute of Business, TIMOR LESTE

11.

East Timor Coffee Institute, TIMOR LESTE

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The Fourth International Conference on Entrepreneurship | Book One

REVIEWER 1. Prof. Drs. Tatang Ary Gumanti, M.Buss. Acc., Ph.D University of Jember. 2. Prof. Dr. Ir. Hening Widi Oetomo, M.M., Ph.D. Sekolah Tinggi Ilmu Ekonomi Indonesia Surabaya 3. Prof. Dr. Lucas da Costa, SE., M.Si Da Paz Universidade, Timor Leste 4. Dr. Tina Melinda, Dra., M.M. Universitas of Ciputra Surabaya 5. Prof. Dr. F. Danardana Murwani, M.M University of State Malang 6. Dr. Christina Whidya Utami, M.M. University of Ciputra Surabaya 7. Dr. David Sukardi Kodrat, M.M. University of Ciputra Surabaya 8. Dr.Tommy Christian Efrata, S.E., M.Sc. University of Ciputra Surabaya 9. Dr. J.E. Sutanto, M.M. University of Ciputra Surabaya 10. Prof. Dr. J.G. Nirbito, M.Pd University of Ciputra Surabaya 11. Jose Cornelio Guterres, Ph.D

Universidade da Paz, Dili, Timor Leste

12. Dr. Elidio de Araujo, Lic.Eco, M.M Universidade da Paz, Dili, Timor Leste

13. Dr. Augusto C Soares, S.E., M.M Institute of Business, Timor Leste 14. Dr. Adolmando Soares Amaral, Lic.Eco, M.M Universidade da Paz, Dili, Timor Leste

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The Fourth International Conference on Entrepreneurship | Book One

15. Dr. Alex Pires, Lic.Eco, M.M Universidade da Paz, Dili, Timor Leste

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The Fourth International Conference on Entrepreneurship | Book One

KEYNOTE SPEAKERS 1. Dr. Charles Chow East-West Management University, Singapore 2. David S. Dixon University of New Mexico, USA 3. Dr. Amir Shaharuddin Universiti Sains Malaysia, Malaysia 4. Prof. Dr. Lucas da Costa, S.E., M.Si. Universidade da Paz, Timor Leste 5. Dr. Ir Denny Bernadus, M.M. Ciputra Education Foundation, Indonesia 6. Dato Dr. Kim Tan Advisor, TBN Asia; TRUSTEE, TBN UK

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The Fourth International Conference on Entrepreneurship | Book One

TABLE OF CONTENTS Novendy Yoyada1, David Sukardi Kodrat2 Insaniyatus Sakinah1, J.E.Sutanto2 Ryan Pramuditya1, Christina Whidya Utami2 Patrick Goenawan T1, Trainggoro Wiradinata2 Winarto Poernomo1, Denny Bernardus2 Edwin Yohanes Gunadisastra1, J. E. Sutanto2 Juneita Titing Senewe1 , David Sukardi Kodrat2 Amelia Alim1, Tina Melinda2 Heryanto Prayogo1 , Tina Melinda2 Laili Affidah1, J.E. Sutanto2 Sheila Vania Winata1, Tina Melinda2 Junko Alessandro Effendy1, Thomas Stefanus Kaihatu2 Putro Bagus Sulistyo1, David Sukardi Kodrat2 Allen Dharmawan Wicaksono1, Danardana Murwani2

Effect of Marketing Mix (7P) on Decision of Consumer Selection in Ny Dental Clinic of Surabaya City Feasibility Study Business Development Kedai Ketan "N" in Sidoarjo Designing Blue Ocean Strategy Model at PT. Natural Source Indolestari

1

9 19

Succession Planning in a Family Business (CV. Manikam Jaya Plastik)

29

The Impact of Service Quality and Positive News of Mass Media Towards Student Satisfaction in University of Ciputra Innovation Strategy Implementation in Steel Manufacturing Company

36

The Delays Factors of Housing Projects From the Licensing Management Aspects Point of View Influencing Factors in Choosing A Preschool: A Case Study in Ivy Preschool Surabaya Developing Strategy of Product, Price, Promotion and Location to Gain Revenue of Kapin Restaurant Using SWOT Analysis The Role of SWOT in Business Development of Mahreen Collection

58

Innovation for Hype Leather

94

44

68 75

83

Factors That Encourage Decision to Become A Hybrid Entrepreneur

102

The Analysis of Business Development Strategies in Esa Farma Pharmacy The Effect of Self-Efficacy and Student Motivation Toward the Student Academic Achievement in Humanities Class at Ciputra Junior High School Surabaya

111

Andrew Limandow1, Perception of Potential Patients and Doctors Thomas Stefanus Kaihatu2 Againts Doctors Based Online Consulting Services Antoni Widiya1, David Business Development Feasibility Study af

128

120

137

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The Fourth International Conference on Entrepreneurship | Book One

Sukardi Kodrat2 Christian Boby Widjaja1, Wirawan E.D. Radianto2 Eko Purwanto1, David Sukardi Kodrat2 Elia Rapha Tister Nursalim1, Denny Benardus2

146

152 160

Puput Tri Kusminto1, J E Sutanto

Business Development of Communication Education Institution of Surabaya, East Java

168

Tjoeng Lenni Indriani1, Tina Melinda2 Dian Juliantine1, Tina Melinda2 Henry Samuel Tanuwijaya¹, Tina Melinda2 Puspita. D1, Thomas Stefanus Kaihatu2

Analysis of Price Determining Strategy at Prima Skin Clinic Semarang Evaluation of Customer Satisfaction Towards Amylinear Product Online Marketing Strategy of Hot Wheels Product Using Marketing Mix

174

197

Farida Anwari1, Hermeindito2

The Effect of Service Quality and Price Toward Customers’ Satisfaction at Toko Raja Pulsa – Ternate The Benefits of Using Sugarcane Loader for The Cutting-Loading-Transporting Management at Sugar Cane Factory Djatiroto, Lumajang Positioning Strategy of Service Product at "Xyz" Company in East Java Marketing Mix Analysis on Decision Making to Study in The Continuing Higher Education (Studies in Stikes Anwar Medika Hospital Sidoarjo)

Alvand Gosal1, Denny Bernardus2

Business to Business Marketing Strategies For Fresh Orange Juice Xyz Products

231

Yenny Rahayu 1, Tina Melinda 2

The Factor Analysis on Purchasing Decision Making in Stores X

239

Kuswana Rama Destian1, David Sukardi Kodrat2

Impact Evaluation of Swm/Sps Dealership System By PT SIS to Pt RMBA

248

Shinta Nastiti1, Hermeindito2

Leadership Role and Organizational Culture in the Succession Planning of PT DABN

256

Febrian Bagus Pakerti1, David Sukardi Kodrat2 Amelia Tedjabhawa1, David Sukardi Kodrat2

X

Architect Consultant A Decision of PT. S to Continue or Discontinue a Segment of Certain Products Using Relevant Cost Analysis Marketing Strategy for Scale up Beauty Clinics "nfd" Analysis of Marketing Mix About People’s Buying Decision of Walking Revival Products

182 188

203

210 219

The Fourth International Conference on Entrepreneurship | Book One

Alfy Wahyu Pramita Sari ¹, Tina Melinda² Amanda Syafrida Paramita1, Christina Whidya Utami2

The Analysis of Brand Building Factor of Tea Product in Surabaya Analysis The Influence of Trust on Succession Planning (Study at Sonokembang Group)

263

Anindita Laksmi1, J.E. Sutanto2

The Effects of Training, Recruitment And Leadership on Commitment to Service Quality Employees (Study Case: Sonokembang Catering) Analyze The Effects of Service Quality, Price, and Product Quality Trend Tracer on Consumer Purchase Satisfaction

280

Grace Latumahina1 Dr. Christina Whidya Utami, M.M2

270

285

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The Fourth International Conference on Entrepreneurship | Book One

EFFECT OF MARKETING MIX (7P) ON DECISION OF CONSUMER SELECTION IN NY DENTAL CLINIC OF SURABAYA CITY 1

Novendy Yoyada, 2David Sukardi Kodrat♠ Ciputra University Surabaya INDONESIA Email: [email protected]

ABSTRACT This study aims to analyze the influence of product, price, place, promotion, people,physical evidence,process to the purchase decision. This study used seven independent variables are product, price, place, promotion, people, physical evidence, process with one dependent variable, namely the purchase decision. In connection with the purchase decision, in this study focuses on factors that could cause consumers to make purchase decisions, namely poduct factor, price, place, promotion, people, physical evidence, process. The data in this study were collected through questionnaires and implemented to 92 consumen of NY Dental Clinic as the study sample. Data analysis methods used are quantitative analyzes, the test reliability and validity, the classical assumption test, t test and F test, coefficient of determination as well as multiple linear regression analysis. Based on the results of data analysis, showed that: product variables have significant and positive influence on purchase decisions, price variables have positive and significant impact as well as having the greatest influence on purchase decisions, place the variable has a negative and significant influence on purchase decisions, promotion variables have a positive influence and significant impact on purchasing decisions,people variables have a negative influence and significant impact on purchasing decisions, physical evidence variables have a positive influence and significant impact on purchasing decisions, process variables have a positive influence and significant impact on purchasing decisions Keywords : Product, Price, Place, Promotion, People, Physical Evidence, Process marketing mix, purchasing decisions

INTRODUCTION Dental and oral health is the initial gateway of body health. However, we often underestimate this problem. And as we know, the teeth and mouth is the gate entrance of germs and bacteria that can interfere with the health of other organs. The problem of cavities is still widely complained by both children and adults and can not be left to severe because it will affect the quality of life where they will experience pain, discomfort, disability, acute and chronic infections, eating and sleeping disorders and have a high risk to be treated In hospitals, leading to high medical expenses and reduced schooling time. This shows the low dental health of the Indonesian population and the lack of public knowledge of oral health that will affect the quality of life of the community, therefore, to improve dental and oral health and general health of the Indonesian population, the community will be more

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The Fourth International Conference on Entrepreneurship | Book One

aware and energized To maintain health if there are many health facilities to support them. Health facilities include hospitals, health centers, health clinics, as well as private practice. One of the clinical concepts under development is dental clinics that provide dentists according to their respective specialists. Every patient who comes will get treatment by a dentist who is specialist in his field. For example, patients requiring the manufacture of dentures will be treated by a specialist dentist prosthodontics (denture specialist), patients requiring braces will be treated by an orthodontic dentist specialist (dental specialist), patients requiring gum care and a dental support network Treated by a dentist specialist periodonsia. This is very good because complaints will be resolved in accordance with the duties and competencies of each dentist, as well as avoiding malpractice. The city of Surabaya as the second largest city in Indonesia has a population of about 2.7 million people, has only about 2,000 dentists. This number continues to increase along with the many new dentistry graduates. Marketing Mix made by dental clinic can influence consumer decisions in performing dental care in a dental clinic. Kotmark's marketing concept according to Kotler is a combination of controlled marketing variables, which are used by a company to achieve a certain level of sales on a target market. Marketing Mix (7P) consists of Product-Price-Place-Promotion-PeoplePhysical Evidence-Process. The seven elements of 7P are the main elements that must be really considered to achieve marketing objectives Three success criteria that can be used as a benchmark for the achievement of goals are able to survive (survival), growth (growth), and generate profit (profitability). Survival is the ability of organizations to find alternatives to pioneer the form of professional health services. Growth is the ability of the organization to develop its business to survive in the competition and improve the quality of service, while profitability is the ability of business organizations to support the improvement of welfare. Achieving these three goals, is a long-term plan that can be achieved within a certain time. Successive goals to be achieved are survival, growth, and profitability Dental Clinic has a new concept compared to conventional dentist practice. Dental clinic requires the right marketing strategy for consumers willing to visit and do maintenance. Kotler says that today's service providers realize that it is unlikely to attract all consumers in the market or at least all buyers in the same way. By knowing the marketing elements that really affect the consumer's decision, the clinic owner can determine the right steps to improve the profitability of his clinic business and survive the increasingly tight competition in the city of Surabaya. LITERATURE REVIEW Marketing mix (Marketing mix) has an important role in influencing consumers in order to buy a product or service offered by the company. The elements of the marketing mix consist of all the variables that a company can control to satisfy consumers. Understanding the marketing mix according to Buchari Alma (2011: 130) "Marketing mix is a strategy of mixing activities marketing, to look for the maximum combination to bring the most satisfying result ".According to Zeithaml and Bitner (2013: 48)"The marketing mix is the organizational elements of a company which can be controlled by the company in communication with guests and to satisfy guests ". Meanwhile, according to Kotler and Armstrong (2012: 92) "Marketing mix is good marketing tool is a set of products, pricing, Promotion, distribution, combined to produce the desired response of the Target market ". All three definitions can be concluded that the marketing mix is a good marketing tool that resides within a company, where the company is able to control it in order to influence the target market response. A set of marketing tools contained in the marketing mix is known in terms of 4P, product, price, place or promotion, and promotion (marketing) has several additional marketing tools such as people ( People), physical evidence (physical facilities), and process (process), so known by the

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The Fourth International Conference on Entrepreneurship | Book One

term 7P, it can be concluded marketing service mix of product, price, place, promotion, people, physical evidence, and process. The understanding of 7P by Kotler and Armstrong (2012: 62) 1. Products The product is something that can be offered to the market to get attention, purchase, use, or consumption that can meet the wants or needs, whereas according to Private (1984) the product is a complex nature, both palpable and intangible, including wrap, , Prestige prices of retail companies, corporate services and retailers received by buyers to satisfy their wants and needs (Suliyanto, 2010). The product level is divided into five, namely: (1) Core benefit product, (2) Generic / Basic product, (3) Expected product, (4) Augmented product, and (5) Potential product. Products offered to the market can be in the form of goods and services. Based on the purpose of its use, goods can be grouped into two, namely consumer goods and industrial goods. Consumer goods are goods purchased for the purpose of consuming directly, while industrial goods are goods purchased for the purpose of processing again for industrial purposes (Suliyanto, 2010: 83). 2. Price / Price Price is the amount of money or goods needed to get a combination of other items accompanied by the provision of services. Determining the price level is crucial to the success of a business. Therefore, an in-depth analysis of the factors that determine the price level is needed to determine the price. In general, companies set the price level using several pricing approaches (Suliyanto, 2010: 87). 3. Place / Place or Distribution Distribution is all the activities undertaken by the company with the aim of making the product needed and desired by the consumer can be young obtained at the right time and place, while the distribution channel is a channel used to channel goods from the producers to the hands of the end consumer. Determination of location and channel used to deliver product to consumer's hands included in distribution scope (Suliyanto, 2010: 91). Location planning is one of the first steps to be taken before the company starts operating. The purpose of location planning is to determine the location of a company or place of business as best as possible in order to operate or run the process of production / service smoothly, low operating costs, the ability to compete companies and enable future expansion, even in this era of globalization, Location planning can make a complex problem. Various location alternatives that must be considered by looking at the borders of the State, because the planning of the location of a business / company in this globalization era began to penetrate cross border Country (Sunyoto, 2014: 241-242) 4. Promotion The definition of promotion by Stanton (2004) is a combination of advertising, personal seling, and other promotional tools designed to achieve sales program objectives, while Kotler (2012) defines promotion as all activities the company undertakes to communicate and promote products to target markets (Suliyanto , 2010: 94). 5. People People are all actors who play an important role in the presentation of services so that it can affect buyer's perception. Elements of people are employees of companies, consumers, and other consumers. All employee attitudes and actions, how to dress employees and the appearance of employees have an influence on the success of service delivery. (Lupiyoadi and Hamdani, 2008). 6. Physical Evidence is a real thing that also influences consumer decisions to buy and use products or services offered. Elements included in physical facilities include environmental or physical buildings, equipment, supplies, logos, colors and other items. (Lupiyoadi and Hamdani, 2008)

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7. Process Process is all the actual procedures, mechanisms, and flow of activities used to deliver services. This element of the process means something to deliver services. Process in services is a major factor in the marketing mix of services such as service customers will be happy to feel the delivery system as part of the service itself. Based on these explanations about the marketing mix, it can be concluded that the marketing mix has elements that are very influential in sales because these elements can affect consumer interest in making purchasing decisions. (Lupiyoadi and Hamdani, 2008)

Effect of Marketing Mix (7P) on Purchase Decision Every marketer will try to find information about the needs of each prospective consumer, while consumers seek information and benefits of a product or service. Consumers interpret the product or service as an urgent need or need in the future. Each consumer will know the information of a product or service through promotional activities undertaken company. Every company will try to give good promotion to its consumer, Consumer will be easy to get information about the product or service by through personal selling activity. Personal selling can affect consumer responses to a product or service, because the activities of personal selling is a promotional activity conducted between marketers and consumers directly without intermediaries (face to face) between the two sides. Each potential consumer can provide a direct perception of the product or service offered. Consumers will be influenced by personal selling activities because through personal selling activities every marketer can provide information widely, persuade, influence and invite the consumer to take action in purchasing decisions (Kertajaya, 2006). Every consumer through stages in deciding the purchase of a product or service. Some of these stages include the introduction of a problem to be able to know the needs they need in terms of benefits, the function of the product or service to be selected. Information about it can be obtained from various sources such as promotional activities through print media advertising, electronic media and various other promotional media or through personal selling, in addition to that information can also be obtained through friends, family and nearest neighbors. Some information already in the can, obtained several alternative choices about all benefits of the product or service, then consumers make an assessment of alternative products or services with benefits and information in it. (Kertajaya, 2006). Personal selling will affect the consumer through any information obtained about the benefits of the product or service. Consumers will be able to inquire directly what is not understood about the product or service to marketers, so consumers will feel a positive affinity with marketers, so that it will affect consumers in the long term. Personal selling has a big influence on consumer purchasing decisions. (Kertajaya, 2006). RESEARCH METHODS The research to be carried out includes the type of quantitative research. The analysis is done by using explanatory test that is to test the causal relationship between marketing free mix variable (7P) ie product-price-place-promotion-people-physical evidence-process to the dependent variable that is dental clinic decision decision in Surabaya city. The location of this research is the NY Dental Clinic located on Dharmahusada Indah street, Surabaya. Population is a complete group of elements, which are usually people, objects, transactions, or events that serve as the object of research (Kuncoro, 2009: 103). In a study population, although having the same elements, the population can have different characteristics, such as age, education, employment, number of children, basic salary, and so on

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(Supranto, 2008: 22). The population of this study was patients in Novendy Dental Clinic total 120 people. This research will use purposive sampling method, that is sample determination technique with special consideration so it deserves to be sampled (Sugiyono, 2010). Criteria to be sampled that is end user with age 18 years and above or considered able to fill questioner and willing to fill questioner. Samples were taken at dental clinic hours determined in June 2016. Data collection was done on weekdays. The selected respondents were taken at open clinic hours until the required number of respondents was met. The minimum number of samples calculated from the dental clinic by using the Slovin formula is the amount of sample data to be taken (92 respondents). RESULTS AND DISCUSSION Multiple linear regression equation is used in order to see whether or not the influence of independent variables are Product, Price, Location, Promotion, Person, Atmosphere, and Process on dependent variable that is Consumer Selection Decision in NY Dental Clinic. Measurements were made using SPSS 16.0 software and obtained the following results: Coefficientsa

Unstandardized Coefficients Model 1

(Consta nt)

B

Std. Error

Standardiz ed Coefficient s Beta

1.043

.049

X1

.265

.074

X2

.091

.040

X3

-.082

.028

X4

.120

.033

X5

-.170

.038

X6

.245

.071

.383

X7

.188

.059

.317

Collinearity Statistics t

Sig.

Toleran ce

VIF

21.386

.000

.394

3.574

.001

.450

2.222

.155

2.300

.024

.393

2.543

-.170 -2.886

.005

.592

1.689

3.626

.001

.941

1.062

-.289 -4.450

.000

.398

2.514

3.463

.001

.676

1.478

3.196

.002

.897

1.115

.196

a. Dependent Variable: Y The regression equation above can be explained as follows: 1. Product regression coefficient variable (X1) of 0.265 means that if other variables are fixed and the product will rise one point, then the Decision of Dental Clinic Selection will rise by 0.265. Coefficient of positive value means there is a positive relationship between the Product with dental clinic selection decision. The higher the coefficient of the product the higher the decision of dental clinic selection.

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The Fourth International Conference on Entrepreneurship | Book One

2. Regression coefficient of Price variable (X2) is 0.091 means that if the other variable is fixed and Price will rise one point, then Decision of Dental Clinic Selection will increase by 0.091. Coefficient of positive value means there is a positive relationship between price with dental clinic selection decision. The higher the price coefficient the higher the decision of dental clinic selection. 3. The regression coefficient of Location variable (X3) is -0.082 means that if the other variable is fixed and Location will rise one point, then Decision of Dental Clinic Selection will decrease by 0.930. Coefficient of negative value means there is a negative relationship between the Location with dental clinic selection decision. The higher the location coefficient, the lower the dental clinic decision. 4. Regression coefficient of Promotion variable (X4) of 0.120 means that if other variable is fixed value and Promotion will rise one point, then Decision of Dental Clinic Selection will rise equal to 0.120. Coefficient of positive value means there is a positive relationship between Promotion with dental clinic selection decision. The higher the promotion coefficient the higher the decision of dental clinic selection. 5. The variable regression coefficient Person (X5) of -0.170 means that if other variables are fixed and People will rise one point, then the Decision of Dental Clinic Selection will decrease by 0.170. Coefficient of negative value means there is a negative relationship between People with dental clinic selection decision. The higher the person coefficient the lower the decision of dental clinic selection. 6. The regression coefficient of Physical Evidence (X6) variable equal to 0.245 means that if the other variable is fixed and Atmosphere will rise one point, then Dental Clinic Selection Decision will rise by 0.245. Coefficient of positive value means there is a positive relationship between the atmosphere with dental clinic selection decision. The higher the atmosphere coefficient the higher the decision of dental clinic selection. 7. The regression coefficient of Process variable (X7) is 0.188 means that if the other variable is fixed and Process will rise one point, then Dental Clinic Selection Decision will rise by 0.188. Coefficient of positive value means there is a positive relationship between the process with dental clinic selection decision. The higher the coefficient of Process then the higher the decision of dental clinic selection. CONCLUSION Based on the results of research and statistical analysis that have been done on the influence of Marketing Mix (7P) variables are Product (X1), Price (X2), Location (X3), Promotion (X4), Person (X5), Physical Evidence (X6) Process (X7) to the decision variables Dental Clinic selection, it can be concluded the results of this study are as follows: A. The product has a significant positive effect on the Dental Clinic selection decision. With these results, it can be concluded when the product is developed then the decision of dental clinic selection will increase, and vice versa. B. Price has a significant positive effect on the Dental Clinic selection decision. With these results, it can be concluded if there is a suitability price with consumers then the decision dental clinic selection will increase, and vice versa. C. Locations have a significant negative effect on Dental Clinic selection decisions. With these results, it can be concluded when the location is developed then the decision of dental clinic selection will decrease, and vice versa. D. Promotion has a significant positive effect on Dental Clinic selection decisions. With these results, it can be concluded when the promotion is developed then the decision of dental clinic selection will increase, and vice versa.

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E. People have a significant negative influence on Dental Clinic selection decisions. With these results, it can be concluded that if people increase their age then the decision of dental clinic selection will decrease, and vice versa. F. The Physical evidence has a significant positive effect on Dental Clinic selection decisions. With these results, it can be concluded when the physical evidence is developed then the decision of dental clinic selection will increase, and vice versa. G. The process has a significant positive effect on the Dental Clinic selection decision. With these results, it can be concluded when the process is developed then the decision of dental clinic selection will increase, and vice versa. REFERENCES Alma, Buchari. (2011) Manajemen Pemasaran dan Pemasaran Jasa. Bandung : Penerbit Alfabeta. Dahlan, M.S. (2011) Statistik untuk Kedokteran dan Kesehatan. Jakarta: Salemba Medika. Departemen Kesehatan RI. (2000) Pedoman Upaya Kesehatan Gigi Masyarakat (UKGM). Cetakan Kedua. Departemen Kesehatan, Jakarta. Departemen Kesehatan RI. (2007) Laporan hasil riset kesehatan dasar (RISKESDAS) nasional. : Jakarta : Badan Penelitian dan Pengembangan Kesehatan. Departemen Kesehatan RI. (2010) Indikator Indonesia Sehat 2010 dan Pedoman Penetapan Indikator Provinsi Sehat dan Kabupaten/Kota Sehat. Jakarta : Badan Penelitian dan Pengembangan Kesehatan. Departemen Kesehatan RI. (2013) Laporan hasil riset kesehatan dasar (RISKESDAS) nasional. Jakarta : Badan Penelitian dan Pengembangan Kesehatan. Gultom M. (2009) Pengetahuan, sikap, dan tindakan ibu-ibu terhadap pemeliharaan kesehatan gigi anaknya di Kecamatan Balige, Sumatera Utara. Skripsi. Medan: Bagian Kesehatan Gigi Masyarakat USU. Kafa, R. (2013) ‘Pengaruh Bauran Pemasaran Jasa Terhadap Keputusan Pasien Dalam Memilih Jasa Rumah Sakit’, Jurnal EKBISI, VII(1), pp.105-121. Kertajaya, Hermawan. (2006) Seri 9 Hermawan Kertajaya on Marketing Mix. Jakarta : PT. Gramedia Pustaka Umum. Kotler, P., G. Armstrong. (2012) Principles of Marketing, 14th edn, Pearson Internation Education. New Jersey, USA : Pearson Prentice Hall. Kotler, Philip and Keller, Kevin L. (2012) Marketing Management 13th edn. New Jersey: Pearson Prentice Hall, Inc. Kotler

and Keller (2012). 5 Levels of Product. Available at https://brandeminence.wordpress.com/2014/01/15/256/ (Accessed : 10 June 2016)

:

Levy, Michael & Weitz, Barton. (2009) Retailing Management. New York, America : McGrawHill/Irwin. Lupiyoadi, R. , Hamdani, A. (2008). Manajemen Pemasaran Jasa. Edisi 2. Jakarta : Salemba Empat. Martono, N. (2010) Metode Penelitian Kuantitatif, Analisis Isi dan Analisis Data Sekunder. Jakarta: PT. Raja Grafindo Persada Mc Carthy & Cannon, Perreault. (2008) Manajemen Pemasaran. Jakarta : Salemba Empat.

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McLeod, Neil. (2012). ‘Enhancing the online presence of a dental practice’, Journal of Prosthetic Dentistry. Vol.107(4):271-5. Noor, Juliansyah. (2011) Metodologi Penelitian : Skripsi, Tesis, Disertasi, dan Karya Ilmiah. Jakarta : Kencana. Permenkes No. 1419/Menkes/Per/X/2005 Putri, D. E. (2011) Sistem Informasi Manajemen Klinik Gigi. Yogyakarta: Universitas Islam Indonesia. Robbiana, Inna. (2009) ‘Dental marketing dalam upaya meningkatkan keberhasilan praktek dokter gigi’. Dental Public Health Journal, I(2), pp.11-13. Solomon, M.R. (2013). Consumer Behavior : Buying, Having, and Being. Pearson Education Ltd. USA : Courier/Kendalville. Sugiyono. (2008) Statistika untuk Penelitian. Bandung : CV Alfabeta Sugiyono. (2010) Metode Penelitian Kuantitatif Kualitatif dan R&D. Bandung: Alfabeta. Sugiyono. (2010a) Metode Penelitian Pendidikan. Bandung : Alfabeta Suliyanto. (2010) Studi Kelayakan Bisnis : Pendekatan Praktis. Yogyakarta : Andi Offset. Sunyoto, D. (2009) Analisis Regresi dan Uji coba Hipotesis, Edisi Pertama. Yogyakarta : Media Pressindo Sunyoto, D. (2014) Konsep Dasar Riset Pemasaran & Perilaku Konsumen. Yogyakarta : CAPS. Supranto, J. (2009) Statistik Teori dan Aplikasi. Jakarta : PT. Gelora Aksara Pratama. Tjiptono, Fandy. (2009) Strategi Pemasaran. Yogyakarta : Penerbit Andi Tongku, C.M. (2013) Analisis Pengaruh Suasana dan Media Promosi terhadap Keputusan Pembelian di Matchbox Too Coffee & Friends Surabaya, Tugas Akhir. Jurusan Tourism and Hotel Management Fakultas Ekonomi Universitas Ciputra, Surabaya. Usri, Kosterman. (2001) ‘Mencermati Tugas Dokter Gigi Puskesmas’. Dentamedia ,IV(5). Utami, Christina Widya. (2012) Manajemen Ritel. Jakarta: Penerbit Salemba Empat William, J.Stanton. (2004) Prinsip-prinsip Pemasaran. Jakarta: Erlangga. Zethaml, Valarie, Mary Jo Bitner, Dwayne D. Gremler. (2013) Service Marketing. McGrawHill International Edition.

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FEASIBILITY STUDY BUSINESS DEVELOPMENT KEDAI KETAN "N" IN SIDOARJO 1

Insaniyatus Sakinah, 2J.E.Sutanto♠ Ciputra University Surabaya INDONESIA ABSTRACT

The feasibility analysis of business development Kedai Ketan “N” aims to analyze the feasibility of business development Kedai Ketan N in Sidoarjo in terms of aspects of environmental and industrial structures, market and marketing aspects, technical aspects, management and human resources, and financial aspects. The unit of analysis used in this study are individuals (informants) as much as 8 informants. The feasibility study examined development of this business through five aspects, namely, the environmental aspects and structure of the industry, market and marketing aspects, technical aspects, management and human resources, and financial aspect. Five aspects indicate that business development of Kedai Ketan N is acceptable and feasible for execution. To calculate the feasibility analysis of investment, used four methods of analysis, using the PP (Payback Period), PI (Profitability Index), NPV (Net Present Value), IRR (Internal Rate of Return). Overall results indicate that the business development of Kedai Ketan N is acceptable and feasible for execution. Keywords: Feasibility Study, Business Development, Family Business, Analysis

INTRODUCTION The phenomenon of teenagers who always gather and socialize in certain places is common in the community. The activity is called "hanging out". For the enthusiasts of this hangout activity, they need adequate facilities and infrastructure in the form of place, offered comfort and also the products available (Anonymous, 2012). Based on the above phenomenon, many emerging business cafes and the like to accommodate the culture. According to Chairman of the Association of Indonesian Cafe and Restaurant Entrepreneurs (Apkrindo) Jatim Tjahjono Haryono, with a population of about 4.5 million people, that number shows that culinary business is very prospective in East Java. Currently in Surabaya there are about 500-600 middle-class restaurants and above. While overall good cafes, restaurants, and depot in the middle to lower segment there are 2,000 culinary business in Surabaya and around areas. Nowadays the sticky rice has become prerequisite culinary when we visit one of the cool cities in East Java. The number of existing visitors to prove that sticky rice is one of the popular snack society. Positive response to the sticky rice then start there one by one cafe in Surabaya and surrounding areas that serve the main menu ketan such as Kedai Ketan Punel - Darmo, Ketan Mbok Ne An Cuk - Rungkut, Pos Ketan Legenda - Surabaya and Pos Ketan Legenda Sidoarjo.

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Based on the reasons and the foundation the researchers intend to develop the business of Kedai Ketan N in Sidoarjo. Sidoarjo regency is an area in East Java that has a very strategic position. In addition, Sidoarjo regency is the district with the largest SMEs in Indonesia which reached 171,264 business units in 2014. It shows that the high participation of the community to work together to drive the economy of Sidoarjo. Kedai Ketan N is a tavern that sells sticky rice with premium topping like oreo, sausage cheese, beng-beng, milo, etc. with price range Rp 5000-8000. The results of preliminary survey conducted by researchers to some people Sidoarjo, showed that 44.2% of respondents to hobbies consume sticky rice and 44.2% still do not know whether in Sidoarjo already contain a stall with main menu sticky rice. Business development feasibility study is needed to be taken into consideration in the development of Kedai Ketan N business in Sidoarjo. According to Suliyanto (2010), business feasibility studies are conducted covering environmental aspects and industrial structure, market and marketing aspects, legal aspects, technical aspects, aspects of human resources and financial aspects.

LITERATURE REVIEW Business Feasibility Study The definition of a business feasibility study is a study that aims to decide whether a business idea is feasible to implement or not. A business idea is declared feasible to implement if the idea can bring greater benefits to all stakeholders than the negative impact which is evoked (Suliyanto, 2010). The business feasibility study according to Husnan and Muhammad (2009) is a study of whether or not a project is built within a certain period of time. Feasibility studies can be utilized as a clearer focus for a business or business plan that has a logical sequence that makes it possible to reach the target or avoid the company from uneconomic investments. This research requires cost, but the cost can be minimized by this feasibility study analysis. The category of business feasibility study is divided into three categories (Subagyo, 2011), namely: new business establishment (creating a new business), business development (developing of business), and the purchase of business existing (business acquisition). The study category of feasibility studies to be conducted on this occasion is a business feasibility study on developing a business because the researcher has a business that is already running and has plans to be developed further. Environmental Aspects and Industrial Structure Every business must have consideration on the environmental aspects of the industry. This is because the environmental factors of many or few industries have a considerable influence on the smoothness of business / business. The analysis done in the environmental aspects of the industry is PEST analysis (political, economical, social and cultural, and technological) and the five power analysts (Suliyanto, 2010). According to Porter in (Suliyanto, 2010) divides the five forces that determine the level of competition in an industry, namely: (a) entry of newcomers, (b) threat of substitution products, (c) bargaining power of buyers, (d) Bid on suppliers, (e) Competition among existing competitors. To formulate a marketing strategy, is supported by SWOT analysis (Strength, Weakness, Opportunity, Threat) that is comparing internal company environment condition (strength and weakness) with external company environment condition (opportunity and threat) (Kodrat, 2009) .

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Market and Marketing Aspects Analysis of market and marketing aspects plays a very important role in developing the business because the main source of revenue comes from the sale of products produced. The analysis of market aspects analyzes the number of products offered by competitors. While the analysis of marketing aspects to analyze the way or strategy for the resulting product can be up to the consumer with more efficient than competitors (Suliyanto, 2010). Marketing strategy that supports the achievement of marketing in accordance with the wishes, namely (Purwana, 2016): Strategy (1) Segmenting (market segmentation), (2) Targeting (market setting), (3) Positioning (market positioning), or it is known by STP Strategy. Marketing by Kartajaya (2010) has a strategy called marketing mix or better known as the 4P theory: (1) Product, (2) Price, (3) Place, (4) Promotion. Technical Aspects Frequent business / business failure is unable to face technical problems. Therefore, technical aspect analysis is used to answer the question whether the business is technically feasible or not (Suliyanto, 2010). Things that need to be analyzed in technical aspect in this research are: (1) selection of business development location, (2) determination of business place layout, (3) visual merchandising concept. Aspects of Management and Human Resources Human resource aspect is an important aspect and needs to be analyzed as well as development materials from a business / business. The role of human resources is no longer as a technical exercise, but as a partner in the company to be actively involved in the effort to realize competitive advantage (Kodrat, 2009). Discussion in the aspect of human resources includes: organizational structure, procurement of labor, and compensation and benefits. Financial aspect Financial aspect is a very important aspect in preparing or running a business. In preparing a business, the financial aspect becomes the main reference to the business either to be created or that has been made to assess whether the business is feasible to run or not. A profit-oriented business will decide to run a business idea if the business is financially profitable, while a nonprofitiented business requires a financial feasibility study to answer the question of whether the business idea will continue to run in an effort to carry out its social mission with revenue Which he received (Suliyanto, 2010). The financial aspect includes information and data from all other aspects to be incorporated in the financial statements. The financial statements will be analyzed by means of investment valuation criteria, namely: Net Present Value, Internal Rate of Return, Payback Period, and Profitability Index (Muslich, 2009). RESEARCH METHODS This research is an applied research, that is research which concerns the application of a theory to solve a certain problem (Kuncoro, 2009). Applied research is conducted with the aim of applying, testing and evaluating the ability of a theory applied in solving practical problems (Neolaka, 2014). The place of study is determined based on the location of Kedai Ketan N that is Sidoarjo regency and begun in September - November 2016. The sampling method uses Saturation Sampling because the population is small. Where Saturation Sampling method is a method with sampling by involving all members of the population as sample (respondent) research. This method aims to obtain data effectively and

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accurately in accordance with the needs required by researchers, so the data obtained is really accurate. Interview was conducted to the regular customers from Kedai Ketan N in Sidoarjo, food enthusiast in Sidoarjo, owner of Kedai Ketan and Chairman of Apkrindo (Association of Indonesian Cafe and Restaurant Entrepreneurs) East Java. The unit of analysis that is used in this study is the individual (informant). Individual analysis units are selected to explore individual knowledge and opinions as supporting data in the analysis. The informants used are permanent customers of Kedai Ketan N in Sidoarjo, food enthusiast (owner of culinary instagram account) in Sidoarjo, owner of Kedai Ketan B in Probolinggo as the supplier and Chairman of Apkrindo (Association of Indonesian Cafe and Restaurant Entrepreneurs) East Java. Data collection methods in this study using data promer and secondary. Primary data is data obtained by self through interview, observation and questionnaire (survey). Secondary data, ie data obtained from second source through document / literature study. Data analysis from this research is done by analyzing every aspect that is studied, that is environmental aspect and industrial structure, market and marketing aspect, legal aspect, technical aspect, human resource aspect, and financial aspect. The data can be declared valid if there is no difference between the reported by the researcher with what actually happened to the object under study. According to Yin (2009), there are four kinds of testing to validate data through construct validity, internal validity, external validity, and reliability. RESULTS AND DISCUSSION Environmental Aspects and Industrial Structure PEST (Politic, Economy, Social, Technology) 1. Politic The political situation in Indonesia which tend to be stable for culinary business makes the cafe and its like business popping up including Kedai Ketan N. Currently in Surabaya there are about 500-600 upper middle class restaurants. While overall good cafe, restaurant, and depot in the lower middle segment there are 2,000 culinary business in Surabaya. According to the Chairman of the Association of Indonesian Cafe and Restaurant Entrepreneurs (Apkrindo) Jatim Tjahjono Haryono, with a population of about 4.5 million people, that number shows that culinary business is very prospective in East Java. 2. Economy LM-FEUI research bureau publishes macroeconomic projections for 2011-2015 which also shows the restaurant business prospects. The LM-FEUI projection data shows that the growth of market size of the economic sector in restaurant business in 2011 is 13.90% projected to increase to 15.00% in 2014. This increase is expected to continue to grow to 15.50% by 2015 (LM-FEUI, 2011).

3. Social Phenomenon Hanging out support the business of Kedai Ketan N as one of choice of hangout in Sidoarjo region. The more often people who do hanging out activities, the greater the opportunity to develop Kedai Ketan N by following what consumers want. 4. Technology Nowadays Internet technology is growing very rapidly. Entrepreneurs can make sales online so as to provide convenience for customers. One currently used is to make social media an interactive communication tool between entrepreneurs and customers. So did the Sticky N Store by using social media such as instagram for promotion and direct communication with customers.

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Five Forces Analysis The description of the five forces in the business can be seen in Figure 1 below. Five Forces Analysis Kedai Ketan N New Arrivals Thre at

Competition among Competitor s

Supplie rs Bidding P ower

4 3 2 1

Product Replacement Thre at

Five Forces Analysis Kedai Ketan N

Buyers Bidding Power

Figure 1. Five Forces Analysis of Kedai Ketan N In Figure 1 above describes the condition of the five forces in business. The buyer is an important aspect in business because a buyer who will use the products offered by a company and the company will earn income also from the buyer. Currently there are quite a lot of glutinous rice stalls in the market, especially in Sidoarjo. Therefore, the company must be able to provide products that can meet customer desires and can satisfy customers more over the loyal customers, with the company's products. Kedai Ketan N has had several regular customers during the walk approximately 2 this month. But consumers still have the freedom to choose other glutinous rice stalls in accordance with the wishes of each. This condition shows the bargaining power of consumers enough to affect the business run. The existence of a supplier is very important for a business that is run so that its production can be done continuously. Products from suppliers are raw materials to make sticky rice, both from the main raw material and topping used. The number of Kedai Ketan N suppliers for now is quite a lot, so the companies are free to choose the suppliers they want. Especially for soy powder is only supplied from Kedai Ketan B in Probolinggo. This condition indicates that the bargaining power of suppliers is quite influential on the business run. The level of competition in the business also needs to get the attention of the company. Currently the number of competitors in the business is quite a lot of sticky rice in Sidoarjo, but the good growth makes the glutinous rice market get their respective. But the attractiveness offered from each competitor greatly affects the consumer. These conditions indicate that the level of competition is very influential on the business undertaken. The threat of new entrants in business is always there. The glutinous rice stall continues to experience a good development, seen from the emergence of some sticky rice stalls in Sidoarjo so that the possibility of new arrivals in quite threatening. Anticipating the threat of newcomers, the business should be run should have its own characteristics or uniqueness that will cause consumers loyal to the products that have been offered. This condition indicates that the threat of newcomer enough to affect the business undertaken. Substitution product threats show results that have no effect on the business undertaken. It is seen that there is no similar product with the glutinous flavor and texture. However, if based on the function of the sticky rice itself is a filling snack, then there are some snacks replacement offered in the market. SWOT analysis

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The next step is to do SWOT analysis to know the internal and external conditions of the company. Identification of S (Strength), W (Weakness), O (Opportunity), and T (Threat) based on interview result are as follows: a. Strengths: 1) Presence of delivery service for Sidoarjo city area 2) Variations of topping a lot 3) The place is comfortable, clean and available Wi-Fi b. Weaknesses: 1) The offered price is almost the same as the other sticky rice stalls 2) Consumer confidence is still low, because the business is still new 3) The place is small and less visible from the highway c. Opportunities: 1) The market share is very wide 2) The product is not seasonal so it can be run at any time 3) The glutinous business continues to grow d. Threats: 1) The product is easy to be imitated, although it has advantages that highlighted 2) Excellence of competitors 3) The existence of replacement products Market and Marketing Aspects STP (Segmenting, Targetting, Positioning) Segmenting Kedai Ketan N is segmenting its customers based on psychographic conditions where Kedai Ketan N is in a society whose hobbies hang out and then look for a place that offers an atmosphere or an instagram-able product. Table 1. Segmentation of Kedai Ketan N product Premium Topping Original Topping Hangout way 1 3 Instagram-able 2 4 Source: Processed Data (2017) Targeting Based on the interview results, the target of Kedai Ketan N is at number 1 and 2 (Table 1) where buyers are hobbyist people hanging out looking sticky rice with premium toppings and the product is interesting to be photographed (instagram-able). Positioning Kedan Ketan N is positioned as one of the preferred places to hang out to enjoy its product is ketan with premium topping which the product is interesting to be photographed (instagramable). The products made have the advantage in terms of taste and the type of toppings offered. The typical taste of soy powder in Kedai Ketan N is specially formulated so it has a different taste from other sticky rice stalls. In addition, premium topping options offered until now there are 13 and can be mixed and match by consumers themselves. Marketing Mix Product The main product offered Kedai Ketan N is glutinous with 13 choices of premium topping. In addition there are several snacks and drinks are also offered by Kedai Ketan N as a complement. The logo and brand of Kedai Ketan N is taken from the nickname of the 2nd daughter of the owner. The name is expected to be a brand that attracts attention and is easy to remember by the customer.

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Products are served on small plates equipped with small spoons and label flags over the sticky rice when eaten in place. When the product is brought home by the customer, the product is placed on a plastic mica packaging equipped with a plastic spoon, oil paper and sticker. Stickers serve as labels that describe brands, addresses, instasses and numbers that can be contacted by customers. Price Pricing on the Kedai Ketan N based on competition (Competition Based Pricing) is pricing by considering the price set by the competitor. Glutinous price offered by Kedai Ketan N around Rp 5,000 - Rp 8.000, while for the new menu is sticky rice durian sold at Rp 12,000. Place Location Kedai Ketan N is located in Gading Fajar 2 Block D 03 No 7 Sidoarjo. This location is located in the western ring area of Sidoarjo, where the residential highway is a location used by street vendors to sell every day, so ascertained this area crowded throughout the day. But the condition of the place is still too small. Promotion Some promotions that have been done by Kedai Ketan N is promo BOGO (Buy One Get One) Free original sticky rice in the first month. In the second month followed by promo Buy 2 Get 1 Free sticky original for 1 full month. Also inserted the distribution of free glutinous meal vouchers distributed to certain groups as a strategy to enliven the shop. The promotions are advertised on instagram, banner and brochure. The next promotion that will be done is to use instagram-able itself. Where everyone who comes and eats at Kedai Ketan N then photographs and uploads on their instagram, it will get a free sticky rice on the spot. In addition to those who can not come to the shop, there is a race with a repost one of the photos on the instagram and then tagged 5 friends with an interesting comment, will get a free meal voucher at Kedai Ketan N. Instagram utilization as a media campaign or a means closer To the customer is one of the most influential factors. Technical Aspects Business Location Location Kedai Ketan N is located in Gading Fajar 2 Block D 03 No 7 Sidoarjo. This location is located in the western ring area of Sidoarjo, where the residential highway is a location used by street vendors to sell every day, so ascertained this area crowded throughout the day. The location is classified into a strategic location to open a business so the selection of Kedai Ketan N location is appropriate. Business Layout Kedai Ketan N store is located in Gading Fajar 2 Block Blok D 03 No 7 currently has a building with an area of 77 m2 (11 m long and 7 m wide). This condition is small for the size of a store whose market share is wide.

Figure 2. Kedai Ketan N Layout Visual Merchandising Concepts

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The visual concept that exists in Kedai Ketan N is very simple as seen in these pictures below.

Figure 3. Kedai Ketan N Visual Merchandising Concept Aspects of Management and Human Resources Kedai Ketan N has an organizational structure, but it is still simple. This organizational structure is the relationship between superiors and subordinates who are still directly with one line of authority. This structure is used because the number of existing employees is still small. Permanent Personnel Workforce of Kedai Ketan N currently amounts to five people ranging from person in charge, operational, financial and 2 person service. The advantages of this organizational structure are easy to implement coordination, faster decision-making processes, and more effective oversight. The disadvantage is that the organization is too dependent on the leadership, the lack of skilled staff, and the employee's opportunities to develop are rather limited. The salary given by Kedai Ketan N has not been able to reach the Regional Minimum Wage of Sidoarjo Regency because the business is still relatively small. The amount of Regional Minimum Wage for Sidoarjo Regency is Rp 3,040,000 (Jatimprov, 2016.). The basic salary for the service is Rp 1,000,000 / month, plus a meal allowance of Rp 10,000 / day. Financial aspect The financial aspect is the last aspect used to assess the business development undertaken at Kedai Ketan N worth doing or not. Financial aspect analysis is divided into three categories, namely normal conditions, optimistic conditions and pessimistic conditions. Normal conditions are the most likely conditions to occur. Optimistic conditions are the best conditions that can be achieved, while pessimistic conditions are the worst conditions that may befall the company. Table 2. Feasibility of Financial Aspects Normal Pessimistic Provision Provision Condition Condition PP PP < 4 Years 6 Months 1 Year 3 Months PI PI 4 Years > 1 Rp 6,9 Rp 3,1 NPV NPV 4 Years > Rp 104.739.172 Rp 47.094.503 Rp 0 IRR 130% 48% In normal In pessimistic conditions the condition the four provisions four provisions of eligibility are eligibility are met met Source: Processed Data, 2017

Optimistic Condition 3 Months Rp 17,3 Rp 264.817.174 343% In optimistic condition the four provisions eligibility are met

CONCLUSSION Environmental Aspects and Industrial Structure Based on the results of environmental analysis and industrial structure can be seen that the political situation in Indonesia tends to be stable for business in the field of culinary, economic conditions will also be projected to increase from year to year, while from the social side that is

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the phenomenon of hanging out that has become the culture of Indonesian society including in Sidoarjo, While the influence of technology is very important for promotional purposes. Based on the PEST that has been analyzed can be concluded that the existence of Kedai Ketan N can enliven the culinary business that began to bloom in Sidoarjo. Based on the Five Force Analysis analysis of glutinous rice can be seen that of the five forces in the industry, the three forces are the threat of newcomers, bargaining power of buyers, bargaining power of suppliers enough to affect the business run, while competition among competitors is very influential Against the business being run, while the threat of replacement products has no effect. Market and Marketing Aspects Currently culinary glutinous business began to rage, including the people of Sidoarjo. Evidenced by the inclusion of one of the competitors from Kedai Ketan N which already has a strong branding that is stalled street vendors to Sidoarjo. In addition, some competitors who also began to appear illustrates that the glutinous rice has a large market size, although divided by many players. The research conducted on Ketan N Stores through STP analysis and marketing mix shows that Kedai Ketan N is feasible to be developed because the market is still wide open. Although the number of competitors is quite a lot, but will still gain its own market. Kedan Ketan N is positioned as one of the preferred places to hang out to enjoy its product is ketan with premium topping which the product is interesting to be photographed (instagram-able). The offer of topping that can be mixed and match is also a special attraction that is occupied with an affordable price. An interesting promotion is also done by companies like buy 1 get 1 free for, buy 2 get 1 free and free meal vouchers to attract new customers. Technical Aspects Kedai Ketan N has determined the location of business development that is in Gading 2 Housing located in the western circumference of Sidoarjo. Selection of this location with consideration of this crowded area throughout the day. The existing visual concept applied in Kedai Ketan N is very simple. Installation of neon box and plaque aims to look attractive when viewed from the outside. Elements used to fill the room is also minimalist with shades of green and yellow so that the shop always looks fresh every day. Aspects of Management and HR (Human Resources) Simple organizational structures have been formed by the Sticky N Store accompanied by the terms and expertise of the employees. The recruitment process runs smoothly with 2 employees who are in accordance with the existing specifications. The salary given for the service is still below the Regional Minimum Wage considering the condition of the shop which is still relatively small and will be updated as the company grows. Financial aspect The projected financial reports projected income statement and cash flow statement from 20162019. The method used is PP (Payback Period), PI (Profitability Index), NPV (Net Present Value) and IRR (Internal Rate of Return). All of these investment rating criteria show a positive response in both normal, pessimistic and optimistic conditions. Based on the results of feasibility analysis that has been made, it can be seen that the business feasibility criteria of the financial aspects have been met. REFFERENCES Anonim. (2012). http://e-journal.uajy.ac.id/274/2/1KOM03575.pdf. Diakses tanggal 23 Oktober 2016. Husnan, S. dan Muhammad. (2009). Studi Kelayakan. Yogyakarta: Graha Ilmu. Kodrat, David Sukardi. (2009). Manajemen Strategi: Membangun Keunggulan Bersaing Era Global di Indonesia Berbasis Kewirausahaan.Yogyakarta: Graha Ilmu.

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Kuncoro, M. (2009). Metode Riset untuk Bisnis dan Ekonomi. Edisi Ketiga. Jakarta: Erlangga. LM-FEUI. (2011). Proyeksi Ekonomi Makro 2011-2015. http://www.lmfeui.com/data/Proyeksi%20Ekonomi%20Makro%20LM%20FEUI.pdf. Diakses tanggal 23 Oktober 2016. Muslich, Mohammad. (2009). Manajemen Risiko Operasional : Teori dan Praktik. Jakarta: Bumi Aksara. Neolaka, Amos. (2014). Metode Penelitian dan Statistik. Bandung : PT. Remaja Rosdakarya. Subagyo, Ahmad. (2011). Modul Studi Kelayakan Bisnis. Jakarta: PT Elex Media Komputindo. Suliyanto. (2010). Studi Kelayakan Bisnis: Pendekatan Praktis. Yogyakarta: Penerbit Andi. Yin, R. K. (2009). Case Study Research Design and Methodhs, 4th edition. California: Sage Publication.

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DESIGNING BLUE OCEAN STRATEGY MODEL AT PT. NATURAL SOURCE INDOLESTARI 1Ryan Pramuditya, 2Christina Whidya Utami♠ Ciputra University Surabaya INDONESIA Email: [email protected], [email protected]

ABSTRACT This study aims to identify Key Success Factor PT. Sumber Alam Indolestari and identify Key Success Factor that must Eliminate, Reduce, Raise, and Create in accordance with the rules of the Blue Ocean Strategy. The variables studied in this research is data internal and external conditions, which were analyzed using analysis tools VRIO, 5 Forces Porter's model, and can therefore be identified Pestle TOWS analysis of PT. SAI. Furthermore, the Strategy Canvas technique to determine the level of competition PT. SAI with two competitors in terms of the price, profitability, growth, sustainability, competitiveness, and operational project quality. Based on the analysis that has been made known that Key Success Factor is the cost of office operations, avoid project waterproofing and floor hardener, product knowledge, market penetration, in cooperation with the applicator another, meeting coordination team, the innovation of new products, the relationship with the lab, a trading division and property.. Keywords: Key Success Factor, Blue Ocean Strategy, Innovation, ERRC, Strategy Canvas, Competition, Dan Diversification.

INTRODUCTION The rise of existing construction projects in major Indonesian cities has triggered many new construction companies to emerge, leading to increased competition in the construction industry. Increased competition is felt in many high rise building projects, such as apartment / hotel projects. Taken from the Central Bureau of Statistics, it is seen that there is a significant growth of construction projects from year to year, in 2011 to 2012 there is a growth of 18.19%, while 2012 to 2013 there is a growth of 15.39%. This indicates there is an enlarged market size. PT. Sumber Alam Indolestari (SAI) is one of the companies engaged in the construction sector specialized in the field of concrete repair services as the core business is run. Along with the development of the construction industry in major cities of Indonesia, there is a growing demand for companies providing specialized construction services in the field of concrete repair. So many emerging new construction companies from year to year. It can be seen that in 2013, the number of construction companies in East Java is the largest of 15,954 listed companies. This large number of companies indicates the competition in the

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construction field is very heavy and the future will be more severe, it needs an innovation applied to the company in order to survive in this construction industry. Seeing such conditions, companies want to find opportunities in other projects that still have no competitors. This tight competition is a strong reason to use the Blue Ocean Strategy (BOS) approach. BOS is a business strategy used to find new spaces in the business that can improve process efficiency and performance. In the Blue Ocean Strategy theory created by Professors W. Chan Kim and Renee Mauborgne stated that the way to win intense competition in the Red Ocean zone is to look for Blue Ocean, which emphasizes the creation of a market space that has no competitors yet, focusing on The growth of demand and movement away from the competition. It is expected that the implementation of this strategy can improve the competitiveness of the company by using high technology in the work process, entering new market with high entry barrier supported by human resources and technology having special qualification The result of business analysis resulted from BOS will be adjusted with business activities that exist in the company, expected to support management strategy in reaching company goal in face of existing competition LITERATURE REVIEW Previous research The first research used as a reference was conducted by Wang Zhao and Yang Jinwei (2012) on "Application of Blue Ocean Strategy to Chinese 3G Mobile Telecom Industry." The Blue Ocean Strategy application is applicable to China Telecom industry. The second study was "A blue ocean strategy explanation of the IMAX Move to Hollywood" by Hilary M. Becker (2014). This study discusses the move from IMAX from the educational film market to the Hollywood film market and evaluates against the Blue Ocean Strategy framework. The author observes that the growth and development of the home entertainment industry creates a change in market dynamics and draws viewers away from educational entertainment such as museums and zoos, which became IMAX's target market initially. IMAX made an important step to enter the Hollywood film market. The authors interpreted these steps using the BOS framework and tools such as the Six Paths Framework, ERRC Framework, and canvas strategy and concluded that with this strategic step IMAX is creating blue ocean with satisfying market and financial results. The third study is "Design of Blue Ocean Strategy model at PT. Saptaindra Sejati - Adaro Energy Group "by Tengku Shahindra (2013). This research aims to design Blue Ocean Strategy model at PT. Saptaindra Sejati which aims to provide strategic direction for company management. The fourth study "Evaluation of Blue Ocean Strategy on Television Station" by Asima Oktavia Sitanggang (2012). The purpose of this research is to describe market structure, market conduct, and performance in Indonesian broadcasting market. The fifth research is "Blue Ocean Strategy Approach to Improve Drug Service Strategy at K24 Pharmacy (Case Study of K-24 Pharmacy Antapani)". This study aims to create a new corporate strategy design that fits into the three blue ocean strategy traits in creating an unattended market space that is the focus, divergence, and alluring motto. The conclusion of the above research is to provide strategic direction for company management by applying Blue Ocean Strategy, and to compile Blue Ocean Strategy required tools such as, BOS framework, Framework, ERRC Framework, and canvas strategy. From Sitanggang research result, described structure, market conduct, and performance on market. Strategy Porter (1996) as quoted by Shahindra (2013: 9) defines strategy is a formula that generally refers to how business will compete, what goals to achieve, and what policies are needed to achieve those goals. The main point of the competitive strategy formula is to connect the

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company to its environment. So basically there needs to be a good strategy for the company to achieve its goals. Kim and Mauborgne (2005: 65) regretted the phenomenon commonly done by industry players, who are generally reactive, followers (follower) or follow the tendency of other industrial actors. Industry players should create new business conditions, namely conditions that are Blue Ocean in the situation. Strategic Management Science management has a rapid development in accordance with the progress of the era. According to David (2006: 1), strategic management is the art and science to formulate, implement and evaluate cross-functional decisions that enable organizations to achieve their goals To achieve corporate objectives through strategic management, according to David (2006: 1) the company needs to go through the stages of the strategic management process as follows: A. Strategy formulation. B. Implementation strategy. C. Strategy evaluation. SWOT Analysis According to Kurtz (2008: 45), SWOT analysis is an important strategic planning tool to help planners to compare internal strengths and weaknesses of organizations with external opportunities and threats. According to Pearce and Robinson (2003: 134), SWOT analysis needs to be done because the SWOT analysis to match the "fit" between internal resources and the company's external situation. A good match will maximize the company's strengths and opportunities and minimize its weaknesses and threats. This simple assumption has strong implications for the design of successful strategies. According to Wikipedia, SWOT analysis (abbreviation of strengths, weaknesses, opportunities, and threats) is a strategic planning method used to evaluate the strengths, weaknesses, opportunities, and threats in a project or a business speculation. This process involves specifying the specific objectives of business or project speculation and identifying internal and external factors that support and which are not in achieving that goal. According to Bradford and Duncan (2007: 142), analyzing the internal and external environment is important in the strategic planning process. Internal environmental factors within the firm can usually be classified as Strength (S) or Weakness (W), and the company's external environment can be classified as Opportunities (O) or Threat (T). The environmental analysis of this strategy is referred to as the SWOT analysis. A company does not always have to pursue a profitable opportunity because by developing competitive advantage, there is a better chance of success by identifying an upcoming strength and opportunity. In some cases, companies can overcome their weaknesses by preparing themselves for a definite opportunity. To develop a strategy that considers the SWOT profile, the SWOT matrix (also known as TOWS Matrix) is shown in Figure 1. Figure 1. SWOT / TOWS Matrix

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Blue Ocean Strategy Since strategic management was introduced, the ultimate goal is to pursue competitive advantage in existing markets. Blue Ocean Strategy is a completely new strategy compared to others. Kim and Mauborgne (2005) were quoted by Shahindra (2013: 11), dividing the market into two parts: the Red Ocean and the Blue Ocean. The "red sea" is explained because of all the existing industries that are well known market spaces. The "blue ocean" refers to any industry that does not exist today which is an unknown market space. Blue Ocean vs. Red Ocean In the Red Ocean, market boundaries are clearly identified, crowded market space, limited prospects for growth and profit, competition in the red ocean turns into bloody competition. In contrast, blue oceans are defined as new spaces where market boundaries, and industrial structures are not supplied and can be reconstructed. In the Blue Ocean, competition is irrelevant because the rules of the game have not been set. This is a new outlook that has previously been the entire company strategy of Red Ocean Strategy. Value innovation in BOS is not the same as technological innovation. Value innovation rejects the most commonly used dogma in a competition-based strategy that is: a tradeoff or cost tradeoff, as a consequence of an application of innovation. There, the strategy is seen as a maker of choice between differentiations and low cost. In contrast, BOS makes companies pursue differentiation at low cost simultaneously, or in other words get a low cost while obtaining value. RESEARCH METHODS This research will be a type of strategic plan. This study is directed to arrive at a strategic managerial strategy decision in a company supported by clear and logical analysis and argumentation. Decision of managerial strategy in this research in the scope of Strategic Business that is Blue Ocean Strategy. So the approach used this research to dig the information data in field is approach and qualitative research. The object of this research will be PT. Sumber Alam Indolestari, is one of the companies engaged in the construction sector specialized in concrete repair services as the core business, headquartered in Surabaya. The selection of this research object is done purposively based on consideration of ability of power, cost, resources, and time owned by writer. In addition, the writer's understanding of the internal condition of the company and its industry can facilitate the depth of analysis and the accuracy of the recommendations produced. The time of research will be done starting December 2015. After that proceed with thesis writing process. This research using interview method and sampling method used is Saturation sampling. Where this method is a method with sample invitation by including all members of the population as research samples. This method aims to be able to obtain data effectively and accurately in accordance with the necessary requirements, so that the data obtained is really accurate and useful. In this research will conduct an interview to Mr. Ir. Setyo Poernomo as the owner of PT. Sumber Alam Indolestari, Mr. Dicky Soelistyo as Operational Manager of PT. SAI, Mr. Koento Wibowo as Marketing Manager of PT. SAI, and Mr. Bagoes selected as Finance Manager of PT. SAI. The collected data will then be processed using descriptive - qualitative analysis. Descriptive - qualitative analysis is a technique to describe and interpret the meaning of data - data or processed data gathered, in order to obtain a general or comprehensive picture. The company's external data will be analyzed descriptively - qualitatively as well as the

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company's internal data. The results of the analysis are interpreted to obtain TOWS Strategy as an initial strategy for the company. Next is a new strategy re-formulation with Strategy Canvas analysis tool, Four Actions Framework, and ERRC grid according to Blue Ocean Strategy theory, in order to produce New Proposed Strategy that is Blue Ocean. RESULTS AND DISCUSSION In this section will be analyzed descriptively - qualitatively about the gap between proposed strategy with current strategy. Gap analysis is done to find out the suitability, similarity or difference between the strategy created (Strategy ST) with the existing strategy. The ST strategy is formed based on analysis and synthesis, then compared with the existing strategy of Corporate Strategy SAI 2017 which has been established by the Board of Directors. Figure 2 TOWS Matrix

Based on Figure 2, as a representation of the Cartesian chart of the TOWS strategy, the ST Strategy choice is located in the Diversification Strategy quadrant, which uses internal strength to avoid external threats. To form an ST strategy item, each strategy matrix item needs to be linked in the form of realism, resulting in the synthesis of the strategy item. Weihrich (2010) as quoted by Shahindra (2013: 79), suggests to provide a relation of each item each condition to produce a relative strength relational approach.

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Table 1 Synthesis relative strength relation Strategy S – T

From the synthesis according to table 1, 6 ST strategies were formed as the initial result of TOWS Matrix formation. Canvas strategies are used to understand where competition is currently taking place, and understand what factors are being competed in construction chemicals' products or services and what clients get as competitive bids. Measures of success of companies, especially construction service companies can be seen from the factors that indicate the company is a success. The company's indicators can be categorized into a successful construction company: A. Price, the ability of the company to compete with price. B. Profitability, the company's ability to earn profits. C. Growth, the ability to continue to grow and develop, D. Sustainability, ability to obtain sustainable projects. E. Competitiveness, the ability of the company to compete. F. Project Operational Quality, quality of work performed Based on the results of interviews on key positions in the company, obtained SAI Canvas Strategy compared to main competitors No.1 and No. 2 in the services of construction chemicals presented in Figure 3

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Figure 3 Chart of Strategy Canvas SAI with competitors no. 1 and 2

In this section is the re-formulation stage of making the Blue Ocean strategy with a four-step framework (4 Action Framework). Creation of new values is done first by creating a four-step framework (4 Action Framework), which consists of: • ERASE. What factors should be "wiped out" of the factors that have been taken for granted by the construction chemicals service industry, so that SAI can become a major player in construction chemicals services. • REDUCE. What factors should be "reduced" from existing ones, so the SAI is able to bounce back and outperform its competitors. • RAISE. What factors should be "upgraded" until the SAI can be above the existing construction chemicals service industry standards. • CREATE. What factors have not been offered by other construction chemicals industries, so should be "created" by SAI in order to excel. Table 2 ERRC Grid for PT. SAI

Eliminate - Hapuskan Marketing Support Staff Tax Staff

Raise - Tingkatkan Product Knowledge Market Development Cooperate with other field applicators

Reduce - Kurangi Floor Hardener, Waterproofing, and many other jobs that has too many competitors

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Improve the quality of weekly meetings Create - Ciptakan Establish partnership with suppliers for new product innovations: antifouling paint for docks, and underwater coating Relationships with material research center and concrete

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technology Has a Concrete Repair Consultant Trading / Retail Division Property Division Based on Table 2, a new canvas strategy can be constructed as shown in Figure 4.

Figure 4 The new SAI Canvas Strategy Graph is to be in the ERRC

To be able to implement the new strategy hence needed some adjustment of managerial strategy. Because when companies reduce the number of employees to reduce costs and at the same time also adds a new division managerial strategy is required: 1. With the opening of a new division of trading and property division, it is necessary to add responsibilities to existing employees. Trading Division is under Marketing Director of PT. SAI, while the Property Division is under Operational Director of PT. SAI. 2. Implementation in the field will be outsourced in accordance with the project / existing customer later. So the cost to the company for additional divisions can be reduced, because the source of funds from outsourcing employee financing taken from the existing project. CONCLUSION Based on the results of research and discussion that has been done about "Design of Blue Ocean Strategy Model at PT. Sumber Alam Indolestari ", then obtained the following conclusions: 1. Based on the result of the analysis, it is concluded that 8 (eight) Key Success Factor PT. Sumber Alam Indolestari is: a) Price, the ability of the company to compete with price. b) Profitability, the company's ability to earn profits.

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c) Growth, the ability to continue to grow and develop, d) Sustainability, ability to obtain sustainable projects. e) Competitiveness, the ability of the company to compete. f) Project Operational Quality, quality of work performed 2. Of the six Key Success Factors, points are obtained that correlate with Key Success Factor: a) The number of additional employees who inefficiently burden the office's operational costs (sustainability, project operational quality) b) Product knowledge of new materials circulating in the market (competitiveness, growth). c) Market development to new market segments (growth, sustainability). d) Cooperation with other applicators who are still "inline" with the business of PT. SAI (growth, sustainability, competitiveness). e) Reduces the jobs of many competitors (competitiveness). f) Work with suppliers to develop new product innovation (profitability, growth, competitiveness). g) Improve the quality of weekly meeting for time efficiency (profitability, project operational quality). h) Relation with research centers of materials and technology of concrete (growth, sustainability). i) Has own concrete repair consultant (competitiveness, sustainability, growth). j) Creating a new division engaged in property (profitability, growth, sustainability) k) Creating a new business division in the field of trading / retail that serves existing SAI customers as well as new customers. (Profitability, growth, sustainability). 3. Key Success Factor that must be in Eliminate, Reduce, Raise, and Create are as follows: a) Eliminate / Eliminate:  The number of additional employees who are inefficient burden the office's operational costs, ie marketing support staff, and office tax administration staff. The solution meengefisienkan existing employees and utilize tax consultants to help tax administration office. b) Reduced / Reduce:  Reduce jobs - jobs that many competitors, namely the work of Floor Hardener, Waterproofing, and others. Because the jobs are burdening the operational due to overly tight competition and results that do not meet the needs of the office. c) Enhanced / Raise:  Product knowledge of new materials circulating in the market.  Cooperation with other applicants who are still "inline" with the business of PT. SAI, such as painting applicators, epoxy flooring, firestop installation, welding and ship repair, cathodic protection, underwater services, and so on.  Quality weekly meeting. By always making minutes of meeting for the development of meeting results are always recorded and controlled. d) Created / Create:  Work with suppliers to develop new product innovations, such as antifouling paint for docks, and underwater coatings.  Relation with research centers of materials and concrete technology. This relationship is necessary because it has never been done by other competitors, nor the whole company problems or agencies associated with the concrete must come here, so that by establishing relationships such as training or joint

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research can instill the mindset to the market that PT. SAI is a competent company in the field of concrete repair.  Has own concrete repair consultant. This consultant will support the performance of PT.SAI because every concrete repair work must be preceded by an initial structure audit, and PT.SAI already has the network and resources to implement this which is not owned by other competitors.  Retail / trading division with existing SAI clients, customer benefits will be more loyal to SAI because it can meet their needs.  Property division, beneficial to diversify source of income so that SAI is not too dependent on fluctuations in the ups and downs of the existing projects, also helps SAI from the financial side. Some customers are also not a few who ask the PT. SAI in the property field, but still can not be fulfilled. Now with existing resources and funders who want to fund this then there is no obstacle PT. SAI to start this division. REFERENCES Becker, Hilary M. 2014. A blue ocean strategy explanation of the IMAX Move to Hollywood. Journal of International Management Studies. David, Fred. R. 2006. Manajemen Strategi. Buku 1, Edisi kesepuluh. Salemba Empat. IBM. (2005) Strategic Innovation: Strategic Canvas & 4 Action Framework. Ibm Executive Development Program Business Institute Report. Internet: bisniskeuangan.kompas.com Internet: www.bin.go.id Internet: www.bps.go.id Internet: www.datastatistik-indonesia.go.id Internet: www.presidenri.go.id Internet: www.surabaya.go.id Kim, W. Chan & Mauborgne, Renee. (2005). Blue Ocean Strategy. Harvard Business Publishing, USA. Pearce, John A. dan Robinson, Richard B. 2013. Manajemen Strategis: Formulasi, Implementasi, dan Pengendalian. Salemba Empat. Jakarta Porter, Michael. (1980). Competitive Strategy : Techniques for analyzing Industries & Competitors. Harvard Business Review. Porter, Michael. (1996). What is Strategy. Harvard Business Review, Nov-Dec issue page 6168 Rangkuti, Freddy. 1997. Analisis SWOT Teknik Membedah Kasus Bisnis. PT. Gramedia Pustaka Utama. Robert W. Bradford, Peter Duncan, dan Brian Tarcy, Simplified Strategic Planning : A Nonsense Guide for Busy People Who Want Result Fast McGraw Hill. Thompson, (2008), Crafting & Executing Strategy; The Quest for Competitive advantage, sixteenth edition, McGraw-Hill International Edition. Weirich, Heinz. (2010). TOWS Matrix – A tool for situational analysis. USFCA Publishing. Zhao, Wang (2010). Application of Blue Ocean Strategy to Chinese 3G Mobile Telecom Industry. Master of Business Administration Thesis. Blekinge Institute. Swedia.

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SUCCESSION PLANNING IN A FAMILY BUSINESS (CV. MANIKAM JAYA PLASTIK) Patrick Goenawan T, 2Trainggoro Wiradinata♠

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Ciputra University, Surabaya Indonesia Emails: [email protected], [email protected]

ABSTRACT In Indonesia there are a lot of family business, whereas when we are talking about family business we won’t be able to miss the word “succession” or “leadership regeneration” in one’s company, which basically means the transfer of responsibility from the founder to the successor of the said company, whereas most of them are because the founder has entered the age of retirement which is no longer productive to rule the company In this study observation will more focused on the succession problems of a family business, in an attempt to improve the succession planning in CV. Manikam Jaya Plastik as well as a valuable input for other family businesses The study will be based on several underlying factors in some other family business which may cause the succession problem, and then bring the opinion of an expert to find the solution of those problems, which then can be made as a solution for the succession of CV. Manikam Jaya Plastik The results of this study indicate the there are needs for : open relationships between the founder and the successors, clear job description, to tell the successor in advance regarding the succession so succession can happen gradually, also there is a need to promote the interest of a successor so that he is more inclined to do succession than pursuing his own dream Keywords : Family Business, Succession Problems, Leadership

INTRODUCTION Businessmen are the core in ones’ country economy. Businessmen have some brilliant ideas to design something which can help/improve the life of many, gaining profit in return. To realize their ideas they need to form a business which later be named as family business The Jakarta Consulting Group (2008) said, according to some research from Backard, Gibb Dyes, 90% of 15 million big companies in America are from family business, a third of 500 rich companies in America are family controlled. 40% GNP or 59% GDP of America are from family run business. From that, we can conclude though not large family business have been the backbone of America’s economy According to the Price Waterhouse Cooper (PwC). More than 95% of companies in Indonesia are family business. According to PwC family business is defined as a company in which the majority of the votes are in the hand of the owner or in the hand of the ones who acquired the business, e.g : wife, siblings, nephew, etc,

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and there’s at least 1 family member must be in the management or administrative position in that company The problem is, succession of those family business from the owner to their next generation is not in their priority list, despite its importance. According to Family Firm Institute untuk jurnal Family Business Review (2008). Only 30% of Indonesia’s family business manage to get to their 2nd generation, and 12% can get to the 3rd generation, only 3% actually managed to get to the 4th generation There are usually problems arise in the family business such as : Determining compensation vs competency, mix emotion between family and professional attitude, structural management, reward/profit distribution In the light of those events, researcher would like to conduct a research to further examine in one’s own family business, CV Manikam Jaya Plastik, a company which involves in plastic flakes supply, whether there is already a succession planning or is it enough. By comparing with other family business we can observe what factors determine the succession planning The main problems that need to be solved in this research is : How is the preparation of succession in a family business. Which will be later used to determine the factors influencing the succession, and further can be used as a good model for CV. Manikam Jaya to plan their succession planning LITERATURE REVIEW A research entitled “Studi Deskriptif Persiapan Suksesi Kepemimpinan Pada Perusahaan Freight and Forwarding” by Hadinugroho & Mustamu (2013). The research involved a freight forwarding company whose owner trained his son to be the general manager of the company in the future. The researcher used 3 steps to measure the succession planning of the companies : pre succession, succession process, and post succession. In pre succession, there are 2 pointers to be observed : successor’s motivation and education/experience level. In succession process the researcher observed more on : responsibilities, the way of thinking, decision making of the successor. Under post succession, the researcher observed the owner’s hope toward the successor and comparing it with the reality. And the conclusion of the research was during pre succession the owner did not thoroughly observe the successors’ qualifications. Moving on to succession process, the transition of knowledge went well, however the successor still needs to learn the importance of employee. The conclusion of this research was, the succession was going well despite being not entirely effective The second research entitled “Analisa Suksesi Kepemimpinan Pada Perusahan Keluarga PT. Fajar Artasari di Sidoarjo” by Halim (2013). This research was focused on the characteristics that need to be had to be a good leader, be it for the successor or the owner of the family business. Also, how the owner passed the leadership knowledge to the successor. The conclusions of the research were : 1) PT. Fajar Artasari used Democracy or Aristocarcy leadership depending on the situation, 2) The leadership tends to be one way going from the owner> leader >going down to the employee, so the subordinates tend to only follow their leader/managers without much thinking, 3) Regarding leadership transfership to the successor PT. Fajar Artasari did a good job The third research entitled “Left in the dark: Family successors’ requirement profiles in the family business succession process” by Schlepphorst dan Moog (2014). The research observed the attributes required of each successor to be qualified to be the successor of the family business, according to the owners’ point of view, successors’ point of view, as well as general point of view. The results were : 1) soft and hard skills are both required in a successor, 2) a lot of owners still has no preparation over their successors, 3) And therefore the successors

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are often left in the dark, questioning what kind of skills/contributions needed to be able to take part in that business From all of the above researches, it can be concluded that there are a lot of factors as well as the way to determine that factors in a preparation to select a family business successor which are often neglected by the owner of the family business. I the light of that even CV. Manikam Jaya Plastik would like to know the factors determining the succession planning based on the view from the successor, owner, and an expert in the family business

RESEARCH METHODS This research was mainly focused on 2 family businesses which helped the researcher to create what onbstacles/problems were mainly found in the family business successions, which were later analyzed and reviewed together with the help of an expert in a family business, and the findings could later be used to create a good succession model for CV. Manikam Jaya Qualitative descriptive research method was used in this research. According to McMillan & Schumacher (2003) qualitative research is usually called investigative research, in which usually the researcher are trying to collect the datas by directly interacting with the informants in the vicinity. Qualitative research can also be called as if the datas found aren’t collected from any kind of statistical results or any form of mathematical calculations ( Strauss & Corbin, 2003) To determine the informants sample, purposive sampling techinique was used. According Notoadmodjo (2010) purposive sampling is the techinque to find a sample based on the predetermined characteristics Data source is primary, in which the datas are directly collected from the infromant without any medium (Sugiyono, 2012) The place and time to interview the 2 informants are during September-October 2016, in their own houses To maintain the credibility of this research, according to Sugiono (2012) there are 6 methods that can be used. In this research 3 of them were be used : 1. Tiangulation • According to Wiersma (Sugiono, 2012), triangulation is to check the crdibility of a research by cross checking the datas with several different people in a different time 2. Using references • Using some evidences to support the credibility of the research, eg : photos, recordings 3. Improving accuracy • By improving the accuracy as well as the quality of the questions that were to be asked to the informants, researcher could then be more careful and selective to choose which answers are more accurate/suitable to answer the question The research were analyzed with the aid of genogram and perception maps. Genogram is a method of analyzing the link between each family member, to determine how closely related one to each other, using genogram the researcher may gather the information about the link between each family members, more imprtantly between the successor and the owner of the business. Perceptual maps is a mapping system to map the strengths and weaknesses of one

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person according to him/herself and according to other people realted to them, and by using the perceptual maps, some info regarding the informants could be generated Results Overview CV. Manikam Jaya A family owned business which has been going in the plastic flakes business for over 10 years and now is having a problem to find a good succession plan. 2 other family businesses were used as benchmark to identify the underlying problems which usually arise in family business Overview Company 1 Involves 2 companies which are owned by 1 owner age 55 years old, and have 2 daughters age 26 and 24. Feature of each company 1. PT. Dwilingga Manunggal Pratama A company which offers a service to store as well as cleaning shipping containers. The prepared successor is the younger sister 2. PT. Prima Integrita Utama A property developer company. The prepared successor is the elder sister Interview conclusion for company 1 The elder and younger sisters, both just participated in the business for less than 6 months. Its therefore thier scope of work is still limited. The elder sister is handling the marketing of properties in the family run property developer company, the job description that can be handled were recruiting staffs, finding places for a marketing event. The younger sister in the other hand is handling the finance in the container storage company, she’s just learning about the company’s finance, following the owner to negotiate and discuss the pricings with a customer or supplier The percieved thought of the owner according to himself is the owner thought that his weaknesses are he’s aging, and as an aging generation he’s not that adaptive to the surroundings technological advances as well as laws, also some connections and partners are aging as well undeniably decreasing over time. Thats whay he thought there’s a need for sucession. For the 2 daughters of his, they are percieved by the owner and themsleves, that the elder sister is more o an ggresive type of business woman, meaning the moves/decission made are fast, but sometimes too reckless and disobeying some rules/guidelines. Meanwhile the younger sister is more of a defensive type of a businesswoman, she’s more afraidto do something, and there must be some clear guidelines/rules to follow in order to move, thus making the decission making slower. In this area the strength and weaknesses of both candidate are still observed to find a suitable positions for them in the business in the future The owner introduced the elder sister to some property agents, taught her to elarn to calculate the pricing of a property, the cost to build a building as a part of learning process. Meanwhile the younger sister was taught about the process of woring in a container storage service company, asked her to follow the owner to various customers, as well as self learning from the existing staffs There are monthly meetings that were occasionally held to discuss the problems in both companies, additionally within family members they often talk internally to solve the problems.

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About the retirement plan, according to Widjajanto (2009), retirement can be devided into 2 meanings, one is retired due to being fired or out ouf job during a productive ages, the other one which was used in the research is the retirement due to olde ages, and the body is no longer productive. In this company, the owner has no retirement plan, however he has a dream to merge all of his company into one big name and then the successors could easily monitor the activities of the company Commitment of the successor. The elder sister loved her job in the company, and pretty determined to continue the family business. The younger sister likes the job just because she has nothing to do at the moment, but prefer other job of her dream in the future Overview Company 2 The owner owns a daily needs store which sell rice, sugars, eggs, etc. The owner has 2 sons, but only the elder brother, is currently raised to be the successor Interview conclusion for company 2 The owner thought he still needs a lot to learn to expand the market of his business, he also thought the successor is too reckless on running the business/making decision. While the successor thought of himself as an indeed a reckless person, he doesnt think for too long to make a decision. The successor perceived the owner as a person who has a vast kowledge within the industry, but the owner has a weakness of having a hard time making changes, and tend to stay in the comfort zone The successor had been in the family business for over than 6 years ago, when he was studying in the college, helping his parent running the shop every once he had a free time. Now he has been assigned a responsibility to manage the shop’s finance as well as selling to the customers The knowledge which was transferred by the owner to the successor was how to differentiate the good over the bad qualitites of rice grains, any otehr things the successor learn by himslef over the course of 6 years. Until now he can independently work by himself, although the owner is still watching and geving advices to him. For the most part, conflict in this company is handled internally within the family/employees, since the business is not too complex The retirement planning of the owner was not planned. Although, he might want to still watching and observing the company run by his successor when he’s already retired The successor has his own business to run in the financial company, however the successor had a thought that its important to preserve the family business which has been going on for 2 generations before him Conclusion by the expert By gaining some defining factors for some problems which usually arise in the 2 family businesses above. The experts have some saying of what could be done right to correct those problems : 1. Owner’s character • They need yo have an open minded thinkings, to allow successors to give their opinion, instead of just following order 2. Perception of owner-successor • They both need to build a good images between each other. Having good realtionship will definetely help toward a good succession planning 3. Job assignment • Job assignment to the successor needs to be specific, starting from the small part of the company, then gradually increase the workload

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4. Decision Making • A successor needs to have their freedom to undertake small problems, and have their own decision with the guide of the owner. They need to have confidence and a chance to prove their ability to the owner 5. Knowledge transfer • Business or practical knowldge should be transferred gradually instead of suddenly. This allows 2 involving parties to be comfortable, and promoting good environment for learning purposes 6. Conflicts in the business • Conflicts in the business should be discussed and handled as soon as possible. Conflicts that can be handled by a successor can create trust from the owner as well as gaining more confidence to handle larger conflicts 7. Retirement planning • Many family business owners especially in eastern countries, dont plan their retirement, unlike its western counterparts. They thought that the business means a pride for themsleves, thus they tend to run the business until their body can no longer work, or at least still observing the company while being run by his successor, they wont let go 100% of their control over the company 8. Successors Comitment • A successor commitment to continue the family business is influenced by their ambition to work outside the family business. An expert says, some people who actually work outside the family business and then choose to have commitment in the family business, tend to be more successful, then the ones who do not have any other job/experience previously outside their family business RESEARCH LIMITATION 1. This research was only done to 2 families only. To be able to generalize the result, reserach should be done to much more families/companies (sample size) 2. Experts’ oppinion are only based on 1 expert only, thus some subjectivity on the information given might be found 3. This research only use some limited parameters to determine the succession’ pattern. In reality there are a lot more paramters to consider to form a truly perfect succesion planning patern CONCLUSION Suggestion/advice for CV. Manikam Jaya 1. There is a need for the successor to be given small tasks first, then increase the workload as it progress 2. There is a need to have an open minded thinking between the owner-the successor 3. There is a need to increase the interest of the successor in the family business, so that the successor is more willing to do succession 4. When there is a need to do succession, succession should be done as early as possible, so the knowledge transfer can be done gradually bit by bit

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REFERENCES Aronoff, C. E., McClure, S. L., & Ward, J. L. (2011).The evolving roles of leader and successor.In Family business succession (2nd ed., p. 61). USA, USA: PalgraveMacmillan Blunden, R., Michael-Tsabari, N., & Algarin, J. O. R. (2013). Analyzing Family Business Cases: Tools and Techniques. Case Research Journal, 33(2). Charista, P. Kisi - kisi Manajemen Bisnis Keluarga. (2016, March 29). Retrieved from http://sisicharista.blogspot.co.id/2016/03/kisi-kisi-manajemen-bisnis-keluarga.html Hadinugroho, E. &Mustamu, R. H. (2013).Studi Kepemimpinan Pada Perusahaan Freight and Forwarding.Agora Vol.1, No. 1 Halim, Y. (2013). Analisa Suksesi Kepemimpinan Pada Perusahaan Keluarga PT. Fajar Artasari di Sidoarjo. Agora Vol. 3, No. 1 How to create a medical genogram - GenoPro. (2016). Retrieved from http://www.genopro.com/genogram/medical/ Joannes, W. (2009). Mengapa ada Phk dan Pensiun Dini? In Phk dan Pensiun Dini (pp. 5-6). Jakarta, Indonesia: Penebar Swadaya. Royer, S., Simons, R., Boyd, B. and Rafferty, A. (2008), Promoting Family: A Contingency Model of Family Business Succession. Family Business Review, 21: 15–30. doi:10.1111/j.1741-6248.2007.00108.x Schlepphorst, Susanne, and Moog, P. (2014). Left in the dark: Family successors’ requirement profiles in the family business succession process. Journal of Family Business Strategy 5.4 (2014): 358-371. Print. Sugiyono.(2012). “Memahami Peneilitan Kualitatif”.Bandung : Alfabeta Supriadi, A. (2014, December 2). PwC: 95 persen perusahaan indonesia adalah bisnis keluarga. Retrieved June 22, 2016, from http://www.cnnindonesia.com/ekonomi/20141202100356-92-15176/pwc-95-persenperusahaan-indonesia-adalah-bisnis-keluarga/ Susanto, A. B., Wijanarko, H., Susanto, P., & Mertosono, S. (2008). The Jakarta Consulting Group (2nd ed.). Jakarta, Indonesia: The Jakarta Consulting Group.

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THE IMPACT OF SERVICE QUALITY AND POSITIVE NEWS OF MASS MEDIA TOWARDS STUDENT SATISFACTION IN UNIVERSITY OF CIPUTRA 1

Winarto Poernomo, 2Denny Bernardus♠

University of Ciputra Surabaya INDONESIA Email: [email protected], [email protected] ABSTRACT University of Ciputra is one of the leading private University in Surabaya, Indonesia providing Entrepreneurship Education as the core curriculum and not only given in certain area of study or major but Entrepreneurship Education acts as the core curriculum for all majors including design, computer technology, psychology, medical, tourism and management major. University of Ciputra as an education institution or service provider acknowledges the importance of understanding and implementing Service Quality to satisfy the students, the purpose of this research is to analyze the relationship between Service Quality and Positive News of Mass Media as independent/predictor variables and Students Satisfaction as dependent/criterion variable, this research is a quantitative research using descriptive statistics and multiple regression. Result of this research can be described as follows: Positive News of Mass Media and Service Quality in term of Reliability contribute significantly to Student’s Satisfaction, while predictors such as Quality of Service in term of Responsiveness, Assurance, Empathy and Tangibles doesn’t contribute significantly to Student’s Satisfaction Keywords: Service quality, Service quality in higher education, Student’s satisfaction, Student’s satisfaction in higher education, Customer’s satisfaction, Customer’s satisfaction in higher education

INTRODUCTION University of Ciputra located in Surabaya, Indonesia is one of the pioneers in delivering Entrepreneurship Education for undergraduate and graduate students. Competing to attract students in a densely competitive university environment in Indonesia, home of 2.408 universities in 2005 and growing to 4.264 universities in 2015 (Dewimerdeka, 2015) University of Ciputra differentiation is Entrepreneurship Education. Located in Surabaya, main competitors of University of Ciputra are private universities that also located in Surabaya, all of the University competitors established for more than 50 years compared to University of Ciputra established 10 years ago, they are University of Surabaya (UBAYA), Petra Christian University (PETRA) and University of Widya Mandala (WIDYA MANDALA), below is the comparison of University of Ciputra number of students compared to the main competitors

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Figure 1 Number of Students Source: http://forlap.dikti.go.id/ To compete with other universities, University of Ciputra needs to understand important factors contributing to their student’s satisfaction during their educative interactions with the university. Teaching process within the university is a form of service/s while learning process is a form of students experience as a customer (Khodayari and Khodayari, 2011). This research elaborates on student satisfaction, a continuing research from Keblawi, Johansson and Svensson (2013) on Kristianstad University using student’s satisfaction as dependent variable, service quality and positive news as independent variables affecting the student’s satisfaction, the research being held after Kristianstad University being published in national newspaper as one of the best university nationally. Achievements of University of Ciputra often being published nationally by newspapers, TV and other mass media so this research will elaborate further the relation between student’s satisfaction, service quality and positive news of mass media

LITERATURE REVIEW Previous Researches Service Quality According to research conducted by Parasuraman, Zeithaml dan Berry (1985) that being refined further more in 1994 into 5 determinants: reliability, responsiveness, assurance, empathy and tangibles.

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Figure 2. Determinants of Perceived Service Source: Parasuraman, Zeithaml, Berry (1985)

Service Quality in Higher Education Noel-Levits dalam Munteanu, Ceobanu , Bobâlcă dan Anton (2010) conclude 11 service quality that are important in higher education derived from Parasuraman, Zeithaml, Berry (1985) for higher education 1. Academic advising and Counseling effectiveness. 2. Campus climate. 3. Campus life. 4. Campus support services. 5. Concern for the individual. 6. Instructional effectiveness. 7. Recruitment and financial aid effectiveness. 8. Registration effectiveness. 9. Campus safety and security. 10. Service excellence. 11. Student Centeredness Servqual: Measuring higher education service quality in Thailand

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According to Yousapronpaiboon (2013), based on his research on 350 respondents to analyze the gap between expectation and reality of service quality showing there are negative coefficients meaning the student’s expectations are not fulfilled thus the quality of services is not fulfilling student’s satisfaction. Based on 5 determinants being used, the most disappointing determinant is tangible (physical facilities, equipment, etc.), other determinants are reliability (the ability to fulfill the promise of service accurately), assurance (staff’s background, reputation and their ability to induce trust of their customers), empathy (care and attention towards customers) and responsiveness (willingness to help customers and to provide services within promised lead of time) The Importance of University Facilities for Student Satisfaction at a Norwegian University According to research conducted by Hanssen dan Solvoll (2015) on the relationship between student’s satisfaction and the facilities within a University, highest score would be the reputation of the university (RE) 0.423, attractiveness of the host city (HC) 0.161, university facilities (UF) 0.134, cost of studying (CS) 0.080 and job prospects (JP) 0.003. Within the University facilities (UF), the quality of social area score the highest 0.274, auditorium 0.177, library 0.143, group work area 0.093, study hall 0.063, and computer access -0.008 doesn’t seem to affect the student’s satisfaction.

Figure 3 The Relationship between the satisfaction model and the facility model Source: Hanssen and Solvoll (2015) An analysis of Customer Satisfaction in a Higher Education Context Based on research conducted by Munteanu, Ceobanu, Bobâlcă dan Anton (2010) to analyze student’s satisfaction gap and the corresponding factors, students with different academic performance have different level of needs, high ranked students have different

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level of needs compared to low ranked students as given below are the 12 satisfaction items for high ranked students and low ranked students Table 1 Top 12 Satisfaction items for high ranked student.

Source: Munteanu, Ceobanu, Bobâlcă & Anton (2010) Table 2 Top 12 Satisfaction items for low ranked student.

Source: Munteanu, Ceobanu, Bobâlcă & Anton (2010) Student Satisfaction in a Higher Education Context Based on research conducted by Keblawi, Johansson dan Svensson (2013) analyzing the student’s satisfaction using 2 determinants service quality and positive news, positive news of mass media showing a higher coefficient compared to service quality (0.310 compared to 0.112) This is a very interesting finding considering that University as service provider commonly believes that service quality determines student’s satisfaction. RESEARCH METHODS This research is a quantitative descriptive to analyze the effect of independent variables of service quality (reliability, responsiveness, assurance, empathy, tangibles) and positive news of mass media towards the dependent variable that is student’s satisfaction. Quantitative research is to describe, explain and predict the trend within respondents using probability, this type of research provides measurement of interaction between the independent and dependent variables

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(Khalid, Hilman dan Kumar, 2012). Descriptive research elaborates on who, what, when, where and how, to predict the percentage of the population with corresponding characteristics (Khalid, Hilman dan Kumar, 2012). Research conducted 2016 within students of University of Ciputra, 121 out of 2.780 total students involved in this research and they are picked randomly to fill the online and paper questionnaires. The data analysis being used is multiple regression analysis using SPSS to test the effect of independent variables towards the dependent variables RESULTS AND DISCUSSION Profile of respondents Variables Gender Male Female Study Program International Business Management Regular Class International Business Management International Class Marketing Communication Accounting Visual Communication Design Interior Architecture Fashion Design business Information and Multimedia Technology Management Information System Psychology Hotel and Tourism Business Culinary Business Magister Manajemen (graduate students) Years of Semester 3 Education Semester 5 Semester 7 Semester 9 Trimester 4 Trimester 5

N 56 65 47

(%) 46 54 38.84

4

3.31

1 13 6 1 4 8 4 7 11 4 11 55

0.83 10.72 4.96 0.83 3.31 6.61 3.31 5.79 9.09 3.31 9.09 46

36 15 4 10 1

30 12 3 8 1

Cronbach’s Coefficient Alpha was used to test the internal reliability of the component variables of all dimensions and SPSS correlation of product moment pearson is being used to test the validity. Multiple regressions using SPSS shows that reliability and positive news of mass media has the highest coefficient Y = 1.284 + 0.396 X1 + 0.137 X2 - 0.023 X3 + 0.045 X4 + 0.023 X5 + 0.180 X6 Y: Student’s satisfaction X1: Reliability X2: Responsiveness X3: Assurance X4: Empathy X5: Tangibility X6: Positive news of mass media

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Further verification conducted based on the research by interviewing 5 key people in student’s organization of University of Ciputra with relevant results and confirm the findings within this research. CONCLUSION 1. Service quality determinant Reliability significantly affecting student’ satisfaction 2. Service quality determinants Responsiveness, Assurance, Empathy, Tangibles not significantly affecting student’s satisfaction 3. Positive news of mass media significantly affecting student’s satisfaction 4. Service quality determinants Reliability, Responsiveness, Assurance, Empathy, Tangibles and Positive news of mass media, in unity significantly affecting student’s satisfaction 5. Limitation of this research rely on R2 37.5% and the research only conducted within students of University of Ciputra which means there are other significant variables affecting the student’s satisfaction and result of this research itself may not apply for other Universities. REFERENCES Aryani, D. dan Rosinta, F. (2010) ‘Pengaruh kualitas layanan terhadap kepuasan pelanggan dalam membentuk loyalitas pelanggan’, Bisnis dan Birokrasi, Jurnal ilmu administrasi dan organisasi 2010, pp. 114-126 Astuti,P. (2013) ‘Pengaruh event marketing terhadap keputusan pembelian produk rokok envio mild’, available at http://repository.upi.edu/2754/6/S_PEM_0802584_Chapter3.pdf (accessed 14 April 2016) Corneliu,M, Ciprian,C, Claudia,B, Oana,A. (2010) ‘An analysis of customer satisfaction in higher education context’, international journal of public sector management, vol 23 issue 2, pp. 124-140 Dewimerdeka, M.K. (2015) ‘Tiap dua hari, satu perguruan tinggi muncul di Indonesia’. Available at: https://m.tempo.co/read/news/2015/06/04/079672015/tiap-dua-hari-satuperguruan-tinggi-muncul-di-indonesia (accessed: 14 april 2016) Forlap.dikti.go.id. (2016) ‘Hasil pencarian program studi Universitas Ciputra’ available at http://forlap.dikti.go.id/prodi/search (diakses 25 April 2016) Ghozali, I, Ratmono, D (2013) ‘Analisis Multivariat dan Ekonometrika, Teori, Konsep, dan Aplikasi dengan Eviews 8’ Hanssen, T.S. dan Solvoll, G. (2015) ‘The importance of university facilities for student satisfaction at a Norwegian University’, Facilities, Vol. 33 Issue. 13/14, pp. 744-759 Hasan, H.F.A. (2008) ‘Service Quality and Student Satisfaction: A Case Study at Private Higher Education Institutions’ available at http://www.ccsenet.org/journal/index.php/ibr/article/viewFile/982/952 (accessed 1 Juli 2016) Jones, T.O. dan Sasser Jr, W.E. (1995) ‘Why Satisfied Customer Defect’, Available at https://hbr.org/1995/11/why-satisfied-customers-defect (accessed: 1 Juli 2016) Johansson, I., Keblawi, A. dan Svensson, D. (2013) ‘Student Satisfaction in a Higher Education context’ Available at http://www.diva-portal.org/smash/get/diva2:656089/fulltext02 (accessed: 1 April 2016) Khalid, K., Hilman, H., Kumar, D. (2012) ‘Get along with quantitative research process’, International Journal of research in management issue 2, Vol 2, pp. 15-29 Khodayari, F. dan Khodayari, B. (2011) ‘Service Quality in Higher Education, case study: Measuring service quality of islamic azad university, Firoozkooh branch’, Interdisclipinary Journal of Research in Business, Vol 1, Issue. 9, pp. 38-46

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Kotler, P., Bowen. J.T. dan Makens. J.C. (2006) ‘Marketing for Hospitality and Tourism Fourth Edition’ Machleit, K.A. dan Mantel, S.P. (1999) ‘Emotional Response and Shopping Satisfaction Moderating Effects of Shopper Attributions’ Journal of Business Research 2001, pp. 97106 Munteanu, C., Ceobanu, C., Bobâlcă, C. dan Anton, O. (2010) ‘An Analysis of Customer Satisfaction in A Higher Education Context’. International Journal of Public Sector Management, Vol. 23 Iss 2, pp. 124-140 Mursito, CE. (2015) ‘Pengaruh B2B influencing factor, perceptual drivers, dan geographical factors terhadap loyalitas konsumen kaca film merk V-Kool’ Universitas Ciputra Nasution,R. (2003) ‘Teknik Sampling’ available at http://library.usu.ac.id/download/fkm/fkmrozaini.pdf (accessed 14 April 2016) Oliver, R.L. (1977) ‘A Cognitive Model of the Antecedents and Consequences of Satisfaction Decisions’ Journal of Marketing Research pre 1986;Nov 1980;17,000004;ProQuest, pp. 460 Parasuraman A, Zeithaml, Valerie A, Berry, Leonard L (1985) ‘A Conceptual Model of Service Quality and its Implications for Future Research’ The Journal of Marketing Vol. 49, No. 4, Autumn 1985, pp. 41-50 Parasuraman A, Zeithaml, Valerie A, Berry, Leonard L (1994) ‘alternative Scales for Measuring Service Quality: A Comparative Asessment Based on Psychometric and Diagnostic Criteria’ Journal of Retailing Vol. 70, Number 3, pp. 201-230 Schramm, W. (1949) ‘The Nature of News’ Journalism Quarterly September 1949, pp. 259-269 Suryosubroto, B (1984) ‘Meningkatkan Daya Guna Pers Sebagai Media Komunikasi Antara Sekolah dan Masyarakat’ Cakrawala Pendidikan No. 12 Volume: iii 1984 Setiawan,N. (2007) ‘Penentuan ukuran sampel memakai rumus Slovin dan tabel KrejcieMorgan: telaah konsep dan aplikasinya’, Available at http://pustaka.unpad.ac.id/wpcontent/uploads/2009/03/penentuan_ukuran_sampel_memakai_rumus_slovin.pdf (accessed 14 April 2016) Siregar, S (2010) ‘Statistika Deskriptif Untuk Penelitian’ Sulistiyono, N.Y. (2013) ‘Gambaran asupan gizi dan aktivitas fisik mahasiswa ilmu keolahragaan’ available at http://repository.upi.edu/203/6/S_PJKR_0802558_CHAPTER%203.pdf (accessed 14 April 2016) Usman, H, Sobari, N (2013) ‘Aplikasi Teknik Multivariate Untuk Riset Pemasaran’ Wijaya (2013) ‘Uji Asumsi Klasik Regresi Linear’ available at https://roelcup.files.wordpress.com/2010/01/22428727-uji-asumsi-regresi.pdf (accessed 20 Juli 2016) Yousapronpaiboon, K. (2013) ‘Servqual Measuring Higher Education Service Quality in Thailand’ Procedia-Social and Behavioral Sciences 116 (2014) 1088-1095

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INNOVATION STRATEGY IMPLEMENTATION IN STEEL MANUFACTURING COMPANY 1

Edwin Yohanes Gunadisastra, 2J. E. Sutanto♠ University of Ciputra Surabaya INDONESIA

Emails: [email protected], [email protected] ABSTRACT The development of the building materials manufacturing industry is experiencing a slowdown that is consistent with the drop in national economic growth rate. Particularly true in the steel-making industry which is impacted by the rapid flow of supplies from abroad making the climate increasingly fierce and competition become red ocean. This study aims to understand the company’s current business model, as well as external conditions and market scanning, and then find the right steps in formulating relevant strategies to bring company into the blue ocean. There are some tools which can be used such as Business Model Canvas, then continued with the Mapping Analyzes of Four Main Areas. Next is the depiction of the Strategy Canvas and The Four Actions Framework. Finally closed by describing a new business model into a new BMC. This research analyzes use descriptive qualitative method, accompanied with collecting data through interviews, participant observation and documents study. The study was conducted in a steel manufacturing company PT. A at Surabaya in the period October 2015 to March 2016. Validity and reliability are performed by using triangulation of data sources, and triangulation of methods. The study concluded there are several aspects that need to be changed. There are eliminated, reduced, enhanced, and even created, in order to change the company’s strategy canvas moving away from bloody competition towards blue ocean that made the competition irrelevant. Keywords: innovation, business model, strategy canvas, business model canvas. INTRODUCTION Just as on PT. A which is a zinc-aluminum coated steel manufacturing company also affected both in terms of sales volume and margins earned. The needs of zinc and aluminum coated steel in the designation of the construction world is one type of material that is widely used. As with other basic materials namely cement. Demand for coated steel are not only met by domestic suppliers, but also from abroad. Annual sales data from PT. A showed an upward trend, but it only happens through fiscal year 2012-2013, which reached the peak tonnage that managed to record sales of 3,946 tonnes. But after that there was a crisis in which the sales trend continues to decline in the next fiscal year that is 3341 tonnes and 2966 tonnes in the next two years as shown in Figure 1.

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Figure 1. Yearly Sales Volume The next thing that is interesting is that not all similar competitor in this area experienced a decrease in sales volume as shown in Table 1. Table 1. Competitor’s Sales Growth Company 2013-2014 [tonnes] 2014-2015 [tonnes] Growth [%] PT. A 3,341 2,966 -11% PT. CBM 1,148 1,420 24% PT. UMW 685 952 39% PT. AS 956 1,329 39% PT. UM 983 1,079 10% PT. MM 1,011 617 -39% PT. KKR 2,028 897 -56% If the views of performance data for the last two fiscal year FY13-14 to FY14-15, which is based on primary data drawn from the data PT. B which is the holding company of PT. A, who also be the sole supplier for one of these types of comparing products, featuring tonnage sales of the seven companies that are closest competitor PT. A one another. As seen that PT. A decreased 11%, and followed by PT. UM and PT. KKR declined quite a lot. But on the other hand, there are four other companies that have been increasing even as the figure is quite good, which up to 39%. Obviously this is very exciting to be examined in more depth. What are the key success factors in the competitors in attempt to increase the number of sales, as well as what are the factors that contributed to the decline in the number of sales of other companies. Seeing these phenomenas that occur at the top, it can describe the possibility that the company was in the red ocean of competition. A book called Blue Ocean Strategy by Kim and Mauborgne (2005) describes some characteristics of a red ocean, namely: (1) competing in a market space that already exists, (2) fighting to win the competition, (3) exploit the demand, (4) choosing between the value or cost or also called the value-cost trade-offs, and (5) integrate the entire system of activities of the company to conduct a strategic choice of differentiation or low cost. In the conditions of that a company should start switching to a more spacious room, which can move more freely move and not crowded as competing until the bleeding, but to a still blue ocean. The characteristics of the strategy blue ocean are: (1) creating an uncontested market space, (2) make the competition irrelevant, (3) create and capture new demand, (4) breaking the exchange of value-costs, (5) integrate overall system of corporate activities in pursuit of differentiation

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and low cost. Moreover added by Porter (1998), that the company can be competitive with how to navigate and find a new path and to better compete in the industry and bring it to the market which is a form of innovation that is most essential. LITERATURE REVIEW Business Model Canvas According to Osterwalder and Pigneur (2010), a business model describes the rationale of how an organization creates, delivers, and captures value. The business model is like the blueprints of a strategy adopted by the organizational structure, processes and systems. Therefore, it needs a framework called Business Model Canvas (BMC), which is a quick tool of a picture of a business model that was created and written by Osterwalder and Pigneur (2010) in his book.

Figure 2. Business Model Canvas There are nine aspect components in BMC, which includes Customer Segments, Value propositions, Channels, Customer Relationships, Revenue Streams, Key Resources, Key Activities, Key Partnerships, Cost Structure. Four Main Points Mapping Innovation begins with the process of exploitation, both external and internal. Innovation is the new ideas were successfully exploited, including the creation of something new, or a combination of desires and needs of customers (Alamsjah et al., 2010). Meanwhile, in a process of creation of innovation there are three levels: (1) incremental innovations (small changes based on the knowledge and capabilities), (2) modular innovations (changes more than just the simply development of products, (3) radical innovations or changes to take advantage of opportunities that are not thought of before that can influence the manufacturing process, sales, and so forth (Andriopoulos and Dawson, 2011). The exploitation process is not separated from understanding the business models that exist today. Business models designed and executed in a specific environment. Develop a good understanding of the organization's business environment helps companies get the business model stronger and more competitive. Continuous environmental scanning is more important than ever because (1) the economic landscape is increasingly complex (eg business model networks), (2) the higher the uncertainty (eg technological innovation), and (3) damage severe market (eg economic turmoil , the proportion of new value destructive). By understanding the

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changes in the environment to help companies adapt more effectively to shifting external forces. Understanding the external environment as a kind of "design space", as a context to adapt the business model by considering a number of trigger design.

Figure 3. Four Main Points Mapping Strategy Canvas There is a work tool more well known strategy canvas, as it was first introduced by Kim and Mauborgne (2005). The strategy canvas is a diagnosis action framework to build a good blue ocean strategy. Canvas strategy has two functions. First, it summarizes the current situation in the known market space. This allows us to understand where the competition is currently being shed, to understand what factors are being used as competition in products, services, and delivery, and to understand what the consumer obtained from existing competitive offerings in the market. All information is summarized in graphical form. The horizontal axis represents a range of factors were used as competition and investment by the industry. The vertical axis obtained summarizes the level of supply buyers in all major factors of the competition. High score indicates a company offers more to consumers, while indicating the company is to invest more in these factors. In the case of price, a higher score indicates a higher price. Four Actions Framework and Scheme E-R-R-C By Kim and Mauborgne (2005) also described the next action steps to reconstruct buyer value elements to create a new value curve, which is called the four actions framework. Then the next step is to encourage companies to not only ask four questions in the four actions framework, but also acting on all four questions was to create a new value curve.

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Figure 4. Four Actions Framework RESEARCH METHODS In this study the authors chose the type of descriptive and qualitative research methodologies by way of inductive approach to find answers to questions of this research problem formulation. Or also called a model case study. Model case studies according to Creswell (1998) is a model that emphasizes the exploration of a system that is bounded (bounded system), along with in-depth data mining that involves a variety of resources that are rich in context. Added by Bungin (2011) that the qualitative descriptive format is generally carried on research in the form of case studies. According to Creswell (1998) there are eight reasons to use the type of qualitative methodology, in which the first reason is to answer the question "how" and "what", and where this is in line with what the author said in the formulation of the problem of this research. According Moleong (2005), qualitative research is research that aims to understand the phenomenon of what is experienced by the subject of research in a specific context in which the natural holistically and by way of description. It was also mentioned by Bungin (2011) that the incorporation of qualitative descriptive format is theorizing the most widely used in qualitative research. Next is the approach by way of inductive. Thus, the descriptive qualitative method with inductive approach can be used in research that require more study to find the facts and then examined for general conclusions can be drawn. Data Types and Sources According Sugiyono (2014), the data source can be divided into two primary and secondary. The following data sources were used in this study: 1. Primary The primary data source is a source that directly provide data to data collectors. Primary sources used include interviews with company leaders, the head of the marketing department, production, and also the customers. It also made observations in the field and collect data in the form of notes on the situation and events in the field.

2. Secondary A secondary source is a source that does not directly provide data to data collectors, for example through the document. A secondary source is obtained from the record sales

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reports, performance reports to the ministry. In addition, it is used also book study literature related to this research. Data Collecting In qualitative research known several methods of data collection are commonly used. According Herdiansyah (2010) some of these methods include interviews, observation, documentation and other studies, but this time the author uses three methods already mentioned. 1. Semi-structured interviews According to Stewart and Cash (2008) definition of the interview is a conversation because of an exchange or sharing of roles, responsibilities, feelings, beliefs, motivation, and information, interactive occurring more than one person. In general interviews in qualitative research interviews or more of three forms, namely structured interviews, semi-structured, and unstructured (Herdiansyah, 2010). However, the authors chose semi-structured interview method in which more appropriate where it has set up an open question but there are limitations which answers more free themes put forward by the subject does not come out all the context of discussion. Is flexible yet controlled. Resource persons who will be interviewed six people which of the company's internal area is general manager of eastern Indonesia (GM). The next guest speaker is on the side of the company's customers include the directors of the company distributor PT. X (DX), and also distributor CV. Y (DY), where the two companies have been registered as official distributor of PT. A for more than 10 years, plus other customers. As explained earlier, if one distribution channel that is owned by PT. A is a distributor, so we can say that the distributor is a part of the company's customer PT. A. 2. Participant observer According Bungin (2011) there are three types of observations include participant observation, observation is not structured, and unstructured observation group. In this study used participatory observation as data collection is done through direct observation, is the object of observation in daily activities.

3. Study documentation The study documentation is one of the methods of qualitative data collection by viewing or analyzing the documents created by the subject himself or others on the subject (Herdiansyah, 2010). The types of documents that can be examined in this study the official documents both from internal and external such as newspapers, magazines, and so on (Moleong, 2005). Research Instruments Resource persons who will be interviewed six people which of the company's internal area is general manager of eastern Indonesia (GM). The next guest speaker is both the director of the distributor company PT. X (DX), and also distributor CV. Y (DY), and three other customers of the company's different customers. (DA, DB, DC).

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No

Table 2. Interview Guide About Company’s Current Condition Questions Interviewees

1

How is today’s consumer segmentation?

GM

2

What products/services does company offer?

GM

3

How does company reach its consumer?

GM

4

What kind of relationship has been built with consumer?

GM

5

What are the sources of income of the company?

GM

6

What resources are owned by the company?

GM

7

What is the key activities of the company?

GM

8

Who are the partners?

GM

9

How is the cost structure?

GM

No 1

2

3

4

5

No 1

Table 3. Interview Guide About Strength of The Market Questions Interviewees What important issues affecting the customer landscape? DX, DY, What is shifting? DA, DB, DC Where the market is heading? Which segment is the most important? DX, DY, Where is the biggest potential growth? DA, DB, DC Which segments are declining? What does consumer need? DX, DY, What are unsatisfied consumer’s need? DA, DB, DC What does consumer really want to finish? Where are the declines and inclines laying? What makes a customer is tied to a company and its offer? DX, DY, What does it cost to prevent customer from being switched to a DA, DB, DC competitor? Is it easy for costumer to find a substitution offer? How important the brand is for customer? What really make customers want to pay? DX, DY, Where is the biggest margin can be achieved? DA, DB, DC

Table 4. Interview Guide About Strength of The Industry Questions Interviewees Who are the competitors? DX, DY, Who are the dominants in our sectors? DA, DB, DC What are their strengths and weaknesses? Which segments are they focusing on? How is their company’s cost structure?

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2

3

How big are their impacts to our revenue streams, margin? Who are the new comers? How do they differ? What are their competitivenesses? What obstacles do they face? What are the value propositions? Which customer segments are they focusing on? How are their cost compared to our cost?

DX, DY, DA, DB, DC

4

Who are the key players in our value chain? How dependent is our model business to other key players?

DX, DY, DA, DB, DC DX, DY, DA, DB, DC

5

Which stakeholder could affect our business model? How big is the impact?

DX, DY, DA, DB, DC

Table 5. Interview Guide About Key Trends No 1

2

3 4

No 1 2

Questions What are the technology trends that are strong inside and outside of our market? Which technologies are showing important opportunities or destructive threats? Which new technologies are possibly absorbed by the market? Which trend of regulations are affecting the market? Which regulations are affecting our business model?

Interviewees DX, DY, DA, DB, DC

What kind of shifting cultures or social values that affect our business model? How is main demograhpy trend?

DX, DY, DA, DB, DC DX, DY, DA, DB, DC

DX, DY, DA, DB, DC

Table 6. Interview Guide About Strategy Canvas and Scheme E-R-R-C Questions Interviewees Which factors of competitiveness are being compared amongst DX, DY, suppliers? DA, DB, DC What are the score for each factors mentioned in question number DX, DY, 1? DA, DB, DC

Limitations Based on the literature review Research singer Yang was appointed hearts are Many kinds of analysis What can be done and if done Become Too Broad Blanket. Then in the hearts Research singer given Limitations ie NOT reviewing several studies Field Mapping Analysis The hearts are four in the Top Field Covering Macroeconomic strength. Time and Place The study was conducted within 6 months starting from October 2015 until March 2016, located in the city of Surabaya.

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Validity and Reliability Tests In the reliability and validity of scientific research into an absolute thing that must be achieved. Neuman (2000) in Herdiansyah (2010) defines reliability is the consistency that has the same results when repeated or recur in conditions that are very similar or identical. While in the same book, validitias interpreted as honesty, and authenticity. To achieve this, then in Moleong (2005) built the validity of testing techniques that examination technique. According Herdiansyah (2010) triangulation is the use of two or more sources to get the whole picture of a phenomenon to be studied. Mechanical inspection chosen in this study is the triangulation of data sources and triangulation methods. Triangulation of data sources is to compare the current state and perspective of someone with different opinions and views of others. The data sources were interviewed and observed several people as customers of the various stages of the type of companies based distribution channel to the end user, the company employees subject to several levels kesenioritasan. Triangulation method is to check the similarity of the results obtained from a variety of data collection methods such as interviews, observation, and documentation. FINDINGS Analysis of Business Model Canvas and Four Main Points Mapping PT. A is a company which is manufacturing steel products ready for the purposes of the construction industry which has been established in Indonesia since 1973. It is a subsidiary of the group company based in Australia. PT. A is one of the pioneers in this field who is now widely known Indonesian society. There are nine components to be analyzed are: (1) customer segments, (2) value prepositions, (3) channels, (4) customer relationships, (5) revenue streams, (6) key resources, (7) of key activities, ( 8) key partnerships, and (9) cost structure.

Figure 5. BMC of PT. A Based on interviews, observation and documentation, it can be seen what are the strengths, weaknesses, opportunities and threats for the company. These points, among others: 1. Strengths a. High precision profiles b. Quality management system ISO 9001:2008 c. Awareness level 4 (DuPont Bradley Curve) d. Value engineering e. Wide product variances

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f. Business-to-business networking g. Customer relationship management 2. Weaknesses a. Not having high-rib profile b. Not having stainless steel product c. Dependent to third factor in term of installation services d. Low capacity of roll on site e. Financing inflexibility f. High cost vendors 3. Opportunities a. High-rib market growth 95% b. Supply and install c. Stainless steel product demand is increasing d. Roll on site is becoming trend e. High growth in iconic building 4. Threats a. Aggressive competitor’s pricing scheme b. Regulation of product and service procurements c. Subsitute products Analysis of Strategy Canvas The results of whole analysis that is including interviews, and surveys, observations and document studies, it is obtained several factors which are being compared in competition. These factors are as follow: (1) price, (2) decking Sales, (3) showroom and dealership retail, (4) Product Variations, (5) stock contingency, (6) the quality of products, (7) Management Relations, (8) EPC.

Figure 6. Existing Strategy Canvas Analysis of Four Actions Framework and Scheme E-R-R-C Berdasarkan analisan kerangka kerja empat langkah sebelumnya, dapat dibentuk skema hapuskan-kurangi-tingkatkan-ciptakan sebagai berikut.

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Based on the analysis of four actions framework, can be formed the scheme erase-reduce-raisecreate as follows. Erase Raise Decking sales Quality Showroom CRM EPC Reduce Create Product variance High-rib Contigency stock Stainless steel >=0.75 mm Figure 7. Scheme E-R-R-C Based on scheme E-R-R-C above it can set up a new strategy canvas as in Figure 8. A unique value creation curve and open blue ocean. As indicated in the new strategy canvas, PT. A does not spread its operations into all the major factor in the competition. Shaping curve away from competitors PT. UMW and the average of other players. This is a result of the search and view the alternatives and instead of comparing with competitors. Thus PT. A will be in the level of competition is different from before, make the competition irrelevant.

Figure 8. New Strategy Canvas By combining the new strategy canvas with a business model PT. A previous, then obtained a new business model as in the following BMC

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Figure 9 MANAGERIAL IMPLICATIONS The following managerial implications on the company before and after implementing innovation strategies have suggested a new strategy based on the canvas. Table 7. Managerial Implications Work Plan Cost Budgetting Pricing • N/A • N/A Decking sales • Eliminate decking sales • Decking machine (+) IDR 1.89 B. Capex IDR 2.7 B (depreciation into IDR 0 after 10 years) Showroom • Eliminasi showroom • Rent cost (+) IDR 120 M/year • Pengurangan karyawan • Lay off (+) IDR 5 M x 4 persons = IDR 20 M/month Product Variances • Eliminate bolted round rib • Machine (+) IDR 100 M • Eliminate bolted V rib • Machine (+) IDR 100 M • Eliminate bolted 1035 • Machine (+) IDR 100 M Contigency Stock • Limit stock to maximum 5% • Depreciation saving (+) IDR 168 M/year Quality • Recuruit quality control • QC Supervisor (-) Rp 8 supervisor 1 person M/month CRM • Customer loyalty program • Budget IDR 200 M/year • Add KAM to 15 • N/A Engineering, • Value Engineering • Recruit additional technical Procurement, improvement engineer (-) IDR 5 M/month x Construction 2 persons = IDR 10 M/month

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• Adding production team shift 2 • Third party worker routine training • Adding project service team High-rib Profiles SS Product Roll >=0.75 mm

• Machine High-Rib • Machine roll stainless steel • Machine roll >=0.75 mm

• Recruit manufacture worker () IDR 3 M x 6 persons = IDR 18 M/month • Budget (-) IDR 30 m/semester • Recruit 1 officer (-) IDR 7 M/month • Machine (-) IDR 3.375 B • Machine (-) IDR 3.375 B • Machine (-) IDR 3.375 B

CONCLUSION AND SUGGESTION This study aims to find an innovation strategy that is suitable to be applied to the plastic manufacturing company PT. A. The data was collected through interviews with the six respondents from different companies (GM principal, director of distribution channels, Project Manager, Technical Director, Procurement Manager). The researcher also participatory observation and documentation. From the results of data analysis using descriptive qualitative research method, it can be concluded as follows: 1. Based on the analysis of BMC, the company's current business model shows focus on product leadership, the value proposisition. As for the power points are: (1) highprecision profile, (2) quality management system ISO 9001: 2008, (3) value engineering, (4) product variances, (5) B2B network. Meanwhile some weak points are: (1) do not have high-rib machine, stainless steel, (2) dependence on third parties in terms of installation, (3) a payment system that is less soft, (4) high cost vendor supplier. 2. Based on the analysis of four main points mapping, obtained a picture of the external environment such as: (1) rapidly growing of high-rib, (2) increasing demand trends in installation services, (3) SS product market demand increases, (4) the trend of roll on site increases, (5) the more creative and complex architectural, (6) the more aggressive price competition, (7) the growth of substitutive products. Suggestion for Company Management Results of the study showed that in fact the company has had a number of basic capital are as good as the quality management system ISO 9001: 2008, brand awareness inherent in the perception of a premium product with guaranteed quality. But hand in addition to product leadership, namely customer intimacy and operational excellence, there are many things that need to be developed such as quality control, relationship management, value engineering, installation and construction, after-sales service. While there are some things that need to be reduced as contingency stock, the number of product variations in order to pursue the company's operational excellence. Not in spite of some less product to sell, as well as facilities such as showroom showroom sales should be eliminated in order to reduce costs, and replaced with more productive machines. There are three kinds of products that look attractive to current and future market that is the high-rib, SS, and thickness> = 0.75 mm. With the marketing team owned by the company, in addition to the aforementioned, the company can make more comprehensive business plan in implementing innovation strategies will be run, including cash flow projections for the next five years. Companies are also advised to perform an evaluation of the implementation of this innovation strategy on a regular basis in certain periods. It is useful to know how big an innovation strategy that is run a positive impact for the company's growth. For the future, the company sued always nimble and continue to

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develop innovative strategies and agile and swift in decision making in the face of global competition era increasingly dynamic. Suggestion for Future Research In this study, it demonstrated financial statements and the old strategy canvas and canvas of the new strategy. Therefore, for further research is expected to make a projection of a new financial statement which refers to the canvas of the new strategy. Thus appears with detail differences in EBIT performance is expected to be reached in the future. The other thing that needs to be examined in more depth is the pricing strategy. Seeing that the pricing scheme to be one of the factors considered in the competition customers. The purpose of this study was to obtain a blue ocean and leave the bloody red ocean, thus pricing scheme will still be an important topic for analysis. REFERENCES Alamsjah, et al., (2010) Indonesian Business Cases: From Innovation to Financial Excellence. Jakarta: Salemba Empat. Andriopoulos, C. dan Dawson, P. (2011) Managing Change, Creativity and Innovation. London, England: SAGE Publications, Ltd. Bungin, B. (2011) Penelitian Kualitatif: Komunikasi, Ekonomi, Kebijakan Publik, dan Ilmu Sosial Lainnya. Jakarta: Kencana Predana Media Group. Creswell, J.W. (1998) Qualitative Inquiry and Researh Design Choosing Among Five Traditions. Thousand Oaks, California: SAGE Publications, Inc. Herdiansyah, H. (2010) Metodologi Penelitian Kualitatif untuk Ilmu-ilmu Sosial. Jakarta: Salemba Humanika. Kim, W.C. dan Mauborgne, R. (2005) Blue Ocean Strategy. Boston: Harvard Business School Publishing Corporation. Moleong, L.J. (2005) Metodologi Penelitian Kualitatif: Edisi Revisi. Bandung: PT. Remaja Rosdakarya. Osterwalder, A. dan Pigneur, Y. (2010) Business Model Generation. Hoboken, New Jersey: John Wiley & Sons, Inc. Porter, M.E. (1998) Competitive Advantage: Creating and Sustaining Superior Performance. New York: Simon & Schuster, Inc. Sugiyono (2014) Metode Penelitian Pendidikan Pendekatan Kuantitatif, Kualitatif, dan R&D. Bandung: Alfabeta. Stewart, C.J. dan Cash, W.B. (2008) Interviewing, Principles and Practices: 12th Edition. New York: McGraw-Hill Education.

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THE DELAYS FACTORS OF HOUSING PROJECTS FROM THE LICENSING MANAGEMENT ASPECTS POINT OF VIEW 1

Juneita Titing Senewe , 2David Sukardi Kodrat♠ University of Ciputra Surabaya INDONESIA

ABSTRACT The purpose of this study is to determine the factors of housing projects delays on PT X, North Sulawesi. This study applied mix methodology that consists of quantitative and qualitative approach. The study conveyed that: (1) architect licensing is the delay factor of housing projects by contribution about 0,295; (2) technical licensing is the delay factor of housing projects by contribution about 0,489; (3) contractor licensing is the delay factor of housing projects by contribution about 0,388; (4) bureaucracy is the delay factor of housing projects by contribution about 0,443; (5) internal is the delay factor of housing projects by contribution about 0,384; (6) human resource is the delay factor of housing projects by contribution about 0,668; (7) financial is the delay factor of housing projects by contribution about 0,421. Based on the result of the study it can be revealed that architect licensing have the lowest contribution to the delay factor of housing projects. However, the human resource is the delay factor with the highest contribution on it. Keywords: Project Delay, Housing, Project Management, Licensing Aspect.

INTRODUCTION Housing is one of basic needs for people in promoting human life quality (Wignyosoebroto, 2005:108), because housing is the primary needs for people instead of clothing and food. Therefore, whenever, people will need it. Based on data from Central Bureau of Statistics, it can be revealed that next 20 years the needs of housing of Indonesian people will reach 31 million units, in which 18.4 millions units of housing are in urban and 12.5 millions units are in rural (Okezone, 2014). The increasing of housing need for people is the opportunity for housing business. Based on the statement of Director President of PT American Standar Indonesia-LIXIL Corporation, Indonesian property market will increase for about 20% every year significantly. This is potential prospect for future property business in Indonesia. Factors that influence this prospect are the growth of population and the need of housing for middle class people that for about 800 hundred each year (Tempo, 2013). The increasing of housing need and demand, then, influence the price of housing in Indonesia. Based on the survey from Bank of Indonesia, the price of housing in is the highest if compared from the price of housing in other cities in Indonesia. The growth of housing price in is for about 9,7o% per quarter (Komentar, 2014; Jawa Pos, 2014). This growth have occured since five years ago and is affected by the economic growth of , the security stability, and the cheaper land price. This opportunity is taken by developer in to establish the property business, especially in housing projects development in North Sulawesi. One of them is PT X, that had handled housing projects and any construction projects in . Yet, most problems that faced by PT X is

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related to project licensing in which finally influence the project process and establishment. Actually, PT X has been practiced project licensing management to anticipate it. But there are some factors that influence the project delay. Project delay itself may be caused by any factors, such as the owner (Kamaruzzaman, 2012:179). Beside that, Labombang (2011:41) mentioned several factors that influence project delay, i.e: a) the failure in finishing project that suitable to the planned design and time; b) the failure in taking the planning description, planning detail, and available time; c) unpredictable land condition; d) bad weather; e) labour strike; f) the price of material and labur that raised unpredictably; g) work accident; h) the damage that is caused by bad work structure; i) unpredictable condition such as flood and earthquake; j) claims from contractor because of loss and costs due to project delay that caused by design details from designers is also overdue; and k) the failure of project finishing as determined budget. In the development of housing project, the planning activities is completed gradually in any dozens years. Practically, the licensing handling is started before the construction activities begun, because developer commonly has had operation and work schedule (Salim, 2010:246). Theoretically, project licensing management is project management that includes all activities related to housing establishment, such as preparing and arranging work schedule, contract, all licensing related to housing project, report, and sponsorship (Writer, 2008:137). Shortly, licensing handling is not always can be handled well, therefore it will influence the project delay (Lanagan and Norman, quoted Labombang, 2011:41). Licensing, actually is the agreement of authority based on law and government regulation. It is regarded as the administration legal in one angle which is applied law factually based on conditions and procedures that have been determined in the applied law. The licensing in housing project consists of many types of license, but the final license is Building Permit (Izin Mendirikan Bangunan –IMB). Based on the previous study that had been conducted by Kurniawan & Ernawati (2013), revealed that in order to get an IMB, there are many obstacles that must be faced, such as obstacles related to officers skill and ability, avalable facilities, and personal adequacy. They, finally caused the delay of IMB services and issuance, in which are indicated as the factors that influence housing project delay. The Objectives of the Study The objectives of this study are: 1. To analyze that the architect licensing is the factor of housing projects licensing delay. 2. To analyze that the technical licensing is the factor of housing projects licensing delay. 3. To analyze that the contractor licensing is the factor of housing projects licensing delay. 4. To analyze that the bureaucracy function is the factor of housing projects licensing delay. 5. To analyze that the internal function is the factor of housing projects licensing delay. 6. To analyze that the human resource is the factor of housing projects licensing delay. 7. To analyze that the financial factor is the factor of housing projects licensing delay. LITERATURE REVIEW Housing Project Management Project management is understood as an activities of planning, organizing, directing and controlling the company's resources to achieve short-term goals that have been determined. Project management is indispensable in controlling the implementation of a project because it involves a wide variety of resources, requires expertise and skills, and influenced by the environment and natural factors, where all these things must be properly managed to ensure the targets achievement of the project (Malik, 2010: 165). Project management is done in three general phases, namely (Prasetya, 2009: 31): 1. Planning; a phase that includes goals, defining the project and team organization.

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2. Scheduling; a phase that connects people, money and materials for specific activities as well as linking individual activities with one another. 3. Control; a phase in which companies conduct oversight of resources, cost, quality and budget. In phase control, the company also revised or changed plans and shifting or re manage resources in order to meet the needs of time and cost. Related with this research topic, the stages in the management of housing projects, namely: (a) formulate a job description of each of the parties in the organizational structure of project management; (b) formulate a shopping budgeting plan including resource requirements in the form of labor, materials, money, and building area; (c) formulate timetable of each activity and the overall activities of the project with more attention to each track; (d) establish the level of quantity, quality, time and cost to be achieved based on the capabilities of the technology and control techniques; (e) formulate the cost of each activity and overall project; (f) formulate an effort to maximize the quantity, quality, time and cost; and (g) measure and evaluate the work of the project and then predict the future performance (Risza, 2010: 178). Licensing Management of Housing Project Company’s licensing management project is a project management that covers all activities of the housing projects, ranging from preparation to planning of work schedules, contracts, all kind of licensing concerning the housing project, reports and sponsorship (Writer, 2008: 137). Licensing management of housing projects functions are controlled in several ways, namely (Sadyohutomo, 2008): a. Architect licensing Housing design made by architects need to be consulted to obtain the approval from the design team and the officials of the competent authorities in licensing (urban planning) (Sulastomo, 2000: 119). b. Technical licensing Technical licensing typically issued by technical agencies and government or association that serves as an agency or institution that consults the building construction business entity, which must be met for a company to be able to take part in the auction, especially on government projects (Malik, 2010: 57). c. Contractors licensing Contractor is the party that entrusted with the task to carry out development projects by the owner through the auction procedure. The work that performed by the contractor is carried out in accordance with the contract or work plans and terms as well as pictures of work at a cost that has been agreed upon. d. Bureaucratic functions Bureaucracy licensing is the backbone of the public service that should give the best, most effective, efficient and inexpensive practices on serving the public (Akhmaddhian, 2012). Thus, the Licensing Agency should have a simple structure, a task force that is solid and not fragmented, have clear rules on the rights and obligations of users and providers of services and to be able to develop a culture of caring and prioritize the interests of users as citizens with dignity (Dwiyanto, 2011). e. Internal functions Internal factors that influences the licensing rooted in the parties that handle these licenses, among others, political commitment, education, expertise, information or insight, education, income, organizational skills, expertise, and hierarchical control systems (Korompis et.al., 2013). f. Human Resources Required the availability of the appropriate personnel with the relevant competencies and skills in order to fulfill the given job properly (Wibawa, 2006: 84).

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g. Finance Required the design of financing and control of the implementation of the project to be able to meet the design fees have been set at the beginning, so that the efficiency, effectiveness of time, quality and cost can be achieved (Helmi, 2011: 143). Delays of Housing Project Delays of the project is a condition in which there is overtime in the implementation of the project that has been planned and stated in the contract, which can be caused by a deficiency from the contractor or the owner side (Kamaruzzaman, 2012: 179), or it can also be caused due to an error in estimating the time required to complete the project (Ismael, 2013: 47). Housing project delays will cause various loss or impacts to various parties, namely the contractor, the consultant and the owner (Kamaruzzaman, 2012: 180). Specifically, the housing project delays can be caused by several factors as follows (Ismael, 2013: 49): 1. Expertise and resources that are not sufficient to carry out the design specifications 2. Make changes to the design 3. Quality of material that is not in accordance with specifications 4. The increase in the price of building materials 5. Metarial used is less than the amount required 6. The buildup of material on the project site 7. Inaccuracy on booking materials time 8. Lack of construction materials 9. Placing less experienced workers in the field 10. The number of workers who are less skilled 11. Use of unskilled labor in the field 12. Lack of manpower 13. The quality of the equipment used is not good 14. The tools used are not in accordance with specifications 15. The amount of equipment is less than required 16. Broken tool 17. The implementation is not the same with the plan Project delays can be solved using multiple attempts, among others (Ismael, 2013: 54): reducing improper operation method, make changes to design, evaluate the implementator of the plan, using skilled labor, and provide the materials needed in the project. Based on the literature review above, the conceptual and thinking framework for this study can be illustrated as the Figure 1 and Figure 2.

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Research Background: There is a delay on housing project licensing at PT.X

Research Questions: whether architect licensing, technical licensing, contractors licensing, bureaucratic functions, internal functions, human factors, and finances are the determinants of housing projects licensing delays?

Previous Research: 1. Amalia et.al.,(2012). 2. Messah et.al. (2013). 3. Azhari et.al. (2014). 4. Kamaruzzaman (2012). 5. Tjakra dan Sangari (2011).

Literature Review: 1. Project Management (Malik, 2010:165). 2. Housing Project Licensing. 3. Delays of the project.

Hypothesis

Mixed Method Data Analysis: sequential explanatory

Quantitative method

Factor analysis

Quantitative data collection

Qualitative method

Qualitative data collection

Qualitative data analysis

Result and Conclusion

Figure 1. Thinking Framework

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When creating planning description of all projects that will be established, it must handle the licensing first.

The determination of housing architecture that will be built is a must and gives impact on licensing handling.

It is necessary to handle a specific technical licensing to complete the requirement of proposal of housing project licensing. There are obstacles in housing licensing when the specific licensing that related to building business can not be fulfilled by developer.

Architect Licensing X1

Technical Licensing X2

The making of contract as the statement that the project will be established is appropriated to the work plan.

Fullfilling the requirement of licensing process, that is the work plan, requirements, work images, and project costs and expenses.

Bureaucracy services in housing projects licensing has not been efficient and effective.

Contractor Licensing X3

Bureaucracy X4

Bureaucracy functions in housing projects licensing process is complicated and confusing. The changes of leader/district head in bureaucracy internal function slacken the housing licensing process. The internal function of licensing services is full of uncertainty and untransparent. The performance of human resources in institutions that handle housing licensing is not professional and not responsible.

Delays factors of housing projects Y Internal Function X5

Human Resource X6

The officers who handle the housing licensing is not responsive, therefore it influences the time in icensing process and progress. The uncertainty and untransparent process that related to costs of housing project licensing handling. It is difficult to determine the financial planning related to licensing budget, because of the uncertainty and untransparent.

Figure 2. Conceptual Framework

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Research Hypothesis Based on the background and the formulation of the problem posed in this study and the previous study presented above, then the hypothesis proposed in this research are as follows: H1: Architects licensing factors are the determining factors of housing project licensing delay H2: Technical licensing factor is the determining factor of housing project licensing delay. H3: Contractors licensing factor are the determining factors of housing project licensing delay. H4: Bureaucratic functions factors are the determining factors of housing project licensing delay. H5: Internal functions factors are the determining factors of housing project licensing delay. H6: Human resources factor is the determining factors of housing project licensing delay. H7: Financial factors are the determining factors of the housing project licensing delay. RESEARCH METHODS This study applied mix methodology in which implemented two types of research approaches, they are qualitative and quantitative. Total sample that were supported this study are 38 which consists of 37 members of association of Indonesian Property Developers (Asosiasi Developer Properti Indonesia – ADPI) and an employee from PT X. The instrumen of this study is questionnaires that were spreaded to 36 members of ADPI and interwiew guide that objected to one member of DPI and an employee of PT X. Licensing factors influence housing project delay in this study were measured by seven factors, they are architect licensing, technical licensing, contractor licensing, bureaucracy functions, internal function, human resource, and financial function. Data that were collected by spreading questionnaires then processed by applyig confiamtory factor analysis (CFA) in wich supported by software GeSCA. Discussion The major of respondents of this study are male (75%) by age 36-45 years old (55,6%), and have been being experienced as developer for 2-5 years (41,7%0) (as seen on Table 1). Table 1. The Respondents’ Characteristics No Identitas responden Frekuensi Persentase 1 Gender Male 27 75 % Female 9 25 % 36 100 % Total 2 Age 25 – 35 years old 9 25 % 36 – 45 years old 20 55,6 % > 45 years old 7 19,4 % 36 100 % Total 3 Length of working time < 1 years 12 33,3 % 2 – 5 years 15 41,7 % 6 - 10 years 8 22,2 % >10 years 1 2,8 % 36 100 % Total Source: Primary Data Confirmatory factor analysis that was conducted to examine the delay factor of housing projects conveyed that the seven factors which are caused project delay consists of architect licensing, technical licensing, contractor licensing, bureaucracy functions, internal function, human resource, and financial function. All of them significantly contribute to the housing

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project delay, in which the highest contribution is human resource (X6), then followed by technical licensing (X2), bureaucracy (X4), financial (X7), contractor (X3), internal function (X5), and architect licensing (X1). For detail, it can be shown in Table 2. Table 2. Confirmatory Factor Analysis of Licensing Factors that Caused Housing Project Delay Latent Variable Indicator Estimate SE CR Result X1 X2 X3 X4 X5 X6 X7

X11

0.936

0.033

28.52*

Significant

X12

0.962

0.022

43.48*

Significant

*

Significant

X21

0.922

0.033

27.53

X22

0.927

0.033

27.97*

Significant

*

Significant

X31

0.949

0.019

51.23

X32

0.953

0.023

41.37*

Significant

X41

0.936

0.023

41.47*

Significant

*

Significant

X42

0.963

0.016

61.14

X51

0.896

0.040

22.26*

Significant

X52

0.920

0.021

43.66*

Significant

*

Significant

X61

0.897

0.038

23.73

X62

0.930

0.023

40.02*

Significant

*

Significant Significant

X71

0.934

0.021

44.78

X72

0.887

0.041

21.79*

Source: Primary Data The result of confirmatory factor analysis above is supported by the explanation from informant who had been interviewed. “Kalu dorang pe pelayanan katu yah seperti biasa noh, kalu torang bae-bae dorang lei bae. Kalu torang datang marah – marah ya bisa-bisa dorang nyanda mo layani, kalu dorang nyanda layani, ya so pasti nyanda mo kaluar noh itu izin.“ (The services delivery of them depend on us, if we come to the office friendly, they will deliver their service well. But, if we come to the office by anger, they will be reluctant to give their best service, and the license will not be issued). This explanation shown that the officers who are responsible in licensing services depend on the developers’ attitude. It means that they are not have good professionality in conducting tasks. The other explanations related to the licensing factor delay for the housing projects may describe the same. Conclusion and Recommendation The conclusions obtained from this study based on the formulation of the problem and the results of data analysis that has been done in previous chapters are as follows: 1. The architects licensing factor is the weakest determining factor of the housing project licensing delay with a contribution of 0.295. 2. The technical licensing factor is the determining factors of housing project licensing delay with a contribution of 0.489.

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3. The contractor licensing factor is the determining factors of housing project licensing delay with a contribution of 0,388. 4. Functions of bureaucracy are the determining factors of housing project licensing delay with a contribution of 0.433. 5. The internal functions are the determining factors of housing project licensing delay with a contribution of 0,384. 6. The human resources are the strongest determining factors of housing project licensing delay with a contribution of 0.668. Reccomendations that can be given based on the results of the analysis and conclusions of this study on the factors that cause delays in housing development projects are as follows: 1. Reccomendations for PT. X a. PT. X should continue to try to establish communication with the licensing body, so it can find the latest information and be able to establish a good and strong relationship. With this kind of relationship, then PT. X can have a better opportunity to provide advice to the licensing body regarding deficiencies in terms of services or procedures provided by the licensing body. b. PT. X need to continue to enhance cooperation with other companies, or be more active in the DPI community in order to have a broad relationship in the field of property that can provide ease in the development of the project. c. PT. X need to continually strive to provide input and advice to the licensing entity to enable the improvement of the quality of service and ease of care of licensing procedures in the project. 2. Reccomendations for the Licensing Body a. The licensing body should evaluate the implementation of the licensing procedure because based on the data obtained it is known that there are several obstacles caused by the complexity of the procedure which resulted in the delay of the housing project development. b. The licensing body should conduct strict monitoring on the services staff along with related parts, as based on the data obtained is known that the quality of services provided by staff is still not efficient and effective due to the lack of professional human resources owned by the licensing body in carrying out its duties. c. The licensing body should conduct training and regular evaluation in order to improve the quality of its human resources, especially the service, so they can provide better service and quality. 3. Reccomendations for the next researcher a. The researcher can investigate the same topic, namely regarding the factors that cause delays in the project, but with different objects and locations. b. Researchers can use the factors that cause the delays of the projects obtained from this study as a reference, and then make some improvement of the concept regarding the effect of those factors on the delays of the project on different objects.

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REFERENCES Dwiyanto, A. (2011). Mengembalikan Kepercayaan Publik Melalui Reformasi Birokrasi. Jakarta: Gramedia Pustaka Utama. Helmi. (2011). Membangun Sistem Perizinan Terpadu Bidang Lingkungan Hidup di Indonesia. Jurnal Dinamika Hukum Vol. 11 No. 1 Januari 2011. Ismael, I. (2013). Keterlambatan Proyek Konstruksi Gedung Faktor Penyebab dan Tindakan Penyebabnya. Jurnal Momentum Vol. 14 No. 1 Februari 2013 ISSN: 1693-752X. Kamaruzzaman, F. (2012). Studi Keterlambatan Penyelesaian Proyek Konstruksi (Stusy of Delay In The Complention Of Construction Projects). Jurnal teknik Sipil UNTAN/ Volume 12 Nomor 2 Desember 2012. Korompis, C. W., Sondakh, J. J., & Mawikere, L. (2013). Pengaruh Kinerja Auditor Internal terhadap Efektivitas Pengendalian Internal Prosedur Kredit Kendaraan Bermotor Pada Perusahaan pembiayaan di Kota . Jurnal Riset Akuntansi dan Auditing Volume 4, Nomor 1, Juni 2013. Kurniawan, F., & Ernawati. (2013). Pelayanan Perizinan di Sektor Publik. Jurnal Administrasi Pembangunan, Volume 1, Nomor 2, Maret 2013, hlm. 101-218. Malik, A. (2010). Pengantar Bisnis Jasa Pelaksana Konstruksi. Yogyakarta: CV. Andi Offset. Labombang, M. (2011). Manajemen Risiko Dalam Proyek Konstruksi. Jurnal SMARTek, Vol. 9 No. 1, Pebruari 2011: 39-46. okezone.com. (2014, September 02). Dipetik December 01, 2014, dari http://economy.okezone.com/read/2014/09/02/471/1033216/kebutuhan-rumah-diindonesia-membeludak-31-juta-unit Prasetya, H. (2009). Manajemen Operasi. Yogyakarta: Media Pressindo. Risza, S. (2010). Masa Depan Perkebunan Kelapa Sawit Indonesia . Yogyakarta: Kanisius. Sadyohutomo, M. (2008). Manajemen Kota dan Wilayah: Realita dan Tantangan. Salim, E. (2010). Pembangunan Berkelanjutan. Jakarta: Kepustakaan Populer Gramedia. Sulastomo. (2000). Manajemen Kesehatan. Jakarta: Gramedia Pustaka Utama. tempo.com. (2013, June 18). Dipetik December 01, 2014, dari http://www.tempo.co/read/news/2013/06/18/090489218/Pasar-Properti-IndonesiaTumbuh-20-Persen Wibawa, F. (2006). Perpaduan Praktik Perizinan Usaha Terpadu. Jakarta: Grasindo. Wignyosoebroto, P. S. (2005). Dakwah Pemberdayaan Masyarakat: Paradigma Aksi Metodologi. Yogyakarta: Pustaka Pesantren (Kelompok Penerbit LKiS Yogyakarta). Writer, G. (2008). 101 ++ Ide Jitu Peluang Usaha. Jakarta: Niaga Swadaya.

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INFLUENCING FACTORS IN CHOOSING A PRESCHOOL: A CASE STUDY IN IVY PRESCHOOL SURABAYA Amelia Alim, 2Tina Melinda♠

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Ciputra University Surabaya Indonesia Email: [email protected], [email protected] ABSTRACT This study aims to find out the influencing factors that affect parents’ decisionmaking in choosing a preschool. The influencing factors discussed are: curriculum, teaching quality, language, school facility, cleanliness, and teachers’ competency. The population in this study are 106 parents (of IVY students) in Ivy Preschool Surabaya. Meanwhile, the sample used is taken from total 51 respondents with a sampling method of simple random sampling. Based on the results of the analysis using multiple linear regression method, it is known that the factors of curriculum, quality of teaching, language, cleanliness, and teachers’ competency significantly influence parents’ decision-making in choosing a preschool. While school facility factor does not significantly influence parents’ decision-making in choosing a preschool. Keywords: curriculum, quality of teaching, language, school facilities, cleanliness, teachers and parents’ decisions in choosing a preschool.

INTRODUCTION It is commonly known that education is important since it is one of the most important aspects for an individual and community growth. Education is also seen as an individual learning process that helps the individual to achieve the goals set by religion and society around that person. Based on this fact, many people believe in the importance of enrolling their children in the best preschool to help them grow better. Preschool (known as Pendidikan Anak Usia Dini in Bahasa Indonesia) is defined as “A way to facilitate children growth through providing various teaching, experiences and stimulation which are set to help children develop thoroughly (Solehuddin and Hatimah, 2007). As parents start to realize the importance of enrolling their children in a preschool stage, many preschools (especially in Surabaya) are established to help children growing while also to meet service users’ demand. Thus, many education providers start to create such marketing strategy to attract many parents through many ways, such as giving their brand an identity that can make it distinct from the others. Besides that, education providers are also well aware of the influencing factors that have huge impact in the decision-making, specifically in choosing a preschool. However, this influencing factors may change over time, and thus, this study focuses on this issue in order to find the relevant influencing factors that still affect parents’ decision in choosing a preschool. In order to find the relevant influencing factors, IVY school is chosen as the main subject of this research. IVY Preschool is the only preschool in Surabaya which bases its curriculum on United States education. Moreover, this school orients itself to 9 basic skills which the main priority is to

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develop language and cognitive skills. Because of this distinct curriculum and priority, there is a significant growth of the number of students that can be seen as below,

PK 1: PreKindergarten 1 PK 2: PreKindergarten 2

Figure 1: Students’ population in 2012-2016 Despite of its increasing number, IVY preschool still has to find ways to attract more parents as the maximum quota for students is 180, and it is still far away from the recent total number. Thus, this study is conducted in order to find the relevant influencing factors that affect parents’ decision-making in choosing a preschool, to help IVY School’s management to manage their school better. LITERATURE REVIEW Previous Research Based on a previous study done by Dahari and Sabri (2011), there are 14 important factors that affect parents’ decision-making in choosing the best preschool for their own children. Those factors are: curriculum, language of instruction, teachers’ competency, teaching quality, friendly staff, facility and infrastructure, hygiene and cleanliness, transportation availability, safety and security, class size, meal nutrition, location, operation hours, and costs and affordability. These factors then applied in a pre-survey by using IVY parents as the subject. In the pre-survey itself, it is found that there are 6 main factors that are chosen by the parents which total percentages are up to 10%. Those factors are curriculum (16,8%), teaching quality (15,2%), language of instruction (15,2 %), school facility (12 %), cleanliness (11,2%) and teachers’ competency (10,4 %). These factors are then examined as the main focus of this research to determine the influencing factors that affect parents’ decision in choosing a preschool. Regression Analysis This kind of analysis has been used in numerous researches to find the influencing factors in choosing a preschool. In a research conducted by Yi Hsu and Chen Yuan Fang (2013) which used the subject of 380 parents of sixth graders in five elementary schools in Chuscahang, it is found that the influencing factors that affect decision-making are management, moral and discipline value, good reputation, supportive environment and school specialization. In another research conducted by Chew, et al. (2010), it is found that the influencing factors that affect parents’ decision-making are good service, supportive environment for students, excellent

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infrastructure and qualified lecturers. This result is gained through a research with 300 international students as respondents in Utara Malaysia University. These two previous researches are then used as the examples on how to apply regression analysis in this research in order to find out the relevant influencing factors in this study. The Buyer Decision Process Before buying a product or service, the consumers tend to evaluate the best choice from two or more choices. Salomon (2011) states that in the process of decision-making, there are steps that should be undergone. Moreover, these steps are affected by external factors that have huge impacts in the result itself. In the same line, Kotler and Armstrong (2012) also state that decision-making is a process when a buyer/consumer chooses the preferable product/service from many options that are offered to him/her (p. 152). Before it comes to the final decision, there are five steps that a buyer commonly go through based Kotler and Armstrong (2012, p.152-153). Those steps are: need recognition, information search, evaluation of alternatives, purchase decision and postpurchase behavior. In the first step, which is ‘need recognition’. The buyer recognizes a problem that should be handled and also his/her need to overcome the problem itself. Then, in the step of ‘information search’, a buyer tends to obtain the information about her/his ‘target’ product from as many sources as possible. The next one, in the ‘evaluation of alternatives’ process, buyer comes to the step when s/he will evaluate the brand alternatives, which are the alternatives of the same product from another brands. Then, in the process of ‘purchase decision’, there are two factors that can come between the purchase intention and purchase decision, which affect the decision itself. The first factor is attitude of others and the second one is unexpected situational factors. Lastly, in the last step, which is ‘postpurchase behavior’, the buyer will be examined by the marketer to find out whether s/he (consumer) feels satisfied with the product bought or not. Preschool Preschool (as known as Pendidikan Anak Usia Dini (PAUD) in Bahasa Indonesia) is a formal education institution that has been acknowledged by the government. This institution is made to help children age 1-4 years old grow better. Wana (2010) stated that preschool is a firstexperience for children to be more aware of their surroundings and be more responsible when they are away from their parents or house. Since parents believe that this stage is important, many parents always try to obtain as many information as possible during new academic year in order to find the ‘alternatives’ before they come to ‘making decision’ process (Agus, 2013). That is why, for parents who are very careful in choosing the best preschool for their children’s education, the steps described by Kotler and Armstrong take place in the decision-making process. RESEARCH METHODS This study is using quantitative research which is combined with multiple linear regression as the main approach. The hypothesis analysis itself uses F test and t test in order to find out the variables which simultaneously and partially affect parents’ decision in choosing a preschool. Moreover, this research also aims to find the most dominant variable which affects the decisionmaking. This study also uses simple random sampling, in which the samples are taken randomly, in order to give the fair chance for the parents to be the subject of this research. The technic used for simple random sampling is by using the draw or sweepstakes technic. Moreover, the samples used are the representatives of a population which have the same characteristics. Slovin’s formula (seen in Noor, 2011) is used to determine the number of total samples. The formula is as below,

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Description: n: total samples used N: total population e: the error value. The maximal error value is only 10 % The population of this research is IVY preschool parents. By applying Slovin’s formula in determining the total samples, it is decided that there are 106 mothers which become the sample of this research. That is because Indonesian mothers see education as the top priority after the moral (honesty) (Kartajaya, 2015). Therefore, when this formula is applied to find out the minimum total respondents, the result is as below, n: 106 / (1 + 106 x 0,12) = 106 / (1 + 1,06) = 51 respondents Furthermore, the data collection of this research uses the closed questioners survey which ask the respondents to choose an answer from various answers that are set before. There are two types of data resources that are used in this research. Those resources are primary and secondary data. The primary data is obtained from questioners while the second data is obtained from the library research. To get the reliable result, there are two types of variables that are examined by using multiple linear regression. Those variables are first, dependent variable which is formed as the result from the independent variables’ effect. Second, independent variables which are the variables manipulated by the researcher, and this type of variable is also highly influenced by the dependent variables. Dependent Variables The dependent variables in this research are related to buyer decision process in choosing a preschool. The decision-making itself is a result that concerns to the buyer decision process which are described in the research of Kotler & Armstrong (2012). Those are: need recognition, information search, evaluation of alternatives, purchase decision and postpurchase behavior. Independent Variables The independent variables in this research are:

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Table 1: Independent Variables Variables

Operational variable X1

Curriculum

X2

Teaching quality

X3

Language of instruction

X4

School facility

Indicators

International-based curriculum, academic achievement, qualified teaching material and material accordance to the age. Discipline teacher, caring teacher, communicative teacher and competent teacher at relationship building. English as the language of instruction and Mandarin as the language of instruction. Comfortable classrooms, airconditioning classrooms, complete

The Fourth International Conference on Entrepreneurship | Book One

X5

Cleanliness

X6

Teachers’ competency

learning media, playground availability and library availability. Classroom cleanliness, toilet cleanliness and environment cleanliness. Teachers’ age, teachers’ appearance, teachers’ friendliness, teachers’ education background and teachers’ teaching experiences.

Variable Measurements This research uses Likert Scale to measure the variables. Sugiyono (2013, p. 168) states that this scale is used to measure behavior, opinion and perception of an individual or group about certain phenomenon happened in a society. The five categories provided in this scale are: Strongly agree (SA) (marked as 5), agree (A) (4), neutral (N) (3), disagree (D) (2), strongly disagree (SD) (1). Data Analysis This research uses multiple linear regression with the hypothesis of F test and t test. This analysis is conducted with the aim to find out the relationship between independent variables and dependent variables. This research seeks whether the variables of curriculum, teaching quality, language of instruction, school facility, cleanliness and teachers’ competency affect positively or negatively to parents’ decision-making in choosing a preschool. The formula used is as below, Y = α + β1X1 + β2X2 + β3X3 + β4X4 + β5X5 + β6X6+ e Table 2: Formula Information Information

Sign Y

Dependent Variable (Decision-making in choosing a preschool.

X1

Curriculum

X2

Teaching quality

X3

Language

X4

School facility

X5

Cleanliness

X6

Teacher

α

Constanta (Y value if X1, X2… X5 = 0)

β

Regression coefficient

e

Error

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RESULT AND DISCUSSION The result of this research shows that there are two variables that are dominant in parents’ decision-making in choosing a preschool. The result can be seen as below, Table 3: The Result of Multiple Linear Regression Test Coeffic Std. Std. Variable ient Error Coeff B t-stastistic Constant Curriculum (X1) Teaching Quality (X2) Language (X3) School Facility (X4) Cleanliness (X5) Teacher (X6) R squared Adjusted R squared F Statistic Prob (F Statistic)

0,033 0,197 0,283 0,177 0,075 0,175 0,239

0,423 0,090 0,123 0,074 0,071 0,085 0,098

0,251 0,262 0,258 0,110 0,208 0,272

2,179 2,299 2,402 1,044 2,061 2,435

Sig.

Result

0,937 0,035 0,026 0,021 0,302 0,045 0,019

Accepted Accepted Accepted Rejected Accepted Accepted

0,621 0,569 12,020 0,000

From table above, the regression equation result is: Y= 0,033 + 0,197X1 + 0,283X2 + 0,177X3 + 0,075X4 + 0,175X5 + 0,239X6. From this equation, it can be concluded that if each variable increases (in the assumption that another variable is constant), the parents’ decision in choosing a preschool will increase too. Second, the result shows that the significant factors (variables) that affect parents’ decision in choosing a preschool are curriculum, teaching quality, language, cleanliness and teachers’ competency with total percentage of 62,1 percent. In contrary, the variable of school facility does not have significant effect in parents’ decision-making. Third, it can also be concluded that the most dominant factors that affect parents’ decision-making are teaching quality and the teachers’ competency. CONCLUSION From this research, it can be concluded that the relevant factors which affect parents’ decisionmaking are the five factors of curriculum, teaching quality, language of instruction, cleanliness and teachers’ competency. However, the last factor, which is the factor of school facility, does not create major impact in parents’ decision-making process. Moreover, it can also be concluded that the most dominant factors that affect parents’ decision-making are teaching quality and the teachers’ competency. In this research, however, the result obtained from the factor of ‘school facility’ does not meet researcher’s expectation. Thus, for the next researcher, it is strongly suggested for him/her to revise the ‘school facility’ factor in order to show the real condition on the field. Moreover, there are 37,9 percent of the factors that have not been discussed on this research. Those factors concern to the cost, transportation availability and operational hours since those factors are also questioned by parents when they try to find the best preschools for their children. Therefore, it is strongly suggested for the next researcher to explore these 37,9 percent of these factors that cannot be discussed in this research.

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REFERENCES Agus, D. S. (2013) Tips Jitu Mendongeng. Yogyakarta: Kanisius. Chew, et al. (2010) ‘Factors Affecting Choice for Education Destination: A Case Study of International Students at University Utara Malaysia’, Journal of University Utara Malaysia LB2300 Higher Education. Dahari, Z.& Sabri, M. (2011) ‘Factors that Influence Parents’ Choice of Preschools Education in Malaysia: An Exploratory Study’, International Journal of Business and Social Science Vol. 2 No. 15; August 2011. Kartajaya, H. (2015) Winning the Mom Market in Indonesia. Jakarta: Gramedia Pustaka Utama. Kotler, P. & Armstrong, G. (2012) Principles of Marketing (14th Edition). New Jersey: Pretince Hall. Solehuddin & Hatimah, I. (2007) Ilmu dan Aplikasi Pendidikan Bagian 4: Pendidikan Lintas Bidang. Bandung: IMTIMA. Solomon, M. R. (2011) Consumer Behavior: Buying, Having and Being (9th Edition). New Jersey: Pretince Hall. Wana, J. (2010) How to Choose The Best Preschool for Your Child. Illinois: Sourcebooks, Inc. Yi, H. & Chen, Y. (2013) ‘An Analysis of Factors Affecting Parents’ Choice of a Junior High School’, International Journal of Business, Humanities and Technology Vol. 3 No. 2; February 2013.

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DEVELOPING STRATEGY OF PRODUCT, PRICE, PROMOTION AND LOCATION TO GAIN REVENUE OF KAPIN RESTAURANT USING SWOT ANALYSIS Heryanto Prayogo, 2Tina Melinda♠

1

Ciputra University Surabaya INDONESIA Email : [email protected] 2 [email protected] ABSTRACT Revenue is the gross inflows of economic benefits arising from the normal activities of an entity during a period. The SWOT analysis is an analysis based on the assumption of an effective strategy between the company's internal resources (strengths and weaknesses) with its external situation (opportunities and threats). The purpose of this study is to find out what strategies need to be taken in order to increase the income of the Kapin restaurant. The research method used is Qualitative method. The research results of Kapin restaurant is Kapin restaurant Located in quadrant Diversification Strategy (ST) situation where company has many strengths internally but also many external threats. Kapin restaurant need an understanding of the situation that occurred in the world of restaurant, so no one in determining what strategies to maintain and what strategies need to be added. Keywords: Revenue, EFE, IFE, SWOT Analysis

INTRODUCTIONS East Java's role in contributing to the national economic growth is arguably a substantial percentage contribution, East Java contributing 14.87% to the national Gross Domestic Product of Rp 9,184 trillion, according to East Java Central Statistics Agency East Java's 2013 growth of 6.55% and estimated in 2014 will increase 6.4-6,8%. And the sectors contributing to economic growth in East Java include: transport and communications sector of 10.06% in 2013 and predicted to increase by 2014 by 10%, trade, hotel and restaurant sector by 7.22% and predicted increase In the year 2014 of 8.44-8,8%, and sekor of building and construction equal to 8,99% and predicted in year 2014 increase as big as 8,8-9,2%. As well as the value of investments that have increased indicate that the business climate in East Java is getting better with data from East Java Investment Board which shows in the year amounting to 170 trillion or an increase of 17% from the year 2013 which amounted to 145 trillion Rupiah. Economic growth in Surabaya according to Surabaya city statistics 2013, explained that Gross Regional Domestic Income in 2012 which is more than 264 trillion Rupiah, 44.46 percent is contribution from Trade, Hotel and Restaurant sector. The total GDP of the restaurant sector in 2011 amounted to 29 trillion increased in 2012 by 33 trillion, or an increase of 12 percent. From the results of existing statistics, it can be seen that the growth of restaurants in the city of

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surabaya has increased significantly. So the restaurant is required to have each strategy in accordance with the advantages of each owned restaurant in meeting sales targets. The Kapin restaurant is a restaurant serving chinese food, a family business pioneered by the first generation of Narto Prayogo in 1952 along Pecindilan street, in 1972 moving to a larger location that could hold up to 30 tables on the market street of the wetan 55B, In 1994, Narto Prayogo as founder died and was replaced by his son David Pragoyo. In 2004 the second generation that none other than David Prayogo died and was replaced by Tan Sudjinah as the wife of the late Mr. David and Heryanto Prayogo, Handoyo Prayogo and Himawan Prayogo as the son of the late David Prayogo. As time progressed in 2006 Kapin restaurant opened its first branch in Raya Kupang Indah 23, Surabaya, and the second branch in 2011 at Manyar Kertoarjo 5/30, Surabaya. In 2011 Kapin restaurant positioned on the brand of Shark Fin and cantonesse food, Kapin restaurant excellence is the processing of food ingredients are still selected directly by the owner and the process of raw materials to the fast food does not use chemicals that are not feasible for consumption. Kapin restaurant also sells guangtong or cantonesse chinese food. As for some of the menu of Kapin restaurant is Shark Fins, nasi goreng widodo, udnag ham saos inggris, burung dara goreng and many other main course menu. The Sharkfin menu is branding from the Kapin restaurant, where the product is traditionally processed without chemicals such as bleach or other, so it becomes an advantage with the enjoyment of a fresh taste. There is also Nasi Goreng Widodo, which is made in accordance with the demand from loyal customer who like dining in restaurant Kapin demand fried rice served with plenty of crab meat which according to Mr. Bondan Host of the Culinary Tour event that aired by one of the private television stations in Indonesia. When covered, he said that his Nasi Goreng Widodo was "Maknyus" and entered in one of the forums run by Mr. Bondan with the topic "The World's Most Expensive Fried Rice" Increasing number of restaurant growth in surabaya cause more fierce competition. LITERATURE REVIEWS Previous Research The first study taken the author of research conducted by Jimmy Bastian (2012) with the title "Determination of Marketing Strategies In CV. SURABAYA GOLD Based on Strength Analysis, Weaknesses, Opportunities, Threats (SWOT) And Analytical Hierarchy Process ". The purpose of this research is to increase the level of sale of gold jewelry 99% content in CV. Surabaya Gold. Data collection method used is by interviewing leader and manager of each division in that company. The results of this study conclude that the need to undertake a marketing strategy that is the principle of product differentiation, product and service alliances, overall cost leadership and promotional alliances. The second study was conducted by Syamsuri (2010) under the title "Analysis of the Application of Marketing Strategy at Chicken Grilled Wong Solo in Malang Branch". This study aims to win the competition in the restaurant industry. The sample of this research is the employee by interviewing the branch manager and manager of each division directly involved in the business process. The result of this research can know that internal strength must be priority first, then the constraints and external factors need to be considered again especially so that more can control the market share more broadly. The Third Study was taken from the journal by Pholpuntin., Et al (2014) with Title “The Analysis of TOWS Matrix for Promoting Thai Kitchens into ASEAN Markets of Lao People’s Democratic Republic and Socialist Kingdom of Cambodia”. The purpose of this research is to know the market situation of the Lao People's Democratic Republic and the Kingdom of Cambodia and develop appropriate marketing strategies to promote Thai cuisine to the ASEAN market. Data collection methods used are through interviews to 60 Thai restaurant entrepreneurs

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in these two countries. The results of this study say that Thai food business in two countries shows strength and profitable opportunities, Thai food in both countries become one of the favorite food menu. To develop a Thai restaurant business it is advisable to self-run or joint venture to ensure the quality of food and the impression of the restaurant can be kept stable. The Fourth Study is adapted from Jones, et al (2015) entitled "Impact of Social Media on Small Businesses". The purpose of this research is to know the role and economic impact that internet, especially website and social media to small business. With the aim to investigate the benefits of using internet and social media for small businesses operating in the region. Methods of data collection used by conducting surveys and interviews with small business owners. The results of this study conclude that the benefits of using websites and social media sites raise awareness of questions, improve customer relationships, increase new subscriber numbers, increase the ability to reach customers on a global scale, and help promote other local businesses in the surrounding area. SWOT Analysis SWOT analysis according to Pearce II and Robinson, Jr (2013: 200), is an analysis based on the assumption that an effective strategy is derived from good conformity between the company's internal resources (strengths and weaknesses) with its external circumstances (opportunities and threats). SWOT analysis is also based on the logic that can maximize strength (Strengths) and opportunities (Opportunities), but simultaneously can minimize weakness (Weaknesses) and threats (Threats) (Rangkuti, 2013: 19). According to Kotler and Armstrong (2012: 53), strength includes internal strength, resources owned, and a positive environment that would help a company in serving customers and achieving goals. Weakness includes the company's internal deficiencies and environmental factors that are less comfortable to the detriment of the company's achievements. Opportunities are factors that support or an ongoing trend that can be explored to bring benefits to the company. While Threat is an external factor or trend that is less good impact on corporate achievement. According to Lukiastuti and Handani (2011: 74) one of the analytical tools used to compile a description of the strategic factors of a company is a SWOT matrix. This matrix is considered able to describe clearly how the opportunities and external threats faced by the company must be adjusted with the strengths and weaknesses it has. This matrix can yield four possible strategic alternativities. Internal Factor Evaluation and External Factor Evaluation The Internal Factor Evaluation (IFE) is a tool of strategy formulation that serves to summarize and evaluate the audit information internally into the major strengths and strengths weaknesses within the business functional areas, as well as the basis for identifying and evaluating Relations between these areas. The External Factor Evaluation (EFE) is a strategy formulation tool that serves to summarize and evaluate information of external audit results into opportunnities and threats categories. Five Forces Analysis Aspects Environmental industry will be more directed to the aspect of competition in which the company resides. Consequently, the factors that affect the competitive conditions, such as the threats and strengths of the company, including the conditions of competition itself, become necessary to be analyzed. Porter (2012) proposes the concept of Competitive Strategy that analyzes business competition based on five major aspects known as the Five Competitive Forces.

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Threats of new entrant, The threat of a company is the coming of fellow companies that produce similar products, as well as obstacles in geography (Al Race: 2013) ". There are several factors that can influence the difficulties of entering an industry, including economies of scale, product differentiation, brand identity, transfer costs, capital requirements, access to distribution, absolute cost advantage, government policy and competitors' reactions (Kodrat 2009: 121) Bargaining power of supliers, According to Dess., Et al (2010: 9), the strong bargaining power of suppliers when, it is dominated by only a few large and more concentrated companies from other industries that sell, There is no satisfactory substitution product for the company, Companies are not significant buyers for suppliers, Product suppliers are critical to the success of the buyer's market and The effectiveness of supplier products has created a high switching cost for the company's industry. Bargaining power of customers, A company can not survive without a buyer. According to Dess., Et al (2010: 58), buyer's bargaining power becomes high if: Buyers make purchases in relatively large quantities, Products purchased are standard products, can not be differentiated and can be obtained from other manufacturers, If the manufacturer has a high switching fee when one of the buyers abandons them, The product is less important in the buyer's production process and The buyer has complete information about the suppliers. Threats of subtitutes, According to Dess., Et al (2010: 60), there are three factors that can measure how strong the threat of substitution products for a company. The relative price or performance of the replacement product, Switching cost buyers to obtain replacement products and The tendency of buyers to try replacement products. Industry rivalry, Competition among companies is something that can be defined as the efforts of industry players or competitors to be able to maintain and increase their market share, income, profitability, and image (Al Race 2013). High competition can limit the company's profitability. According Dees., Et al (2010: 61) Intensity of competition between companies will be higher if: The number of different and balanced competitors, Sluggish industry growth, Fixed costs and high equipment, Lack of product differentiation and low switching costsand High exit barriers. RESEARCH METHODS This study uses the qualitative category because it includes a process that tries to gain a better understanding of the complexity that exists in human interaction. This research is descriptive, such as interview transcript and field note. Research subjects are informants who become sources of information in answering research problems (Bungin, 2013). The subjects of the study were determined by using purposive procedure, ie to determine the group of participants who became informants in accordance with the selected criteria relevant to the researcher problem (Bungin, 2013). Criteria of informants selected by the researchers are restaurant owners, suppliers and restaurant customers. Researchers using semi-struktural way because it can dig information more broadly and deeply. Interview equipment used is a recorder and stationery. The steps of method in collecting data in this research is make a list of interview questions according to the theme of the researcher to the informants who have been determined about the strategies undertaken in developing restaurant or current state of restaurant development.Digging information from informants in accordance with the theme and focus of researchers in the development of the restaurant world that happens today. Researchers using triangulation techniques with theory because triangulation with theory is done by describing patterns, relationships and include explanations arising from the analysis to find themes or comparative explanations The technique used by analyzing the results of interviews then do the classification and sort out the important things to determine patterns and relationships to take the focus of the researcher's theme.

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The results of the interviews were analyzed using SWOT which is a tool for developing strategies based on the internal and external environment situation.

RESULTS AND DISCUSSION IFE analysis is used by researchers to find out the strong and weak internal factors that occur in the company that has a goal to decide what strategy will be done in making the right decision. Table. 1 IFE Analysis Table Internal Factor

Weight

Strength : 1. The menu is not the same as other restaurants. 2. The characteristics of a product that is always maintained 3. Price menu in accordance with the quality of products sold 4. Easly know by customers Weakness: 1. Place is less spacious 2. Promo not always exist and depend on other party (Bank) 3. Lack of new menu innovation 4. Unstable taste standard

Rating

Weight x Rating

0.15

4

0.6

0.1

3

0.3

0.1

4

0.4

0.1

4

0.4

0.15 0.15

2 2

0.3 0.3

0.15 0.1 1

2 2

0.3 0.2 2.8

EFE analysis used by researchers in knowing how the external factors that greatly affect the company in stepping forward and what decisions will be taken in the face of each resio that occurred from the company eksteral.

Table 2 EFE Analysis Table External Factor Opportunities: 1.Creating a new menu. 2. High level of interest 3. Good relationship with customers 4. Opening larger and larger buildings Threats: 1. The equation of the sold menu 2. Location of a more strategic competitors 3. The number of competitors in the restaurant world 4. Competitors are more innovative in making promotions

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Weight

Rating

Weight x Rating

0.15 0.1 0.15 0.1

3 2 4 4

0.45 0.2 0.6 0.4

0.1 0.1

3 2

0.3 0.2

0.15

4

0.6

0.15

4

0.6

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1

3.35

The result of weighting and rating as well as reduction of Total Strength items with Total Weakness converted into Cartesian coordinate form is obtained by X axis. In the Cartesian diagram form, the X-axis of the Strength-Weakness item is 0.6. For Opportunity - Threat conditions, treated the same thing as Weakness - Strength. Next item related Opportunity - Threat, then can be seen the calculation results, reduction of Total Opportunity items with Total Threat items yield value of -0.05.Value is then converted Y Cartesius diagram. Coordinate X, Y (x, y) is the coupling axis of the Strength-Weakness item coordinates and the Opportunity-Threat item coordinates. In the Cartecius diagram, the matrix axis is (x, y) = (0.6, 0.05).

Opportunities Strategi SO

Strategi WO

Turn Around Strategy

Aggresive

Strategy

Weakness Defensive Strategy

Strength

(0.6, -0,05)

Strategi WT

Diversification Strategy

Strategi ST

Threat Figure 1 TOWS Matrix Based on Figure 1, it can be seen that Kapin restaurant is in the Diversification Strategy (ST) quadrant where the company has many strengths internally but many external threats sometimes hamper the business process so that a mature strategic plan is required by the business actors in order to capture the long-term opportunities . Based on the results of cartesian SWOT matrix diagram, a strategy that can be done by the restauran kapin namely: 1. In maximizing the strength of the chinese restaurant will be better if planning the opening of new outlets. 2. Maintain the standard stability of the tastes of the menu products sold so that there is no difference with one branch to another, especially the main menu and favorite menu that many customers demand as well as other menus 3. Increase the promotion in accordance with the ability of restaurant kapin by monitoring programs conducted by other competitors. 4. Creating a new menu that is more innovative so as not to lag too far with the competitors.

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The strategy to be implemented near the chinese restaurant in the near future after doing research are: 1. Maintain a common standard taste of the menu sold from the three branches. 2. Make promotions more attractive than other competitors 3. Creating a new menu in accordance with the current market share situation. CONCLUSIONS From the results of internal factor analysis and external factors, restaurant kapin is in quadrant situation Diversification Strategy (ST). The circumstances in which the company has a lot of internal strength but many external threats that can hamper the process of business progress. Pricing strategy, product, promotion is done according to the standard owned by the company but its application has not been adjusted to the current situation. In determining the product, price, promotion to increase the revenue of Kapin restaurant in accordance eith the right and proper strategy such as: 1. Strategy procedure that should be done by Kapin Restaurant in increasing revenue that is by paying attention to every factors that influence both from internal factor and external factor. 2. Leverage existing opportunities by engaging in more attractive promotional activities from competitors for the purpose of attracting customers and increasing sales. 3. Creating a new menu that innovates in order to make customers have a sense of high curiosity. 4. Kapin restaurant must always up to date in reading situation and opportunity that exist in restaurant news REFERENCES Alma, Buchari. (2007) Manajemen Pemasaran & Pemasaran Jasa. Bandung: CV. Alfabeta. Bungin, Burhan. (2013). Penelitian Kualitatif.Edisi ke 2. Jakarta:Prenada Media. F. R. David. (2009) Manajemen Strategis, Jilid 1, Edisi 12, Terjemahan Dono Sunardi, Penerbit Salemba Empat, 2009. Herdiansyah, Haris. (2012) Metodologi Penelitian Kualitatif Untuk Ilmu-Ilmu Sosial.Jakarta: Salemba Empat. Jatim Topang Perekonomian Nasional. Jawa Pos, 20 Maret 2014,pp.1. Jones, Nory. Borgman, Richard Borgman &Ulusoy, Ebru. (2015) "Impact of social media on small businesses", Journal of Small Business and Enterprise Development, Vol. 22 Iss: 4, pp.611 - 632 Kotler, Philip dan Armstrong, Gary. (2012) Principles of Marketing 14 th Edition. Pearson Education Limited. Kotler, Philip dan Kevin Lane Keller. (2012) Marketing Management 14th Edition. Pearson Education Limited. Lukiastuti, Fitri dan Handani, Mulyawan. (2011) Manajemen Strategik Dalam Organisai. Jakarta:PT.Buku Seru. Narim, Abdi Patria Syafei. (2011) Restoran. http://jurnal.isips.ac.id/index.php/artikel/article/view/931/1635 (diakses: 8 maret 2014) Pearce,J., R.B Robinson,J. (2013) Manajemen Strategis: Formulasi, Implementasi, dan Pengendalian, Edisi 12. Jakarta: Salemba Empat Pholpuntin, Sirote. Serirat, Sirivan. Anuwichanont, Jirawat & Mechinda, Panisa ‘The Analysis of TOWS Matrix for Promoting Thai Kitchens into ASEAN Markets of Lao People's Democratic Republic and Socialist Kingdom of Cambodia’, Universal Journal of Industrial and Business Management Vol. 2(7), pp. 182 - 187

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Rahardjo, Adith. (2008) 5 Rahasia Sukses Bisnis Restoran. Penebar Plus, Depok. Rangkuti, Freddy. (2013) Analisis SWOT: Teknik Membedah Kasus Bisnis, Cara Perhitingan Bobot, Ratin, danOCAI. PT Gramedia Pustaka Utama, Jakarta Rangkuti, Freddy. (2009) Measuring Customer Satisfation : Teknik Mengukur dan Strategi Meningkatkan Kepuasan Pelanggan, PT. Gramedia Pustaka Utama, Jakarta Setiadi, Nugroho.(2008) Perilaku Konsumen Konsep dan Implikasi untuk Strategi dan Penelitian Pemasaran. Jakarta : Kencana Prenada Group. Statistik Daerah Kota Surabaya. (2013) http://surabayakota.bps.go.id/?hal=publikasi_detil&id=4 (diakses: 4 maret 2014), pp.35. Sugiyono. (2012) Metode Penelitian Kuantitatif Kualitatif dan R&D. Bandung: Alfabeta. Utama, I Gusti Bagus. & Mahadewi, Ni Made Eka. (2012) Metodologi Penelitian Pariwisata & Perhotelan. CV Andi Offset, Yogyakarta. Ward, John. Peppard, Joe. (2002) Strategic Planning for Information System, 3rd edition. John Wiley and Sons, Inc, New York.

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THE ROLE OF SWOT IN BUSINESS DEVELOPMENT OF MAHREEN COLLECTION Laili Affidah, 2J.E. Sutanto♠

1

Ciputra University Surabaya INDONESIA Email: [email protected] ABSTRACT Fashion industry – clothing business especially, keeps on having new developments and changes very quickly. Clothes that are very popular right now can be outdated just in a matter of short period of time. Looking at the potential of fashion business and the market’s enthusiasm for fashion industry in East Java, a boutique named Mahreen Collection was opened in 2010. It is located at Jalan Parengan no. 99, Kraton, Krian. The purpose of this research is to know the role of SWOT analysis in formulating the business strategy of Mahreen Collection based on the internal and external condition. The type of research used is descriptive research using qualitative method. This research uses purposive sampling technique, which is a procedure of sampling where samples are chosen from population based on the compatibility with the purpose of the research. The chosen samples are the owner of Mahreen Collection, the competitors, the suppliers, the buyers, and an expert on marketing and business. This research is done at Mahreen Collection outlet, which is at Jalan Parengan no. 99, Kraton, Krian – Sidoarjo. Moreover, this research was done during the period of November 2015 – December 2016. Data analysis technique used in this research is qualitative data analysis. The result based on the analysis on the company’s internal condition shows about the strengths and weaknesses of the company. The strengths of Mahreen Collection are (1) selling high-quality fashion products, (2) providing up-to-date model, (3) great availability of goods, and (4) experienced in fashion business. On the other hand, the weaknesses of Mahreen Collection are (1) currently having only one store, (2) limited capital sourced from private funds, and (3) limited human resources. Moreover, the result based on the analysis on the company’s external condition shows about the opportunities and threats for the company. The opportunities are (1) lots of market demand for fashion products, (2) high consumer’s purchasing power, (3) Mahreen Collection’s customers have consumptive behavior – they frequently change their fashion products, and (4) the government’s support for small and medium businesses. Meanwhile, the threats for the company are (1) big numbers of competitors in fashion business, (2) consumers’ freedom of choice in choosing fashion products, and (3) low barrier of entry for new competitors. All in all, SWOT analysis is very useful to decide the strategy to further develop the company. Mahreen Collection is on Quadrant I and the correct choice is S-O strategy, which is Growth-Oriented Strategy. On

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this Quadrant, the company has the opportunities and strengths that can be used to maximize the future opportunities. This strategy focuses on supporting the growth of aggressive policies. The elaboration of the business strategy to further develop Mahreen Collection is by opening new outlets in Krian region. Key words: role, SWOT analysis, business development INTRODUCTION Clothing is one of the human primary needs besides food and shelter. Nowadays, clothing functions not only as a primary need for protection, but also as a fashion, trend, and style. With more people spending money on clothing, in 2010, a boutique named Mahreen Collection was established in Parengan Street no.99, East Java. After continuous positive development in 5 years of establishment, the boutique owner decided to further expand the business. Therefore, this research aims to analyze the internal and external conditions of Mahreen Collection in order to make SWOT analysis and ultimately, formulate the best strategy which enables Mahreen Collection to expand its reach and income the most. LITERATURE REVIEW Previous Research There are four relevant previous researches used in writing this research. The first research titled “Strategy Formulation and Implementation for PT. Multigarmen Jaya” was written by Yoanita and Wandebori (2013). The purpose of this research is to formulate strategy for PT. Multigarmen Jaya in facing tight competition in garment industry. The research uses both internal analysis such as value chain and resources and external analysis such as PEST, Porter’s Five Forces and competitor analysis. The second research was written by Joen and Praptiningsih (2013). The title of this research is “Deskripsi Pengelolaan dan Pengembangan Usaha Modes Mbak Soem di Surabaya”. This descriptive qualitative research is purposed to: (1) describe the management and development of Mbak Soem’s tailoring business; (2) analyze external and internal environment in textile industry; and (3) construct business development methods for Mbak Soem’s business. The third research by Jeyaraj et al. (2012) was titled “Application of SWOT and Principal Component Analysis in a Textile Company - A Case Study”. There are three purposes of this study, which are to: (1) identify SWOT variable of textile company; (2) find significant SWOT variables; and (3) construct SWOT matrix for textile company. This study used 125 respondents and the data was processed using Principal Component Analysis method and continued by qualitative method in constructing SWOT matrix. The fourth research by Shooshinasab et al. (2013) was titled “Strategic Planning for Development of Sport Events Tourism Industry in Iran”. The purpose of this study is to present the process of strategic planning done for the development of sport event in hospitality industry in Iran. This study used 200 respondents who consist of hospitality academicians, federation manager, Olympic committees and cultural organization in Iran. The analysis technique used is confirmatory analysis continued with SWOT. Internal Analysis David (2012:177) stated that companies need to analyze their internal condition to be able to maximize their strengths in order to use available opportunities and reduce their weaknesses. Internal analysis of a company consists of human resource, marketing, finance and operational with the detail of each as such: 1. Human resource

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Human resource activities include analyzing strengths and weaknesses of current workers in all levels and focusing on important human resource functions such as recruitment, selection, training, workers’ relations and compensation (Bateman and Snell, 2014:168) 2. Marketing Marketing activities include identifying markets, main market segments and competitive position (market share) (Bateman and Snell, 2014:168). The purpose of segmenting is to target the most responsive market using minimal costs (Pophal, 2014:48). Lamb et al. (2015:145) wrote about three mainly used targeting strategies, which are undifferentiated targeting, concentrated targeting and targeting to several segments only. Positioning of the selected target market(s) is the last important activity. Lamb et al. (2015:150) listed several types of positioning commonly used such as positioning based on attribute, price and quality, usage or application, user, product class, competitor and emotion. 3. Finance The financial state of a company is often considered as a benchmark of its competitiveness and its appeal for investors (David, 2012:204) . There are three function of finance such as: (1) capital budgeting – allocation and reallocation of capital and resources for projects, products, assets and division of an organization; (2) financing – to decide on the best mixture of capital structure including publishing stocks, applying for loans, selling assets, et cetera; (3) dividend sharing – to be concerned of issues such as the percentage of profit payable to the stockholders, the stability of dividend paid, and the repurchase or publishing of stocks. 4. Operational Assauri (2011:27) stated that the design of production and operation system includes: selection of product design, selection of processes and tools, selection of location and company site, layout design, workflow design, job description, production strategy as well as production capacity selection. External Analysis External conditions are factors outside the company’s control which can influence company’s decision on its mission and chosen activities, organization structure, and internal processes (Pearce and Robinson, 2013:112). External conditions can be analyzed using Porter’s Five Forces model with the detail as below: 1. Industry Rivalry  Many exiting rivals with approximately similar size and strength  Slow industry growth resulting in struggle for seizing market share  Undifferentiated products and or services  High fixed cost  Capacity enhancement must be done in large quantity  Rivals are diverse in terms of strategy, origin, and personality 2. Threat of New Entrants  Economic Scale  Differentiation of products and or services  Capital requirements  Access to distribution channel  Government regulation 3. Threat of Substitutes David (2012:150) stated that the increasing competitive pressure of substitutes happens when the relative price of substitutes reduced and when customer’s switching cost is also lower. 4. Bargaining Power of Suppliers

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 Small number of suppliers  Products supplied are unique or different  Suppliers are not in competition with other products  Suppliers have the capability to do vertical integration to end users  The industry is not the main customers for suppliers 5. Bargaining Power of Buyers  Buyers are concentrated or buying in bulk  Products bought are standard ones  Products bought are important components with large price value  Buyers receive low profit margin  Industry’s products are not important for the quality of buyers’ products  Industry’s products do not result in cost-saving for buyers SWOT Analysis SWOT Analysis is an organized approach in valuation of strengths and weaknesses of a company as well as the opportunities and external threats. Strengths can be developed into company’s differing value toward competitors, while weaknesses can be exploited by competitors. Opportunities can be used to create uniqueness and differentiation with competitors and threats that can be disadvantageous for companies have to be eliminated as soon as possible Strategy Formulation According to Bryson (1995) as quoted by Nugroho (2010:11), strategy formulation is a discipline purposed to bring about results and basic activities that create and guide an organization to understand what an organization is, what it does, and why it does it. In strategy formulation, there are some important things needed to be considered, some of which are (Dirgantoro, 2011:83): (1) understanding vision, mission, and company’s objectives; (2) current company’s position such as market share and internal condition; (3) ability to identify internal and external factors; and (4) finding alternative solutions to achieve the purpose of organization efficiently. In strategy formulation, one of the most popular tools is grand strategy matrix (David, 2012:347) in which the assessed company can be positioned in one of the four quadrants thus giving it ideas about recommended strategies to be focused on. Business Development The key to success in responding future business challenge is emphasized on how a company able to formulate a tactical business plan in short-term and a strategic one for long-term which are aimed to increase company’s productivity by good risk management. Business expansion can be in the form of new units or new branches or increase of business capacity (Suharyadi, 2011:122). Analysis of business development includes several aspects such as raw material procurement for production processes, work capital and investment, addition of production tools, finding new suppliers and human resources, et cetera. Last but not least, to evaluate the current business and the ideal one in the future (Muchtar, 2010:190). RESEARCH METHODS This research was conducted using descriptive research with qualitative approach. This research was done at the boutique location, Parengan Street no.99, Kraton, Krian within the time period of November 2015 to December 2016. Data collection will be done using research paper, interview and direct observation towards respondents. The sampling technique used in this study is purposive sampling because the respondents were chosen by their expertise and experience toward fashion industry. The respondents used in this research are:

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1.

Respondent for internal analysis The main respondent for this analysis is the owner of Mahreen Collection.  Human resource: recruitment, selection, work allocation, training, workers’ relations, and compensation  Marketing: STP (segmenting, targeting, positioning), production planning, pricing regulation, promotion, and distribution  Finance: allocation of budgeting, source of beginning capital and capital inflow for company’s development, last year company’s income, and proportion of profit sharing  Operational: product and workflow design, job description, production and stock planning, quality control, operational workforce management 2. Respondents for external analysis The model of external analysis is based from Porter’s Five Forces, thus the respondents chosen include rivals, suppliers, customers, newcomers, and substitute product suppliers of Mahreen Collection.  Industry’s rivalry: the rivalry environment among existing companies in fashion industry as of now  Potential new entrants: newcomers bringing in new capacity and substantial resources with the purpose of some part of market share  Threat of substitutes: the consideration given by current customers toward using substitute products sold with lower prices  Bargaining power of suppliers: suppliers’ degree of freedom in increasing price of lowering quality of products sold  Bargaining power of buyers: buyers’ power in demanding higher quality or better services which can reduce company’s profit 3. Marketing expert in fashion industry The chosen respondent is Dian Primadini, a marketing expert as well as the owner of a big and long existing fashion business.

SWOT Analysis and Strategy Formulation All of the data gathered will be categorized into SWOT and used to formulate strategies such as S-O (Strength-Opportunity), W-O (Weakness-Opportunity), S-T (Strength-Threat), and W-T (Weakness-Threat) strategies. The assignment of the company’s position in grand strategy matrix will be based on two evaluative dimensions which are competitive position and growth of market (industry). Data Triangulation In qualitative research, the credibility and validity of data collected will be tested using triangulation. Moleong (2012:330-331) stated four types of triangulation, nonetheless the triangulation of sources is the method chosen for this research. Triangulation of sources is done by comparing perspectives and opinions of multiple respondents of this research. RESULT AND DISCUSSION Internal Analysis There are four main points on internal analysis as explained below: 1. Human Resources Since Mahreen Collection discontinued its made-by-order customized service, extra hands of employees are not needed anymore. As of now, the total of human resource running the business in Mahreen Collection is only 2 persons, who are the owners (husband and wife).

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2. Marketing High quality products coming from the correct choice of qualified suppliers, raw materials, and up-to-date model are the key for Mahreen Collection to fulfill the customers’ demands. Mahreen Collection set relatively high prices for its high quality products. Its pricing strategy is based on the operational costs and the average market price. Its primary way of marketing is by using word-of-mouth (WOM) communication, where hopefully the satisfied customers will talk highly about Mahreen Collection as the most up-to-date fashion center in Krian. 3. Finance The beginning capital of Mahreen Collection came from the owners’ saving account. Meanwhile, due to its relatively small scale business, budgeting in Mahreen Collection is done in a straight and simple way without any particular approach involved. As for control and evaluation, the owners always make monthly financial statement. 4. Operational As of now, the current operational activities include selection of qualified suppliers, purchasing selected products from Jakarta and resell them in the boutique in Krian. Mahreen Collection only has limited supplies since fashion model change quickly. There are two drawbacks in Mahreen Collection, which are it relies much on the availability of suppliers in Jakarta and Mahreen Collection cannot be in full control of the quality of items produced. Table.1 Strengths and Weaknesses of Mahreen Collection Condition Notes Mahreen Collection only sells high quality products. Strength Quality control is always done for every purchase made from supplier. Strength Newest Model of Mahreen Collection always order goods directly from Jakarta to ensure it always up to date to current trend. Product Strength Supply of Goods Mahreen Collection uses more than 1 supplier to ensure its supply chain. Distribution channel is done only by using outlets. Weakness Distribution Channel Capital is limited because it is only funded from Weakness Capital owners’ money. Six years of establishment (2010-2016) has given Strength Experience Mahreen Collection a good amount of experience. Mahreen Collection doesn’t have employees. Weakness Human Everything is handled by its owner. Resource Financing is done manually with a simple accounting Weakness Finance book. Indicators Quality of Product

External Analysis External analysis is done using Porter’s Five Forces that will be developed into the opportunities and threats for Mahreen Collection. The result of Porter’s Five Forces is shown thru Figure.1 and explained in details as below: 1. Industry Rivalry: the rapid growth of interest in fashion brand and clothing nowadays results in huge number or rivals in fashion business. 2. Threat of New Entrants: the surge of new indie brand of clothing and the usage of internet marketing create many opportunities for new entrants to compete at fashion industry.

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3. Bargaining Power of Buyer: Mahreen boutique’s customers are very sensitive to price and quality. Even a small change can change their opinion and buying behavior, thus the customers determine the future of the boutique. 4. Threat of Substitutes: there is no substitute product for fashion since fashion always changes and adapts to the newest situation 5. Bargaining Power of Suppliers: there is almost none, since the number of suppliers are huge and there is no switching cost if Mahreen Collection want to change from one to other suppliers

Figure.1 Porter’s Five Forces Analyzing the results of Porter’s Five Forces, the opportunities and threats of Mahreen Collection are: Opportunities 1. High market demand: fashion products and clothing always improve every year with new trend and style 2. Increase in customer buying power: growth of fashion and clothing brand in Indonesia shows the increase in buying power 3. Style and brand: consumers want many styles and brand of clothing 4. Government policy: government gives more incentive for people who want to open new business, or categorized as SMEs (small and medium enterprises) Threats 1. Rivals: with many style and brands, it is inevitable to have many rivals competing in same line of fashion business 2. Bargaining power of customer: customers have the freedom to choose the style and brand of clothing that they want to buy, with minimal switching cost 3. Threat of new entrants: with the low barrier of entry and lucrative market, it is inevitable to have many new entrepreneurs trying to get some market shares in fashion business SWOT Analysis Knowing the strengths, weaknesses, opportunities, and threats, Mahreen Collection is now able to formulate SWOT strategies that can be used in its plan for business development, as depicted in Table.2 below.

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Table.2 Strategy Formulation based on SWOT Analysis Strength Weakness Internal - High quality products - Only 1 outlet for the distribution channel Factors - Newest trend products - Steady amount of supply - Limited capital - Experience in fashion business External - Limited availability of Factors human resource Opportunity S-O Strategy W-O Strategy - High market Growth Oriented Strategy Turnaround Strategy Company has strength and Company has a great demand opportunity to maximize any opportunity but is suffering - High customer opportunities available. The focus from internal problem. The buying power is to encourage aggressive policy. focus is minimizing any - Consumptive internal problems to get behavior better opportunities. - Government policy Threat S-T Strategy W-T Strategy - High number of Diversification Strategy Defensive Strategy Company is faced with many Company is faced with many rival threats but has good amount of threats and has weakness - High customer strengths. inside. The focus is to do bargaining power emergency action to avoid - High number of The focus is to use the strength to bigger loss. new entrants maximize long-term opportunity with diversification product or market strategy. In order to correctly pinpoint the most suitable strategy based on the four available strategy choices above, SWOT calculation as depicted in Table.3 was done. Table.3 SWOT Analysis Calculation Components Weight Rating Value Components Weight Rating Value STRENGTH (S) WEAKNESS (W) 0.30 3 0.90 Distribution 0.20 3 0.60 High quality channel product 0.30 4 1.20 Capital 0.30 3 0.90 Newest trend product 0.30 3 0.90 Human 0.37 3 1.11 Steady amount resources of supply 0.10 3 Experience in fashion business TOTAL 1.00 OPPORTUNITY (O) 0.30 4 Market demand 0.33 3 Customers’ buying power Consumptive

0.27

4

0.30

3.30

Finance

TOTAL

1.20

Rival

0.99

Customer bargaining power New entrants

1.08

0.13

3

0.39

1.00 THREAT (T) 0.33 4

3.00 1.32

0.39

4

1.56

0.28

2

0.56

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behavior of customer Government policy TOTAL

0.10 1.00

3

0.30 3.57

TOTAL

1.00

3.44

The result of SWOT calculation is converted into SWOT quadrant as depicted in Figure.2 to know whether Mahreen Collection falls into the first, second, third, or fourth quadrant. Opportunity (+) Y

Weakness (-)

(0,3 : 0,13) Mahreen Collection 1st Quadrant

Strength (+)

X

Threat (-)

Figure.2 Mahreen Collection in SWOT Quadrant

Mahreen Collection is at the first quadrant, which means that the most suitable strategy is the SO strategy that focuses more on aggressive policy to increase growth. Looking at the internal and external analysis, SWOT analysis, as well as strategy formulation and SWOT quadrant, there are definitely some changes needed to be applied for developing Mahreen Collection business. Table.4 below shows details of the managerial implication change before and after the aforementioned analyses. Table.4 Managerial Implication Old Condition New Condition Company only has one distribution Making new distribution channels by channel, which is the only outlet at opening new outlet(s) still in Krian region Parengan Street, Krian. in order to increase marketing scope Human resource management is not done With the plan of opening new outlet(s), yet because there is no employee. new employees will be hired, thus new human resource management policy will be implemented (i.e. recruitment requirements, salaries and compensation regulations, et cetera) Products available in the outlet are fashion Extra products available in the new product, such as clothes and dresses. outlet(s) will be beauty products, in

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Old Condition Word-of-mouth is the only marketing method commonly applied

New Condition addition to clothes and dresses. Social media accounts and company website will be made to increase marketing power. Financing will also include keeping tab on assets, stocks, debit and credit in addition to the old one.

Financing is done with a simple way, which is only keeping tab of income and spending, as well as products bought and sold. Operation aspect is done simply because With the addition of new outlet(s) and the owners manage the business directly. employees, a well-made Standard Operation Procedure (SOP) will be established.

CONCLUSION AND RECOMMENDATION Based on internal analysis, the strengths of Mahreen Collection are: (1) high quality fashion products; (2) newest model; (3) good availability of supplies; (4) experienced in fashion business. Meanwhile, the weaknesses are: (1) one outlet as distribution channel; (2) limited capital only from owners’ savings; (3) limited human resources. Based on external analysis, the opportunities are: (1) high deman for fashion products; (2) high customers’ buying power; (3) consumptive behavior of customers; (4) government regulation that boost SMEs. On the other hand, the threats are: (1) high number of rivals; (2) high customer bargaining power; (3) high threat from new entrants. Mahreen Collection is at the first quadrant, thus the suitable strategy is S-O which is growthoriented strategy. The focus of this strategy is to support activities that can boost growth aggressively, one of which is to add more outlets in Krian region. By adding outlets, then the demand will rise and therefore, Mahreen Collection has to add more suppliers so that the availability of supplies does not decrease. Moreover, this business development has to be evaluated closely so that the owners are able to take suitable decisions for the future of Mahreen Collection. REFERENCES Assauri, S. (2011). Manajemen Produksi Dan Operasi. Jakarta: Lembaga Penerbit Fakultas Ekonomi Universitas Indonesia Bateman, Thomas. S & Snell, Scott A. (2014). Manajemen: kepemimpinan dan kolaborasi dalam dunia yang kompetitif. Edisi ketujuh. Jakarta: Salemba Empat David, Fred R. (2012). Manajemen Strategis: Konsep. Jakarta: Salemba Empat Dirgantoro, Crown. (2011). Manajemen stratejik: konsep, kasus, dan implementasi. Jakarta: Grasindo Jeyaraj, K.L., Muralidharan, C., Senthilvelan, T., Deshmukh, G. (2012). Application of SWOT and Principal Component Analysis in a Textile Company - A Case Study. International Journal of Engineering Research and Development, Volume 1 (9), June 2012, pp. 46-54 Joen, K.T., Praptiningsih, M. (2013). Deskripsi Pengelolaan Dan Pengembangan Usaha Modes Mbak Soem Di Surabaya. Agora, Vol. 1 (1), 2013 Lamb, C.W., Hair, J.F., Mc. Daniel, J.C. (2015). Marketing. Boston: Cengage Learning Moleong, L.J. (2012). Metodologi Penelitian Kualitatif. Bandung: Remaja Rosdakarya Muchtar, A.F. (2010). Strategi Memenangkan Persaingan Usaha Dengan Menyusun Business Plan. Jakarta: PT. Elex Media Komputindo. Nugroho, R. (2010). Perencanaan Strategies in Action. Jakarta: Elex Media Komputindo

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Pearce, John A; Robinson, Richard B. (2013). Manajemen strategis: formulasi, implementasi, dan pengendalian. Jakarta: Salemba Empat Pophal, L. (2014). The Everything Guide To Customer Engagement. Massachusetts: Adam Media Shooshinasab, P., Taylor, T., Moeinfard, M., Kazemnejad, A. (2013). Strategic Planning for Development of Sport Events Tourism Industry in Iran. International Journal of Sport Studies, Vol., 3 (12), 2013, pp. 1348-1361 Suharyadi., Nugroho.A., Purwanto, S.K., Faturohman, M. (2011). Kewirausahaan, membangun usaha sukses sejak usia muda. Jakarta: Salemba Empat. Yoanita, M., Wandebori, H. (2013). Strategy Formulation And Implementaion For PT. Multigarmen Jaya. The Indonesian Journal Of Business Administration, Vol . 2, No. 13, 2013:1627-1636

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INNOVATION FOR HYPE LEATHER Sheila Vania Winata, 2Tina Melinda♠

1

Ciputra University Surabaya INDONESIA Email: [email protected], [email protected] ABSTRACT Hype Leather is a fashion company which produces leather clutch. Hype Leather’s selling method is by online selling. Hype Leather sales have declined lately. Products of Hype Leather are less varied than competitors’ product. Hype Leather’s products also have no uniqueness that distinguish competitors’ product, while customers prefer alternating models and feel embarased when they use same goods with others. Innovation is needed by Hype Leather to create better products, so it can compete with existing competitors. This study aims to develop innovation for Hype Leather, so that the sales turnover can be increased. This research is a qualitative research. Purposive sampling is used to select the informants based on the criteria related the research problem. The six study informants are owner of Hype Leather (one person), fashion expert (one person), marketing expert (one person), and customers of Hype Leather (three people). Interview, observation and documentation are used as data collection methods in this research. This study also uses Business Model Canvas (BMC) and Blue Ocean Strategy (BOS) approach. The outcomes of this study include the innovation that can be implemented to Hype Leather. Keywords: Fashion business, Innovation, Business Model Canvas (BMC), Blue Ocean Strategy (BOS) INTRODUCTION Talking about creative industry has no ending because it always has progress. According to the Minister of Industry, Saleh Husin, fashion and handicraft are the sub-sectors that contribute greatly to the national economic growth. The Ministry of Industry also continues to encourage the development of national creative industry so that its growth can be increased by around 7% per year (www.kemenperin.go.id, August 2015). Textile, leather and footwear manufacturing sectors will continually expand from 2015 and are expected to be achieved by 2035. Growth of textile, leather and footwear industries are indicative of great opportunity for the industry, but companies in this industries also have greater challenges as competiton becomes more stringent (www.kemenperin.go.id, August 2015). Hype Leather is a business in creative industry, which established in 2015. Products of Hype Leather are fashion products made from leather. The main product of Hype Leather is leather clutch. The product types are still not varied, but Hype Leather uses vary skin motifs like snake skin pattern, crocodile skin pattern, orange skin pattern, saffiano leather, etc. Current selling method is by using social media (Instagram and Kaskus), then the sales systems are ready-stock and pre-order. Hype Leather sales initially had a positive trend. Sales increased during the first quarter of 2016, but in the second quarter of 2016 Hype Leather sales declined significantly, while the

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creative industry is projected to increase according to the Minister of Industry as described previously. The sales chart of Hype Leather is quite volatile and has no significant increase in recent months, even the sales trend tends to decline. This problem can be caused by the number of competitors that sell similar products, so that the competition gets tighter both in terms of products and price offered. The product variants of Hype Leather is currently fewer than competitors’. The more the product varies, the greater opportunity to obtain greater sales. Customers will not bored with the products offered and the company can fulfill customers’ needs according to their different tastes. Competitors regularly launch new models and skin types as their strategy in order to repeat orders from customers. Hype Leather’s products currently do not have the uniqueness that can differentiate with competitors’, whereas the price offered is almost the same. Based on the article on www.kompasiana.com (2013) which states that Indonesian people have a tendency to be ashamed to use general goods that impressed not exclusive, expecially for women. Most women will feel embarrassed if they use same stuff with other people. From that case, it is very important for Hype Leather to innovate the products so that Hype Leather can offer different product than competitors. Hype Leather also need to add the channels because Hype Leather only sell products by online shop today, while competitors have many channels. It is hoped that Hype Leather sales will increase as more channels are available to deliver products to customers. This research will discuss the innovation for Hype Leather using Business Model Canvas (BMC) and Blue Ocean Strategy (BOS) as analyze method. The purpose is to determine the appropriate innovation for Hype Leather in competing with existing competitors. Innovation is needed by every company because innovation is an important instrument for entrepreneurs in building and creating creative value-added in every business. LITERATURE REVIEW Business Model Canvas (BMC) Business Model Canvas (Osterwalder and Pigneur, 2015) is a media for describing, visualizing, valuing and changing business models. There are 9 main components in Business Model Canvas which separated by 2 sides, the right side (creative) and the left side (logic) according to the division of the human brain. The components are customer segments, value propositions, channels, customer relationships, revenue streams, key resources, key activities, key partnerships, and cost structure. Blue Ocean Strategy (BOS) Blue Ocean Strategy (BOS) invites companies to get out from the red ocean where there are many similar competitors by creating new market that there is not much competitors. In Blue Ocean Strategy, demand is not contested in competition but to be created (Hardi and Mustamu, 2015). Rapid technological advances have increased productivity and enabled producers to produce more kinds of products or services, which could create blue ocean (Kim and Mauborgne, 2014). In Read Ocean, companies approach conventionally by competing to win the competition on the existing industry. Companies in blue ocean do not compete but innovate by creating value (Kim and Mauborgn, 2014). Blue Ocean Strategy has three analytical tools (Septarini and Kusumadmo, 2014), they are Strategy Canvas, Four Actions Framework, and Eliminate-Reduce-Raise-Create (ERRC) Scheme. Four Actions Framework helps companies in constructing buyer value in creating new value curves (Septarini and Kusumadmo, 2014). Four Actions Framework has four main questions: (1) which factors must be raised within an industry in terms of product, pricing or service standards; (2) which areas of a company or industry could be completely eliminated to reduce costs and to create an entirely new market; (3) which areas of a company’s product or

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service are not entirely necessary but play a significant role in your industry, for example, the cost of manufacturing a certain material for a product could be reduced; (4) which factors have not been offered by the industry so that it must be created. After the questions answered, the next step is Eliminate-Reduce-Raise-Create Scheme which encourages companies to execute based on four questions in Four Actions Framework (Kim and Mauborgne, 2014). RESEARCH METODS This research is a qualitative research. According to Sugiyono’s statement (2014), qualitative research becomes instrument in the research itself so that researchers also must be validated about the readiness in doing the research. The study informant is individual who is tasked to provide information relating to culture, social structure, beliefs, and other things that are useful for research (Herdiansyah, 2012). The criteria of the informants are as follows: 1) Owner of Hype Leather who understand the company’s operations (1 person) 2) Fashion expert (1 person) 3) Marketing expert (1 person) 4) Customers who have purchased Hype Leather products once or more (3 people) This research will be done in three months from February to April in Surabaya and surrounding area. Interview is used as data collection method in this research. Accorrding to Bungin’s statement (2013), interview is a method to obtain information by talking face to face and discussing Q&A directly between the interviewer and speakers, using or without using guidelines. This study uses semi-structured interview method to enable researchers in finding information more openly and profoundly (Esteberg in Sugiyono, 2014). This study also uses documentation method that records a person or group of people, events in appropriate social conditions and related to the research topic (Joseph, 2014). Source triangulation is used as data validation using various data sources, such as documentation and interview results by interviewing more than one informant who have different point of view and fulfill specified criteria. RESULTS AND DISCUSSION Business Model Canvas (BMC) Data Collection Here is an overview of the recent business model of Hype Leather based on nine components obtained from interview with informants IS as the owner of Hype Leather.

Figure 1

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Strategy Canvas The interview results to the informants show nine factors to determine the success of a company in fashion industry, especially bags. These nine factors consist of price, product type, customized, product uniqueness, brand awareness, product quality, service, channels and tradein. Here are the results obtained from interviews to informants: a. Price The price of Hype Leather’s products is clearly lower than the price of competitor A’s products. The price range of Hype Leather’s products starts from Rp. 100.000,- while the price range of competitor A’s products starts from Rp. 150.000,b. Product type Type of Hype Leather’s products is less than competitor A’s product. Hype Leather’s product currently is only clutch while competitor A has other type besides clutch, such as card holder and tote bag. c. Customized Hype Leather serves customized products or according to customers’ request. This is not done by competitor A. Competitor A only sell available models and do not serve special model or size request from customers. d. Product uniqueness Hype Leather’s products currently do not have uniqueness that differentiates with competitor A’ products. Hype Leather’s products have no characteristic yet. e. Brand awareness Hype Leather has better brand awareness than competitors becaus Hype Leather’s brand define the meaning clearly and motivate customers to buy its products. The word “leather” shows that Hype Leather sells leather goods, while the word “hype” shows that the products make its users become trend setter. Competitor A does not have those things, but their brand is more easily to be remembered by customers because they have been existing longer and actively doing promotions and exhibitions. f. Product quality The quality of Hype Leather’s products is currently lower than competitors. In terms of durability, Hype Leather’s products are as durable as competitors’ but competitors’ product design is more diverse that Hype Leather’s products. g. Service The service provided by Hype Leather is better than competitors’. Hype Leather responds the chats from customers quickly and provides friendly sevice, but competitor A has more product knowledge than Hype Leather. h. Channels Competitor A has more channels than Hype Leather. Hype Leather currently only sells products through online shop and has not focused on market place, while competitor A sells their products through media social, market place and exhibitions. i. Trade-in This system has not been done either by Hype Leather nor competitor A. Other companies have implemented this trade-in system, but none of them comes from bag industry.

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Figure 2

Four Actions Framework Here are the factors that should be eliminate, reduce, raise and create. a. Factors to be eliminated Overall, the researcher do not find any factor to be eliminated. From the interview and observation results, the eight factors described previously are important factors in the competition of fashion industry. Those factors are required by customers to be owned by the company, so they cannot be eliminated. b. Factors to be reduced Customized is the factor that should be reduced. Customized product should be reduced in terms of quota by considering that customized product requires more effort, while the price of Hype Leather’s products is not expensive. Customized product cannot be eliminated because it can be an advantage for Hype Leather that is not owned by competitors. Hype Leather will serve customized order with terms and conditions (example : there is minimum order amount for customized product). c. Factors to be raised There are several factors that need to be raised based on interview results. The first factor is channels. Hype Leather currently sells its products through online shop, so customers are not able to see or touch Hype Leather’s products directly. Some customers want to buy a product if they ever see or touch the product directly before they purchase it, then they will not hesitate to buy online on the next time. Hype Leather needs to join some exhibitions in the future. Exhibition will help HypeLeather to establish better relationship with customers because Hype Leather can interact with customers directly, besides customers also can see the display of Hype Leather’s products. Resellers are also needed by Hype Leather to increase sales. Online selling through social media is not enough for Hype Leather, so that the products should be sold through market place too. The second factor is product type. Customers prefer to shop in stores that sell varied types of products, both in terms of model, size, color and so on. Current product type offered by Hype Leather is only clutch, so it is necessary for Hype Leather to increase product type such as card holder, passport holder, bad and wallet. The third factor is service. The service that is provided by Hype Leather is better than competitor’s because Hype Leather serves quick and friendly response to customers, but Hype Leather’s product knowledge is less than competitors’. Product knowledge is an important indicator in service, especially in fashion business, in order to communicate with customers clearly. It also can give good advice customers. The fourth factor is brand awareness. Hype Leather’s brand has fulfilled two indicators. It has clear message and motivation for customers, but it is not remembered by customers easily.

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Hype Leather’s brand is a new brand, so it is not known by the public yet. Hype Leathers should join many exhibitions in order to promote the brand. In addition, Hype Leather also should add brand on its products to be more visible to customers. The next factor that should be raised is product quality. Hype Leather’s products are as durable as competitors’, but product design of competitors’ is better. Hype Leather should improve the design of products to be more trendy. The last factor is product uniqueness. Based on the interview results, Hype Leather’s products currently have no uniqueness. Hype Leather’s products do not have differences with competitors’. Hype Leather should create a product signature in the future by adding certain attributes so that it can be Hype Leather’s characteristics. d. Factors to be created Factor that should be created in Hype Leather is trade-in system. This transaction system can be implemented by Hype Leather as an innovation in fashion industry, especially bags because it can build customers’ loyalty to Hype Leather’s brand. Hype Leather’s products belong to fast fashion products, where the trend turns very fast. It makes customers feel bored with their old stuffs quickly and want to replace them with the new ones. Trade-in system helps customers to exchange their old clutch with the new models. This kind of transaction is already implemented by electronic or vehicle companies. Companies usually earn greater profit from trade-in system because sales of used products is more profitable than the sales of new products. Used products can be repaired and modified in such way as to be sold again with more attractive appearance and atribute. In addition to profiy, companies also can strengthen their brand in market. If their brands are already strong, it is expected that the customers can be more loyal due to the provided service. Eliminate-Reduce-Raise-Create Scheme Based on the Four Actions Framework analysis results, here is the Eliminate-Reduce-RaiseCreate Scheme that can be set up. Table 1 Eliminate Raise  Channels  Product type  Service  Brand awareness  Product quality  Product uniqueness Reduce Create  Customized  Trade-in Based on the Eliminate-Reduce-Raise-Create Scheme above, then the new strategy canvas can be formed as follows.

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Figure 3 The scheme above shows some similarities and differences between the graphs depicted before and after the Eliminate-Reduce-Raise-Create made. The equation is in the price. The price remains the same, that is above the competitors’ price because the price offered by Hype Leather is better than competitors’. Hype Leather does not need to do more price competition, but Hype Leather should increase other factors to make the price worthy to be paid by customers. Differences are seen on several factors. The first factor is product type. The product type is higher than the previous and it is expected to exceed competitors because consumers prefer to buy varied products in stores. Varied products also help the companies to gain customers’ loyalty because customers do not bored with provided products. The second factor is customized. This factor is lower than before because customized product quotas will be reduced in the future. Customized products can be advantage and also disadvantage for company that has middle to lower market segmentation. The disadvantage is that the cost can be swollen if the company receives too many customized orders without minimum order, besides it can be advantage if customized orders are received with terms and conditions (with minimum order) so that it can be opportunity for company to obtain larger turnover. The next factor is product uniqueness. This factor has to be increased because Hype Leather does not have uniqueness on its products. Hype Leather should add signature on the products that can differentiate with competitors’ products. Differences also occur on brand awareness. This factor also should be increased so that Hype Leather position can be higher than competitors. Hype Leather should do more product promotions. There is also difference on product quality. This factor should be increased because Hype Leather position is lower than competitors. Competitors’ products design is better than Hype Leather, they also have more varied product design. Hype Leather should improve its design in the future to be better than competitors. The next difference is on service. Hype Leather’s service is already better than competitors, but the service still needs to be improve in terms of product knowledge. Hype Leather serves customers with fast response and more friendly that competitors, but not in product knowledge. Hype Leather has less product knowledge than competitors, so it needs to be improved in order to provide maximum customer satisfaction. There is difference on channels too. Current channel of Hype Leather is only online store, whereas competitors have more channels than Hype Leather. Therefore, Hype Leather should have more channels (increase from one channel to three channels at least). The channels that should be used by Hype Leather are online (social media and market place), exhibitons and resellers. Increasing number of Hype Leather’s channels is expected to increase the sales turnover.

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The last difference is seen on trade-in section, where there is only Hype Leather’s line on the new strategy. It shows that this factor is a new innovation and not owned by competitors. This factor is a key for Hype Leather to enter the blue ocean. The implementation of trade-in system is expected to build customer loyalty, as well as Hype Leather’s brand. REFFERENCES Bungin, B. (2013). Social & Economic Research Methodology: Quantitative and Qualitative Formats for Sociology, Public Policy, Communications, Management and Marketing Studies. Jakarta: Kencana. Hardi, K., & Mustamu, R. (2015). Formulation of Blue Ocean Strategy at Shoe Company in Pasuruan. Agora, Vol. 3, 1-6. Hartono. (2015, August). Ministry of Industry of the Republic of Indonesia. Retrieved from www.kemenperin.go.id: http://www.kemenperin.go.id/artikel/12797/Menperin:Industri-Kreatif-Tumbuh-7-Per-Tahun Herdiansyah, H. (2012). Qualitative Research Methodology. Jakarta: Salemba Humanika. Osterwalder, A., & Pigneur, R. (2015). Business Model Generation. Jakarta: PT. Elex Media Komputindo. Kim, W., & Mauborgne, R. (2014). Blue Ocean Strategy. Jakarta: PT. Serambi Ilmu Semesta. Priyono, A., & Susilowati, C. (2014). Strategic Planning using the Blue Ocean Strategy Approach. Student Scientific Journal FEB, Vol. 1, 1-22. Septarini, E., & Kusumadmo, E. (2014). Formulation of Kt-gongsin Blue Ocean Strategy. Journal of Master in Management, Vol. 18, 1-13. Sugiyono. (2014). Quantitative Educational Research Methods, Qualitative And R & D. Bandung: Alfabeta. Yusuf, M. (2014). Research Methods: Quantitative, Qualitative and Joint Research. Jakarta: Prenada Media Group.

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FACTORS THAT ENCOURAGE DECISION TO BECOME A HYBRID ENTREPRENEUR Junko Alessandro Effendy, 2Thomas Stefanus Kaihatu♠

1

Ciputra University, Surabaya INDONESIA Email: [email protected] [email protected]

ABSTRACT The purpose of this research is to search the factors that encourage decision to be a hybrid entrepreneur. Respondents of this research are 97 hybrid entrepreneurs in Surabaya City. This research used quantitative approach through the second order confirmatory factor analysis methods. The content of the questionnaires are made based by indicators of seven variables which is estimated as encourage factors to become a hybrid entrepreneur. Variable which is used are motivation for self-development, sense of security, passion, experience, family and environment. The result of this research shows that all variables which are used in this research are factors that encourage decision of hybrid entrepreneurs in Surabaya City. The result of this research also strengthen some research and theories that are used as base in this research. Also, those seven factors reflect the decision of the researcher to become a hybrid entrepreneur too. Keywords : Hybrid entrepreneur, Self-development, Experience, Sense of security. Environments

INTRODUCTION Entrepreneur is also a profession which are believed can fix and bring positive impacts to the economical sectors of a nation. Through entrepreneurship, there are many open employments that can minimalize the unemployed. Based on the fact which are said by Kodrat and Christina (2015:5), a country with a good economical sectors must have at least 2% entrepreneurs from their total population in that country. Countries like USA, China, India and Singapore have entrepreneurs above 2% of their total population. Surabaya is the second biggest city in Indonesia which have a significant growth of entrepreneurs. This are proofed from the data from Event Surabaya that sees Small-Medium Enterprises tend to grow followed by the numbers of bazaars which are growing in Surabaya. Entrepreneurs in Surabaya moves from many kinds of industries like food and beverages, fashions, services, manufactures, creative industries and much more. There are many vessels for Small-Medium Enterprises to introduce their business to the wide community. The majorities are bazaars which are held each week in many places of Surabaya. The researcher has done his pre-survey to 50 entrepreneurs about backgrounds of their jobs while doing their business. Table 1 is the job background comparison of entrepreneurs in Surabaya.

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Hybrid Entrepreneur 26 people (52%)

Tablel 1. Pre-Survey of entrepreneurs in Surabaya Part-time Family Business Full-time Entrepreneur Entrepreneur 12 people (24%) 8 people (16%) 4 people (8%)

Source: Data is processed Through Table 1, can be concluded that there are many entrepreneurs in Surabaya who start their career by choosing to become a hybrid entrepreneur. Hybrid entrepreneurs are persons who start their entrepreneurship career by previously becoming an employee to save money and learn so they can applicate it when they had already been an entrepreneur (Folta 2010). The result of the pre-survey done by the researcher is supported by a research done by Burke et al (2008) in Folta Research (2010) where the quantities of entrepreneurs who starts their career by previously becoming an employee are much larger than those who start as entrepreneur directly. In this research, the researcher wants to investigate the factors encouraging decisions to become a hybrid entrepreneur. LITERATURE REVIEW Entrepreneur According to Casson in Wahyudi (2012), entrepreneur is someone who execute their expertise by making a decision different from others to utilize resource so they can prosper more than before. According to Joewono (2013), entrepreneur is someone who is passionate to develop new business by utilizing resources around them so they can prosper more. Based on those theories, it can be concluded that an entrepreneur is someone who can utilize resource among them to be used as something useful. Hybrid Entrepreneur Joy (2009) said that hybrid entrepreneur is someone who combines two kinds of jobs which is an entrepreneur and an employee for a purpose to develop business stably on the future. According to Folta et al (2010), hybrid entrepreneur is someone who works as an employee in another firm to learn and save money to stabilize the business which he/she builds at the same time. When hybrid entrepreneurs had assumed that their business had stabled, then he will stop working as an employee. The main point of hybrid entrepreneur from these theories is someone who does 2 jobs at the same time, which is entrepreneur and employee at the same time. The main purpose is to stabilize the business they develop. If it is assumed that it has been stabilized, their work as an employee will be abandoned. According to Folta et al (2010), there are some benefits to become a hybrid entrepreneur compared to become a normal entrepreneur 1. There are an additional income because a hybrid entrepreneur starts as an employee first 2. A way to save money to start, develop and stabilize business 3.A safer way to start a business because a hybrid entrepreneur can learn and gain experiences when he/she works as an employee

4. A way to gain more business relations Research Variables The researcher uses seven variable which is motivation, self-development, sense of security, passion, family, experience and environment. These seven variables are taken from the result of the earlier researches that are connected to this research.

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Table 2 Result of Findings from the Previous Research Researcher Name Result of Findings Hammarstrom dan Nylen (2014), Raffie dan Feng (2013) Norstrom et al. (2016) Indudewi (2015) Thorgren et al (2014) Koranti (2013)

Experience, self-development and environment factors Motivation, family, self-development and sense of security factors Passion and environment factors Experience, passion, environment and family factors Motivation, passion, environment and family factors Motivation and family factors

Source: Data is processed by Koranti (2013), Raffie and Feng (2013), Hammarstrom and Nylen (2014), Indudewei (2015), Thorgen et al (2014), Nordstrom et al (2016 RESEARCH METHODS This research uses quantitative approach. Quantitative researches are researches that are based systematically, planned, structured and number oriented (Sugiyono 2012). According to Grove et al (2015), in quantitative research there can be a probability sampling technique and also nonprobability sampling. This research uses non-probability purposive sampling method. Population Population is the whole research object or called as universe (Purwanto, 2012). The population of this research are the whole hybrid entrepreneur in Surabaya which are not known it’s exact number. Sample Sample is a part or representative of the population that are researched that is appropriated by the researcher (Bungin, 2015). According to Rao Purba in Aprilia and Ghozali (2013), to determine the population of unknown exact number, then the following formula is used. n=

Z2 4 x (Moe)2

n=

1.962 4 x (0,1)2

= 96,04

Based from the formula, the sample of this research are 97 hybrid entrepreneurs from Surabaya city Data Analysis Method This research uses second order confirmatory factor analysis method by using SMARTPLS-3 software. According to Latan and Gozali (2012), this method is used through 2 steps. The first step is done by testing latent construct dimension to the indicator. The second step is testing latent construct to construct dimension. This technique is used first through indicators in the dimension. The purpose of second order confirmatory factor analysis is to reduce variables to a lesser quantities so it can be known which variables have the outmost part. Validity Test

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According to Abdillah and Jogiyanto (2015), to do the second order confirmatory factor analysis validity test that uses SMARTPLS-3 software, there are some tests which must be done, which are loading factor and cross loading with the recommended score above 0,70 also Extracted Variance Average test with the recommended score above 0,50. Reliability Test According to Abdillah and Jogiyanto (2015), to do the second order confirmatory factor analysis reliability test that uses SMARTPLS-3 software, there are two tests which must be done, which is cronbach alpha and composite reliability test with the recommended score above 0,70. DATA ANALYSIS AND DISCUSSION Validity Test Validity test for second order confirmatory factor analysis have three test which are loading factor validity test where indicators must be above 0,70. Second is AVE test where all variables must be above 0,50. Third is cross loading test where all variables must be above 0,70 and indicators in the according variable have the biggest score compared to the other variables. Table 3, 4, 5 are the validity test. Table 3 Loading Factor Validity Test

VARIABLE Motivation (X1)

Self -Development(X2)

Sense of Security (X3)

Passion (X4)

Experience (X5)

Family (X6)

Environment (X7)

INDICATOR

SCORE

STATUS

Own desire (X1.1) Interested (X1.2) Feel Competent (X1.3) Development of Knowledge (X2.1) Skill Development (X2.2) Channel Development (X2.3) Financial (X3.1) Knowledge (X3.2) Skill (X3.2) Feeling Comfortable (X4.1) Feeling Undepressed (X4.2) Feeling Happy (X4.3) Failure (X5.1) Success (X5.2) Experience Searcher (X5.3) Family Judgement (X6.1) Family Information (X6.2) Family Experience (X6.3) Similarity From Friends (X7.1) Similarity From Family (X7.2) Similarity from Partner (X7.3)

0,927 0,929 0,822 0,956 0,967 0,929 0,967 0,859 0,967 0,906 0,888 0,826 0,850 0,968 0,964 0,951 0,948 0,911 0,863 0,975 0,977

Accepted Accepted Accepted Accepted Accepted Accepted Accepted Accepted Accepted Accepted Accepted Accepted Accepted Accepted Accepted Accepted Accepted Accepted Accepted Accepted Accepted

Source: Data is processed by SMARTPLS-3 Based on Table 3, it can be seen that all indicators have scores above 0,70 for outer loading validity test. So it can be concluded as a valid indicators.

Table 4. Score of Average Variance Extracted

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VARIABLE SCORE Motivation (X1) 0,799 Self-Development (X2) 0,903 Sense of Security (X3) 0,870 Passion (X4) 0,764 Experience (X5) 0,863 Family (X6) 0,878 Environment (X7) 0,883 Hybrid entrepreneur decision 0,512 Source: Data is Processed by SMARTPLS-3

STATUS Accepted Accepted Accepted Accepted Accepted Accepted Accepted Accepted

Based on Table 4, it can be seen that all variables have scores above 0,50 for average variance extracted (AVE) validity test. So, it can be concluded as a valid variables. Table 5. Cross Loading Validity Test

Source: Data is processed by SMARTPLS-3 Based on Table 5, it can be said that all variables and indicators exceeds the determined minimum number so it can be concluded that all variables and indicators are valid.

Reliability Test Table 6. Cronbach Alpha Test VARIABLE SCORE Motivation (X1) Self-Development (X2) Sense of Security (X3) Passion (X4) Experience (X5) Family (X6) Environment (X7)

0,873 0,946 0,923 0,845 0,919 0,930 0,932

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Hybrid entrepreneur Decision Source: Data is processed by SMARTPLS-3

0,952

Table 7. Composite Reliability test

VARIABLE

SCORE

Motivation (X1) Self-Development (X2) Sense of Security (X3) Passion (X4) Experience (X5) Family (X6) Environment (X7) Hybrid entrepreneur decision

0,923 0,966 0,952 0,907 0,950 0,956 0,958 0,956

Source: Data is processed by SMARTPLS-3 According to Abdillah and Jogiyanto (2015:196), the recommended score for the composite reliability test and Cronbach alpha is above 0,70. Based on Table 6 and Table 7, it can be seen that all variables have scores above 0,70, so the variable in this research is concluded reliable. Hypothesis Test for First Order Construct The Hypothesis test on the outer loading is done by seeing the score of T-statistics after doing the bootstrap method. According to Abdillah and Jogiyanto (2015:198), hypothesis is accepted if the variable have score above 1,96. Table 8, shows the T-statistics score of each indicators

INDICATOR

Table 8. Outer Loading T-Statistics Score T-STATISTICS INDICATOR

X1.1 <- motivation X1.2 <- motivation X1.3 <- motivation X2.1 <- self-development X2.2 <- self-development X2.3 <- self-development X3.1 <- sense of security X3.2 <- sense of security X3.3 <- sense of security X4.1 <- passion X4.2 <- passion X4.3 <- passion

50,058 35,149 11,350 54,766 63,775 17,450 92,599 12,558 91,536 27,836 19,103 16,944

X5.1 <- experience X5.2 <- experience X5.3 <- experience X6.1 <- family X6.2 <- family X6.3 <- family X7.1 <- family X7.2 <- family X7.3 <- family

T-STATISTICS 16,316 93,943 75,237 77,280 73,218 39.143 21,405 188,675 209,376

Source: Data is processed by SMARTPLS-3 Based on Table 8, it can be seen that all indicators have scores above 1,96 to latent variable, because of that all the indicators are accepted.

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Second Order Construct Second phase test is done to reflective latent variable by seeing hypothesis test by seeing the t-statistics score. Table 9. Inner Model T-Statistics Score VARIABLE SCORE Motivation (X1) Self-Development (X2) Sense of Security (X3) Passion (X4) Experience (X5) Family (X6) Environment (X7) Source: Data is processed by SMARTPLS-3

6,307 10,099 7,605 6,362 6,371 6,248 8,125

Based on Table 9, it can be seen that all variables in this research have T-Statistic scores above 1,96, meaning that the first hypothesis is accepted and all variables used in this research significantly reflects the decisions of the citizens of Surabaya to become a hybrid entrepreneur. Discussion Based on the respondent’s answers and the processed data, motivation, selfdevelopment, sense of security, passion, experience, family and environment are factors encouraging decisions to become a hybrid entrepreneur. Hybrid entrepreneur is a way or alternative for someone who wants to become an entrepreneur so they can learn and save money first (Folta,2010). Motivation is needed on decision making because it will become a self-encouragement method of hybrid entrepreneurs. (Chinnunda and Emmanuel, 2014). “Interested” indicator is one of the important part, because hybrid entrepreneurs can learn, learn many experiences. Second factor is “self-improvement”. Self-improvement is also an important factor so that hybrid entrepreneur are really ready when they open their business. This is supported by the research by Raffie and Feng (2013) who state that self-development are an important factor for someone who develops business. Skills, experiences and also relations are important when executing business. The third factor is a sense of security. Basically, lots of people psychologically prevent risks because they feel insecure (Suryabrata, 2011). There are many entrepreneurs who experienced obstacles especially in their financial when developing business (Indudewi, 2015). Because of that, becoming an employee first can give some chance to save money first. The fourth factor is passion. Psychologically, someone can be called passionate with their activities when the are happy, calm and not feeling pressed by that activity (Suharti and Sirine, 2011). Respondents in this research are happy when they become a hybrid entrepreneur because there are many benefits they gain for the future. The next factor is experience and family. These factors are linked each other. Family experiences and information are an important part of decision-making process (Uygun and Kasimoglu, 2013). Family is also an external motivation that can help to reconsider the answer of decisionsmaking. The last factor is the environment. It cannot be denied that the decisions of hybrid entrepreneur is based on the desire to follow the paths of others, maybe it is friends, family or even partners. These seven variables are used in this research to complete each other and aid the decision-making process to become a hybrid entrepreneur. CONCLUSION AND SUGGESTION

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Conclusion The result of the research shows that motivation, self-development, sense of security, passion, environment, family and experience encourage student to become a hybrid entrepreneur. Suggestion Based on the result of the data process and discussion in this research, there are some following suggestions: 1. In the next research, researchers can use qualitative method by doing interviews so they can create in depth answer. 2. In the next research, researchers can consider using different population so they can create a comparison of factors encouraging to become a hybrid entrepreneur.

REFERENCES Abdillah, W & Jogiyanto. (2015). Partial Least Square: Alternatif Structural Equation Modelling. Yogyakarta. Penerbit Andi Aprilia, K & Imam, G. (2013). Generalized Structured Component Analysis. Semarang. Badan Penerbit Universitas Diponegoro Bangun, W. (2012). Manajemen Sumber Daya Manusia. Jakarta. Penerbit Erlangga. Bungin, B. (2015). Metode Penelitian Kuantitatif. Jakarta. Kencana Chinunda & Emmanuel. (2014). The Attitude Success. Houston. Strategic Book Publishing and Rights. Co Folta, T. (2010). Hybrid Entrepreneurship. Management Science, Grove, S. (2015). Study Guide For Understanding Nursing Research Building : An EvidenceBased Practice. Missouri. Elsevier Hammastrom, N & Viktor, N. (2014). Pursuing Hybrid Entrepreneurship in Academia. UMEA University:Journal of Economic and Business. Indudewi, F,Y,R. (2015). Success Factors of Hybrid Entrepreneurs: Case Study Of Universitas Ciputra Academician. Mediterannian Journal Of Social Sciences. Volume 6, No 5. Joewono, H. (2013). The 5 Arrows of New Business Creation and Entrepreneurship. Jakarta. Penerbit Arrbey Joy, F. (2009). Hybrid Entrepreneurship. Georgia. Joy Group International Publishing Kodrat, D.S. & Wina C. (2015). Entrepreneurship: Sebuah Ilmu. Jakarta. Penerbit Erlangga Koranti, K. (2013). Analisis Pengaruh Faktor Eksternal dan Internal Terhadap Minat Berwirausaha. Proceeding PESAT. Latan, H & Imam Ghozali. (2012). Partial Least Squares. Semarang. Badan Penerbit Universitas Diponegoro Martono, N. (2011). Metode Penelitian Kuantitatif : Analisis Isi dan Data. Jakarta. PT Rajagrafindo Perkasa Nordström, C. (2016). Passion in hybrid entrepreneurship: the impact of entrepreneurial teams and tenure.Baltic Journal of Management, 11(2), 167-186. Purwanto. (2012). Metode Penelitian Kuantitatif Untuk Psikologi dan Pendidikan. Yogyakarta. Pustaka Pelajar Raffiee & Feng (2012). Should I Quit My Day Job? A Hybrid Way To Entrepreneurship. University of Wisconsin-Madison : Academy of Management Journal. Sugiyono. (2012). Metode Penelitian Kuantitatif Kualitatif dan R&D. Bandung. CV Alfabeta Suharti & Sirine. (2011). Faktor-Faktor yang Berpengaruh Terhadap Minat Kewirausahaan. Jurnal Manajemen dan Kewirausahaan Suryabrata, S. (2011). Psikologi Kepribadian. Jakarta. PT Rajagrafindo Persada. Thorgren, S. (2014). Hybrid Entrepreneurship: The Importance Of Passion. Baltic Journal Of Management.

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Uygun & Kasimoglu. (2013). The Emergence of Entrepreneurial Intentions in Indigenous Entrepreneurs: The Role of Personal Background on the Antecedents of Intentions. Journal of Business and Management Wahyudi, S. (2012). Entrepreneurial Branding and Selling: Roadmap Menjadi Entrepreneur Sejati. Yogyakarta. Graha Ilmu

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THE ANALYSIS OF BUSINESS DEVELOPMENT STRATEGIES IN ESA FARMA PHARMACY 1

Putro Bagus Sulistyo, 2David Sukardi Kodrat♠ Ciputra University Surabaya INDONESIA Email: [email protected] 2 [email protected]@gmail.com ABSTRACT

Pharmacy is one business service products and services associated with customer satisfaction. Pharmacy Esa Farma is a business in the field of public health services. Esa Farma Pharmacy has undergone turnover from October 2015 to September 2016. Esa Farma needs to develop strategies to improve the business. This involves internal and external factors. This study aims to (1) identify and analyze internal and external factors of Esa Farma Pharmacy, and (2) formulate development strategies for Esa Farma Pharmacy and determine primary strategies that can be implemented. Identifying the strengths and weaknesses was to employ the Internal Factor Evaluation (IFE) matrix; meanwhile, the External Factor Evaluation (EFE) matrix was used to identify opportunities and threats. SWOT Analysis (Strengths, Weaknesses, Opportunities, and Threats) was used to formulate alternative strategies. Quantitative Strategic Planning Matrix (QSPM) was used to develop primary strategies. Based on the calculation of IFE matrix and EFE matrix, total score of 2.53 and 2.91 were obtained. This showed the focus of strategy was to minimize internal problems in order to seize market opportunities. SWOT analysis was done to generate alternative formulation strategies, covering strength, weakness, opportunity and threat in SWOT Matrix. Having used QSPM get the order of choice (1) Optimizing technology utilization in ordering of drug, (2) Improving the Pharmacy of Esa Farma service, (3) Implement computerized system in the pharmacy management, (4) Developing and implementing Standard Operating Procedure (SOP) of employees, (5) Improving product promotion strategies, and (6) Improving the employee quality. The strategic priority with the highest TAS score of 6,502 was to implement a computerized system in pharmacy management. Keywords: Pharmacy, Business Development, Strategies

INTRODUCTION Health is a vital human need that controls people’s activity and performance. To solve health problems, people do certain actions. This phenomenon is related to their habit in consuming medicine. They do this in order to anticipate and treat health problems. Medication is a component of health services. In general, pharmacies have some functions to offer health services and get profits. Healthy lifestyle and social health insurance schemes through Social Security Supervisory Agency (BPJS) have made pharmacy business increase. BPJS encouraged the use and sale for generics.

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According to data from the Ministry of Health in 2015 there were 25,339 pharmacies in Indonesia (Kemenkes, 2016). Pharmacy Esa Farma is one of the health services business established on December 6, 1994. It is located at Jalan Raya Sukomanunggal Jaya no. 22 Surabaya. Esa Farma Pharmacy Branch is Esa Farma Pharmacy II at HR Muhammad No. 86 K. That the location is strategic and close to several hospitals makes Esa Farma Pharmacy good for business markets. The growing of pharmacy business in Surabaya has influenced the performance of Esa Farma. Some periods have decreased turnover from October 2015 to September 2016. This was due to internal and external factors. Strategic management is required to support the performance of pharmacies in the face of competition. The increasing number of pharmacies has made intense competition among pharmacies, and this has created difficulties in achieving sales and profits. Through strategic analysis of the external environment known as threats and opportunities, the analysis of internal environment is conducted. It is to determine the strengths and weaknesses of Esa Farma pharmacy. Business prospects cannot be separated from the identification of existing environmental factors. This encourages the authors to identify and analyze internal and external factors of Esa Farma Pharmacy, as well as to formulate and prioritize the development strategy of Esa Farma Pharmacy. LITERATURE RIVIEW Business Strategy Analysis of PT Soho Regular Pharmaceutical Industry by Algustie, et al., (2012) concluded that there was a change in competitive conditions that made companies modify their marketing strategies. The EFE matrix and the IFE matrix were 3.02 and 2.78 respectively. The results of the alternative strategy formulation through SWOT matrix and strategy selection using QSPM matrix showed "Increasing product variant with new product development or cooperation with other company" became the most attractive strategy with score 6,183. Strategic Management Strategic management is defined as the art and science of implementing, and evaluating decisions that enable the organization to achieve its objectives. The strategic management objective is to create new opportunities for the future as well for the long-term planning (David, 2010). Strategic Planning A strategic planning is a strategic management component to clarify goals and objectives and allocate resources (Steiss in Glueck, et al., 1998). The purpose of strategic planning is to establish and perfect the business and products so as to meet the target of market growth profit. The main purpose of strategic planning for the company is to know the internal and external conditions of the company Internal-External Matrix (I-E) Analyzing internal factors is to use IFE analysis (Internal Factor Evaluation) as an analytical tool of strategy formulation in identifying and evaluating internal environmental factors as well as measuring strengths and weaknesses. In analyzing external factors using EFE (External Factor Evaluation) analysis, it is to formulate strategies used and evaluate external environmental factors and measure the extent of opportunities and threats faced by the company. The IE (Internal-External) matrix is done by the mapping IFE and EFE matrix scores and analyzing the company's conditions in the SWOT (Strengths, Weaknesses, Opportunities, Threats) diagrams consisting of several quadrants (David, 2010).

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SWOT analysis According Rangkuti (2013), SWOT analysis can be used to identify various factors in formulating corporate strategy. This analysis is based on logic that maximizes the strengths and opportunities; nevertheless, it can simultaneously minimize weaknesses and threats. The strategic decision-making process is related to the development of mission, goals, strategies, and company policies. Quantitative Analysis Strategy Planning Matrix (QSPM) According to David (2010), QSPM (Quantitative Strategy Planning Matrix) is a recommended analytical tool to evaluate strategy choices based on key identified internal and external factors. The purpose of QSPM is to establish the relative attractiveness of various strategies. QSPM allows strategists to evaluate alternative strategies objectively based on previously identified internal and external factors (Fretes, et al.., 2013). RESEARCH METHODS Research Approach The research method was descriptive and analytical. Descriptive method was intended to create a systematic and accurate description of the facts and the relationship between the phenomena studied. The analytical method was to achieve the interpretation (Nazir, 2005). The research was conducted at Esa Farma Pharmacy, Jalan Sukomanunggal Jaya No. 22, Surabaya from September 2016 to January 2017. Sampling Method The sampling technique was to emply purposive sampling. It was based on certain considerations or expert respondents in the field (Sugiyono, 2014). The samples of this study were not determined by the numbers. By contrast, the respondents selected were the expert respondents. The internal party respondents included Esa Farma's Pharmacy owner Mr. Ranu and Mrs. Rahayuningtias as financial officers, employees covering purchasing and warehouse staff, reseptir staff, sales staff, cashier staff, and financial staff. The sxternal correspondent included Esa Farma pharmacists and consumers. Method of collecting data The data collection methods were to use observation, interviews, and document study. Data types were both qualitative and quantitative data. Data sources were primary and secondary data. The primary data were obtained through direct observation and interviews with several employees of Esa Farma Pharmacy. The secondary data used were in the form of reports or documents from Pharmacy Esa Farma Research Instruments The instrument or data collection tool was a tool used to collect data in a study. Research instruments were all tools used to acquire, manage, and interpret information from respondents (Sugiyono, 2014). Research instrument at Esa Farma Pharmacy included interview. This was done by asking questions on questionnaire. Data analysis Data analysis was done by designing alternative business development strategies on Esa Farma Pharmacy with strategic management approach. Data analysis consisted of the analysis of Internal Factor Evaluation (IFE) and External Factor Evaluation (EFE) matrix, InternalExternal Matrix (IE) analysis, SWOT matrix analysis, and final stage using QSPM.

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The environment analysis was done by giving the weight and rates to the internal and external factors. The total of IFE and EFE matrix scores were used to determine the firm's position and applicable strategies (Kinnear, et al., 2000). The SWOT matrix was organized structured based on the strength, weakness, and opportunity and threat factors. The SWOT matrix was done by formulating alternative strategies that would promote the development of companies (Rangkuti, 2006). QSPM's interest scores were used to get alternative strategies. Quantitative Strategic Planning Matrix (QSPM) was a technique to set the priority of alternative strategies. Quantitative Strategic Planning Matrix (QSPM) was a tool to evaluate strategies to optimize the results (David, 2010) RESULTS AND DISCUSSION IFE Matrix Analysis After obtaining the internal factors, respondents such as the Esa Farma owner, financial staff and pharmacist assistants, were encouraged to fill in the questionnaires. The questionnaires were filled by respondents to give weights and ratings. Here were the results of IFE matrix analysis on Esa Farma Pharmacy: Table 1. IFE Matrix Analysis Factors of Internal Strategies Strenght: Strategic company location The establishment of the business has a license Good relationship exists between the pharmacy and consumers Communication between owners and employees is well established Total Weakness: Manual financial bookkeeping system Lack of skills in the management of enterprise management Coordination of task distribution is less effective Total Total IFAS

Weight Rating

Score (weight x rating)

0.19

1.50

0.28

0.16

1.83

0.29

0.17

3.00

0.52

0.13

1.17

0.16 1.24

0.16

3.50

0.57

0.12

3.83

0.46

0.06

4.00

0.25 1.29 2.53

Table 1 shows the pharmacy had good relationships with consumers as indicated by the score of 0.52. Esa Farma pharmacy always tried to build consumers’ loyalty by giving good services. The main drawback was due to poor coordination of job distribution as shown by the score of 0.25. Such a job distribution was less specific: employees performed tasks that did not become their main jobs.. The total value of the IFE (Internal Factor Evaluation) matrix was 2.53. The weakness value was higher than that of the strength, and this implied that Esa Farma pharmacy needed to minimize and anticipate weaknesses. EFE Matrix Analysis

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Following the external strategy factor covering opportunities and threats, the respondents were encouraged to fill in the questionnaires about the internal environment. The questionnaires involved external parties outside the pharmacy Esa Farma to maintain the objectivity of the study. The questionnaires were filled by each respondent to rate and give weight. Here is the result of EFE (External Factor Evaluation) matrix analysis on Esa Farma Pharmacy Table 2 Matrix EFE Analysis Weight Rating Factors of External Strategies Opportunities: The high demand for medicinal needs in the community Increased education level and public knowledge about the importance of drugs Utilization of technology in increasing product sales Total Threat: The number of similar pharmacies and generic near the location of Esa Farma Pharmacy Consumer behavior in choosing a pharmacy Total Total EFAS

Score (weight x rating)

0.31

3.17

0.98

0.26

2.33

0.61

0.20

3.33

0.67 2.27

0.13

2.83

0.38

0.09

2.83

0.26 0.64 2.91

Table 2 Matrix EFE Matrix Analysis Esa Farma pharmacy shows the external strategy factors that become opportunities and threats. The main opportunity for pharmacy Esa Farma is high demand for drug requirement as indicated by the biggest value that of 0.98. Meanwhile, the smallest score of 0.26 is consumer behavior in choosing pharmacy. The total value of the EFE matrix is 2.91, indicating that Esa Farma is trying to make use of opportunities and avoid threats. SWOT analysis After obtaining the total value of the IFE 2.53 matrix and EFE 2.91 matrix, the next step was to compile the SWOT analysis diagram. It was intended to find the position of Esa Farma Pharmacy quadrant. 1. To obtain a position at Y, the weighted and rating results on the opportunity we3re reduced by the weighted and rating product on the threat: Opportunities = 2.27 Threat = 0.64 Point Y = Opportunities - Threats = 2.27 - 0.64 = 1.63 2. To obtain a position at X, the weighting and rating results on the power were reduced by the weighted product and the rating on the weakness: Strength = 1.24

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Weakness = 1.29 Point X = Strength - Weakness = 1.24 - 1.29 = -0.05 Opportunity 1.63

Quadrant I

Quadrant III

Strength

Weakness - 0.05

Quadrant IV

Quadrant II

Threat

Figure1 SWOT Analysis Diagram From Figure 1, the position of Esa Farma Pharmacy was -0.05; 1.63 or in quadrant 3. The business development of Esa Farma Pharmacy was the power to exploit opportunities. The appropriate strategy was self-improvement strategy. It focused on minimizing the internal problems of the company in order to increase market opportunities. Based on the results of the above analysis, SWOT matrix consisting of strength and opportunity (SO), weakness and opportunity (WO), strength and threat (ST) and weakness and threat (WT), in detail the strategy can be seen in Table 3: Table 3 SWOT Matrix Mapping Results STRENGTHS (S) WEAKNESS (W) 1. Strategic company 1. Manual financial location bookkeeping system 2. Business establishment 2. Lack of skills in managing has a license corporate management 3. Relationship well 3. Coordination in the division established between the of tasks is less effective pharmacy Esa Farma with consumers 4. Communication between owners and employees is well established OPPORTUNITIES (O) STRATEGY S-O STRATEGY W-O 1. High demand for medicinal 1. Optimizing the use of 3. Applying computerized needs in the community technology in ordering system in pharmacy 2. Increased education level and drugs management public knowledge about the 2. Improve the service of 4. Develop and implement the importance of drugs pharmacy Esa Farma implementation of Standard 3. Utilization of technology in Operating Procedure (SOP) increasing product sales employees

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THREATS (T) 1. The number of similar pharmacies and generic near the location of Esa Farma Pharmacy 2. Consumer behavior in choosing a pharmacy

STRATEGY S-T 3. Improving product promotion strategy

STRATEGY W-T 3. Improve employee quality

Based on the SWOT matrix analysis, the alternative business development strategy of Esa Farma Pharmacy is as follows: 1. S-O Strategy Esa Farma Pharmacy's strength strategy is to take advantage of opportunities. Here are alternative strategies for the development of pharmacy Esa Farma: a. Optimizing Technology Utilization in Drug Reserves b. Improving Esa Farma Pharmacy Services 2. W-O Strategy Weakness in Esa Farma Pharmacy can be anticipated by taking advantage of opportunities. Here are alternative strategies for the development of pharmacy Esa Farma: a. Implementing Computerized System in Pharmacy Management b. Preparing and implementing the Implementation of Standard Operating Procedure (SOP) Employees 3. S-T Strategy Esa Farma's pharmacy strength strategy is to anticipate threats. Here are alternative strategies for the development of pharmacy Esa Farma: a. Improving Product Promotion Strategy 4. W-T Strategy Strategies to minimize weaknesses are deal with threats. Here are alternative Strategies for the development of pharmacy Esa Farma: a. Improving Employee Quality Quantitative Analysis Strategy Planning Matrix (QSPM) The final stage of strategy formulation analysis is the selection of strategic priorities. The analysis used is Quantitative Strategic Planning Matrix (QSPM). QSPM. It is used to determine the relative attractiveness of various strategies. The US value (Attractiveness Score) shows the attractiveness of each strategy against the internal and external key factors of the firm. US values were obtained through the questionnaires. The Total Attractiveness Scores of each respondent were obtained by multiplying the weighted average scores and the US value of each key strategic factor. The calculation of the value of STAS (Sum Total Attractiveness Scores) from each respondent was done by summing all the TAS values of each internal and external factors.

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Table 4 The Primary Alternative Strategies

STAS 1 STAS 2 STAS 3 STAS 4 STAS 5 STAS 6

Respondent 1

Respondent 2

Respondent 3

Respondent 4

Respondent 5

Respondent 6

STAS Rata-Rata

Primary Strategy

5.736 6.064 5.909 5.030 5.750 5.573

5.924 6.399 6.507 5.151 5.457 5.891

6.253 6.227 7.055 5.151 4.963 5.320

6.180 5.891 6.720 5.528 4.868 5.359

6.273 5.665 6.442 5.151 4.774 5.492

6.139 6.043 6.378 4.987 5.178 5.719

6.084 6.048 6.502 5.166 5.165 5.559

2 3 1 5 6 4

Based on the calculation of STAS (Sum Total Attractiveness Scores) in Table 4, the priority strategy is "Applying computerized system in pharmacy management" as indicated by its highest average STAS 6.502. The priority strategy for the development of pharmaceutical business at Esa Farma Pharmacy, are as follows: 1. Optimizing technology utilization in drug ordering (STAS = 6,084) 2. Improving services at Esa Farma Pharmacy (STAS = 6,048) 3. Applying computerized system in pharmacy management (STAS = 6.502) 4. Prepare and implement the implementation of Standard Operating Procedure (SOP) employees (STAS = 5.166) 5. Improving promotion strategy (STAS = 5.165) 6. Improve employee quality (STAS = 5,559) The results of the questionnaire show alternative strategies that most respondents prefer. The alternative strategy with the highest STAS value is a strategy that needs to be implemented first. The results of the questionnaire indicate several alternative strategies. The highest priority strategy is to apply computerized system in pharmacy management CONCLUSION 1. The analysis of internal and external environment of Esa Farma Pharmacy, consisting of: A. the internal strategy factor - strength, ie strategic company location, business establishment permits, good relationships between Esa Farma pharmacy and consumers, good communication between owner and employee. While internal strategy factors - weaknesses, namely manual financial bookkeeping system, lack of skills in the management of corporate management, coordination of the division of tasks less effective. B. the external factors - opportunities such as high demands for medicines in the community, the increased level of education and public knowledge about the importance of drugs, the use of technology and increase product sales. Meanwhile, the external strategy factor - the threat such as numbers of similar pharmacies and generic near the pharmacy Esa Farma location, and consumer behavior in choosing a pharmacy. 2. The alternative and strategic priorities can be applied in Esa Farma are as follows: A. The total IFE matrix is 2.53 and the EFE matrix is 2.91. The position of Esa Farma Pharmacy was at coordinates -0.05; 1.63 or in quadrant 3. It means that business development of Esa Farma Pharmacy can be used to exploit opportunities. Based on the SWOT matrix analysis, the alternative strategies of Esa Farma Pharmacy business development are: (1) to implement computerized system in pharmacy management, (2) to optimize technology utilization in ordering drugs, (3) to improve service at pharmacy Esa Farma, (4) to improve quality Employees, (5) to develop and implement the implementation of SOP employees, and (6) Improving promotion strategy.

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B. Based on the QSPM matrix of the highest STAS value calculation, the priority of strategy that can be applied to Esa Farma Pharmacy in business development is to apply computerized system in pharmacy management with the highest average value of STAS which is 6,502.

REFERENCES Algustie, Anna Karina dan Dharmmesta, Basu Swastha. 2012. Analisis Strategi Bisnis PT Soho Industri Farmasi Reguler. Jurnal Manajemen dan Pelayanan Farmasi, II (4): 231-238. David, Fred. R. 2010. Manajemen Strategis. Konsep Terjemahan. Jakarta: Salemba. Fretes, R.A.; Santoso, P. B.; Soenoko, R.; dan Astuti, M. 2013. Strategi Perencanaan dan Pengembangan Industri Pariwisata dengan Menggunakan Metode SWOT dan QSPM (Studi Kasus Kecamatan Leitimur Selatan Kota Ambon). Jurnal Rekayasa Mesin. 4 (2): 113. Glueck, William F, dan Lawrence R, Jauch. 1998. Manajemen Strategis dan Kebijakan Perusahaan. Jakarta : Erlangga. Kementerian Kesahatan RI. 2016. Grafik Rekapitulasi Apotek Indonesia. Available at: http://binfar.kemkes.go.id (Accessed: 2 November 2016). Kinnear, T.C., J. R. Taylor. 2000. Marketing Research and Applied Approach.Fourth Edition. McGraw Hill, New York Nazir, M. 2005. Metode Penelitian. Jakarta: Ghalia Indonesia. Rangkuti, Freddy. 2013. Analisis SWOT Teknik Membedah Kasus Bisnis: Reorientasi Konsep Perencanaan Strategis untuk Menghadapi Abad 21. Jakarta:PT. Gramedia Pustaka Utama. Sugiyono. 2014. Metode Penelitian Kuantitatif, Kualitatif, dan R&D. Bandung: Alfabeta.

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THE EFFECT OF SELF-EFFICACY AND STUDENT MOTIVATION TOWARD THE STUDENT ACADEMIC ACHIEVEMENT IN HUMANITIES CLASS AT CIPUTRA JUNIOR HIGH SCHOOL SURABAYA Allen Dharmawan Wicaksono, 2Danardana Murwani♠

1

Ciputra University, Surabaya INDONESIA Email: [email protected]

ABSTRACT This research is conducted to looking for the effect of of self-efficacy and motivational study toward the student academic achievement in Humanities class at Ciputra Junior High School Surabaya. This is a quantitative research that use path analysis method in their statistical calculation. The population of student that used in this research are 84 students which are the grade 8th student in Ciputra Junior High School in Surabaya. The number of sample used in this research are 68 students which randomly picked up by proportional stratified random sampling method. This research is using the Motivated Learning Strategies Questionnaire to test student self-efficacy and their motivation. Reliability of the instrument is calculated using the Alpha Cronbach’s formula. All the data in this research is analysed by the SPSS 23 Software using double linear regression. The result of this research shows that self-efficacy and motivation affect positively and significantly towards the student academic achievement in Humanities class at Ciputra Junior High School Surabaya. All of the hypotheses are accepted with the conclusion that self-efficacy affects positively and significantly towards the student academic achievement, self-efficacy affects positively and significantly towards the student study motivation, and the student motivation affects positively and significantly towards the student academic achievement. Keywords: Self-Efficacy, Student Motivation, Student Achieveme

INTRODUCTION As the founding father dream when they first build this country post the Dutch colonialism, the Indonesian’s government has contributed so much thing to improve the education of their citizen. These noble objectives stated in the foundation of nation-building which is written in the Outline of the State Policy of the Republic of Indonesia. The Indonesian government put the idea of national education major in the Law on the National Education System 23 2003 Article 3 which describes the function and purpose of education. The National Education System was established to accommodate the aspirations of the nation with the aim of developing the potential of all students in Indonesia to be a man of faith, piety to God Almighty, have good

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attitudes, physically and mentally healthy, knowledgeable, capable, independent, highly honor the democracy and be reflective towards the changes. Education indeed become the most vital element of the country, especially in during the reign of Mr. Joko Widodo, the 7th President of Indonesia. His vision to change the current Indonesian people with his ‘Mentality Revolution’ of his own make Indonesian become more aware of the current education issue. Based on 4th amendment of Indonesian’s 1945 Constitution Article 31 paragraph (4) giving more clarity of the government education concern by giving at least 20% of the state budget to run the Education system in Indonesia (APBN News, 2015). In 2015’s budget allocation, 408,5 trillion Rupiah’s was allocated by the house of representative which sum up the total amount of 20.59% from the total of Government budget on that period. That figure is the highest amount of money allocated which channeled through the State budget and Local Governement budget across the 34 province owned by the biggest archipelago country in the world (APBN News, 2015). To this day, the role of education remains as a major influence in order to advancing the human capital of the country. The National Education System is always being renewed and experienced a dynamic change as different Education Minister may want the landscape of the education by his own term. We are now experiencing the education system after the Indonesian’s Reformation era 1998 which push the children of Indonesia to study in 12 years program or better known as ‘Wajib Belajar 12 Tahun’ project (Herdiyanti, 2011). Subsidies and many others policy has been used to help the Indonesian citizen to have decent education system. Sekolah Ciputra Surabaya is an educational institution belong to Yayasan Ciputra Pendidikan. This school was firstly established by the property conglomerate Ir. Ciputra in 1996 above the land of Citraland in the West Surabaya region. Sekolah Ciputra Surabaya simply is an integrated International school that offers education from Early Childhood Development Program to the Diploma Program for the year 11-12 High School student. Sekolah Ciputra adopted the IB (International Baccalaureates Curriculum) and became the first school in East Java to implements this Curriculum. Being part of the Ciputra Group, Sekolah Ciputra apply the 3 core company’s values, which are Integrity, Professionalism, Entrepreneurship. Those values are being taught to the student in every educational process in the school. In addition to these three core values, Sekolah Ciputra also imparted 10 values of International Baccalaureates Learner Profile which contains 10 qualities that should be possessed by the learners, including: Inquirers, Knowledgeable, Thinkers, Communicator, Principled, Open-Minded, Caring, Risk Taker, Balanced and Reflective (International Baccalaureates Organization, 2014). By having different curriculum, Sekolah Ciputra also has a different system of assessment to assess every individual which has different value and standard from the general school in Indonesia. Sekolah Ciputra assessment criteria is divided into 2 major classifications, which every lesson has different standard. Humanities subjects is one of the major subjects in Middle Year Programme at Sekolah Ciputra. This lesson blends the Economics, Business, Geography, History, Sociology and Citizenship Education into one Humanities studies. Humanities is a branch of social studies and included to Individual and Societies faculty along with other social sciences. In Humanities subject, the students are being assessed using four criteria. Criterions assessed in Humanities subjects have the same portion in a thorough assessment so that students can reflect on their learning outcomes. Each Criterion rated by the scale of 1-8 which will be assessed from different ways and measured student’s understanding on the other level. Majority of the Sekolah Ciputra students came from financially strong family which able to fulfill their basic need more and beyond. The strong parental background force them to achieve higher result which expected by their parents (Setyaningrum, 2015). Family background

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become one of the significant factors for the student motivation to achieve higher academic result. Those feeling create inner driven spirit that lead them to have Self-Efficacy. This new, sophisticated and different curriculum owned by Sekolah Ciputra creates new phenomenon which make this school have different style in teaching their students. Which is why this research is felt necessary to test the condition towards this unique situation. Therefore, this research will examine “The Effect of Self-Efficacy and Student Motivation Toward the Student Academic Achievement in Humanities Subject at Ciputra Junior High School Surabaya.”

LITELATURE REVIEWS The Student Achievement: One of success measurements in an education system is the student achievements level. By measuring the academic achievement, it will be the snapshot of student’s success on particular subjects. It could even represent a person's success in his overall learning experience. Learning is defined as a series of activities to obtain a change in behavior as a result of individual experience in interaction with the environment including the cognitive, affective and psychomotor aspect (Setyowati 2007). Meanwhile, learning system itself can be defined as an integral component of interrelated and interaction with the main goal of achieving an optimal results expected in accordance to the objectives determined beforehand. A learning achievement is the results achieved by pupils after they receive the knowledge, both at school and outside of school. Another aspect to take a look from student achievement in schools will be their evidence attempt by student that gained experience in studying (Winkel, 1991:60). People do realize that nowadays the achievement of student can be measure by both quantitative and qualitative data. In both ways, test no longer be the only way to measure the student intelligence. Sekolah Ciputra applied the project-based assessment rather than conventional penciled-test examination. It is believed to be one of the most successful way as the student will be able to get the score as well as the teacher comments. The Self-Efficacy Theory: Self-efficacy is one of the classic psychology theory developed by Albert Bandura in 1986. Bandura himself defined self-efficacy as perceptions about the ability of individuals to organize and implement actions to display certain skills (Bandura, 1986). On the other hand, self efficacy is defined as our feelings about the adequacy, efficiency and our ability to cope with life (Schultz, 1994). Self-efficacy or commonly described as habitual beliefs can be acquired, upgraded, downgraded or changed using one or a combination of these four sources, including: performance accomplishment, vicarious experience, social persuasion and lastly emotional physiological states (Baron and Byrne 2000). According to Bandura (1996), the high-low self-efficacy someone in the execution of each task will vary. It is caused by several factors that influence the ability of self-efficacy perception of each individual. Those factors are: gender, age, education level and experience. Student Motivation: Motivation is a driving factor of humanity that can trigger a sense of spirit and also capable of changing human behavior or individuals to lead to better things for the benefit of himself (Hamalik 2004:173). Motivation also can be described as basic urges internal and external of an individual or so-called gift. Motivation is one of the processes for generating, maintaining, and controlling interests (Alderfer 1991). Judging from the Maslow hierarchy of needs theory (Maslow, 1943), the motivation level tier is located in the need to develop the ability to have a better understanding of the achievement and creative thinking. Someone who has a high motivation can mean the person has reasonable

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grounds to achieve anything he wants to do his job is now to the fullest. Therefore, motivation can be described as a mental boost that can drive and steer human behavior, including learning behavior (Dimyati and Mudjiono, 2009:80). Prayitno (1989: 10) stated that there are 2 classification of motivation owned by human being. The intrinsic motivation and the extrinsic motivation. Intrinsic motivation described as the desire for someone in the act that caused a boost factor from within the individual. An individual who is driven by intrinsic motivation will only be satisfied if the activities undertaken have achieved the maximum results (Gunarsa 2008:50). On the other hand, the extrinsic motivation is defined as is to do everything based on his own observations, or through advice, suggestion or encouragement from others. Knowing the general understanding of learning that has been described above, motivation can be describes as the driving wheel in human beings, directing and maintaining behavior of doing things can also be applied to the learning process as well (Nashar 2004:39). Motivation has become big influence on learning process, if teachers are not able to increase the motivation of the students will not learn as well as possible, because there is no special attraction for him. It will result on students being reluctant to learn, students do not obtain satisfaction from that lesson. Several ways can be used to increase student learning motivation. It is caused by motivation is just a psychological process that reflects the attitude. Thus, motivation to learn is a psychological condition that encourages students to learn in a pleasant conditions and earnestly. It is expected therefore that student learning is systematically be formed and students can conduct all its activities to the fullest (Suprijono 2009:163). Humanities Studies: Humanities subject is one of the core values that are taught in the International Baccalaureates curriculum which is a unique provision that is prepared to meet the social needs of students as members of the society. In Indonesian national curriculum this lesson is being called as Social Studies. Social studies subject is a simplification of various discipline such as the social sciences, psychology, philosophy, ideology and religiosity, prepared and presented scientifically and psychologically for educational purposes (Sumantri 2001: 44). This social studies is a subject that combines the basic concepts of the various social science subject compiled into an educational and psychological approach and the feasibility and significance of the students as well as for life (Samlawi and Maftuh 1998: 1). The concepts being taught including basic concepts of social sciences such as geography, history, economics, civics, politics, sociology, anthropology, and psychology. Studying Humanities subject may have some functions towards the student. One of them is to prepare student’s social skill and is convinced of his own life in the midst of the social and physical strength. Someday there will be a time in which the learners will become good and responsible citizen of this country (Gunawan, 2011: 37). While written in Indonesian Education Minister Notes No. 68 Year 2013, the goals of humanities and social studies is to emphasize the understanding of the nationality, the spirit of nationalism, patriotism and community activities in economics within this country region. One of the fundamental differences between the Sekolah Ciputra’s Humanities studies with the Social Sciences Studies in Indonesian’s national curriculum is that emphasizes the transmission of the content of the lesson (content-based), while Humanities subjects emphasizes more on the process of teaching the global context of a given subject so that students better understand the deeper meaning than just lessons they receive daily. Those global contexts include: Identities and Relationship, Orientation in Time and Space, Personal and Cultural Expression, Globalization and Sustainability, also Fairness and Development. HYPOTHESES AND PATH ANALYSIS

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Every human being must have curiosity to know the results of the activities that he did, is no exception in learning activities. The learning achievement is generally related to aspects of knowledge (cognitive), while the learning outcomes include aspects of the character formation of students, namely cognitive, affective, and psychomotor (Arifin, 2009:11) Learning achievements earned by students are not always the same, the resulting value was varied ranging from high to low. The level of learning achievement is influenced by many factors, such as motivation and self efficacy. From the description above can be built the conceptual framework is the relationship of the three variables, namely self-efficacy, learning motivation and academic achievement as follows:

Motivation

Academic Achievement

Figure 1. Path Analysis Diagram Based on that path analysis diagram, this research constructs 3 hypotheses as follows: H1: There is a positive and significant relationship between self-efficacy and student’s academic achievement in Humanities Subject at Ciputra Junior High School Surabaya. H2: There is a positive and significant relationship between self-efficacy and student’s student motivation in Humanities Subject at Ciputra Junior High School Surabaya. H3: There is a positive and significant relationship between student motivation and student’s academic achievement in Humanities Subject at Ciputra Junior High School Surabaya.

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RESEARCH METHODS Towards this social phenomenon that we tried to solve, quantitative research is used. The quantitative research itself is a research methodology which emphasize more on the numerical data which calculating the data using statistical theory to draw the conclusion (Azwar, 2007:5). This research also considered as descriptive research which use the facts, conditions, variable and current real-life phenomenon. On the other hand, this research also testing the correlational relation between the variable. The variable that being tested in this research are: Self-Efficacy, Student Motivation and Academic Achievement of the student. Student motivation is again classified into 2 subvariables which are the intrinsic variable and the extrinsic variable. Meanwhile the self-efficacy classified into the ability to complete task and confidence level in skill performed. To collect the data, this research conducted a questionnaire which adopted from the Paul Pintrich called Motivated Strategies for Learning Questionnaire. The respondent of the questionnaire are the students from Sekolah Ciputra. They are the 8th grader which consist of 84 students, with this following classification: 1. Dominated by male student (60%) 2. Graduated from Ciputra Elementary Student by 76% 3. 86% of the respondents are Indonesian citizen. Whereas the rest came from many contries in the world such as: Fiji, France, United States, England and Australia. The questionnaire consists of 21 question inside with classified into 7 question of self-efficacy and 14 question about student study motivation. RESULT Each data generated from the questionnaire that the respondent fill in during the class-time. Therefore, their questionnaire result is correlated into their class performance during the first term in the 2016-2017 academic calendar in Humanities class. Based on that research, here is the result of this research: Path Analysis 1 The relationship between the self-efficacy towards the student motivation in the classroom. F Test F Score 78.108

t-Test Sig. 0.000

t 8.838

Sig. 0.000

R-Square 0.736

With the result of this first path analysis indicates that the hypotheses zero is declined and therefore, the self-efficacy is positively related to the student motivation in the classroom. Path Analysis 2 The relationship between the self-efficacy and the student motivation in the classroom towards the student achievement in Humanities class. F Test F Score Sig. Self-Efficacy towards the student achievement Student Motivation towards the student

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t-Test t

Sig.

R-Square

22.555

0.000

2.665

0.000

0.640

22.555

0.000

5.536

0.000

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achievement Direct-Indirect Effect Analysis Towards the effect variables being researched in this research, there are some direct-indirect effect. Those effect can be seen as follows: Dependent Variable Student Achievement Student Achievement

Independent Variable

Direct Effect

Indirect Effect

Total Effect

Self-Efficacy

0.259

(0.736)(0.538) = 0.396

0.655

Student Motivation

0.538

-

0.538

Hence with this table shown above we can conclude that the direct effect of self-efficacy towards the student achievement is just as big as 0.259. Meanwhile the total effect of it is 0.655. Therefore, the indirect effect that pass through all the way to the end of the path is very determinant. Result Discussion Data analysis result indicate that the self-efficacy is positively related and significant towards the academic achievement. Secondly, the self-efficacy itself also positively related and significant towards the student motivation in the classroom. Last but not least, the student motivation in the classroom is also positively realted and significant towards the academic achievement.

CONCLUSION Based on the research conducted which supporting the existing theory, these are the conclusion of this research. All of the hypotheses are accepted with no exception. Meanwhile the data of this research can be used for the development of Sekolah Ciputra to develop their program even further. The Senior Leadership Team of the school should realize the competitive advantage of having this curriculum that support the student to have their own self-efficacy and enhance student’s motivation in the classroom. Where as the other school would probably learn from the existing curriculum of Sekolah Ciputra which encourage the sudent to have self-efficacy and more motivation in the classroom as it is proven can boost the student academic achievement.

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REFERENCES APBN News, (2015). Tentang Postur APBN-P 2015: Anggaran Pendapatan dan Belanja Negara Perubahan 2015 (APBN-P 2015). Diakses dari http://apbnnews.com/artikel-opini/tentangpostur-apbn-p-2015/ Bandura, A. (1997). SELF-EFFICACY: The Exercise of Control. New York: W. H Freeman and Company. Baron, R. A.& Byrne, D. (2004). Psikologi Sosial. Jakarta: Erlangga.
 Dimyati dan Mudjiono. (1994). Balajar dan Pembelajaran. Jakarta: Depdikbud. Gunawan, Rudy. (2013). Pendidikan IPS: Filosofi, Konsep dan Aplikasi. Herdiyanti, Yati. (2011). Pendidikan Seumur Hidup, Tesis Pasca Sarjana, Makasar: Universitas Hassanudin Makasar Maslow, A. H. (1943). A theory of human motivation. Psychological Review, 50, 370-396. doi:10.1037/h0054346 Pintrich, P.R., & De Groot, E. (1990). Motivational and self-regulated learning components of classroom academic performance. Journal of Educational Psychology, 82, 33 – 40. Prayitno, Elida. (1989). Motivasi dalam Belajar dan Berprestasi. Jakarta: Departemen Pendidikan dan Kebudayaan Direktorat Jendral Pendidikan Tinggi Samlawi, Fakih dan Bunyamin Maftuh. 1998/1999. Konsep Dasar IPS. Jakarta: Dekdikbud. Ditjen. Pendidikan Tinggi Proyek Pendidikan Guru Sekolah Dasar Schultz, D and Pintrich, P. (2010). Motivation in Education. Englewood Cliffs. New Jersey: Prentice Hall. Setyaningrum, Anindithya. (2015). Pengaruh Dukungan Sosial Orang Tua Terhadap Motivasi Berprestasi Siswa Kelas V Sekolah Dasar Di Gugus Hasanudin Kabupaten Cilacap
 Tahun Ajaran 2014/2015. Skripsi. Universitas Negeri Yogyakarta Sumantri Mulyani dan Permana, Johar. (2001). Strategi Belajar Mengajar. Bandung: CV Mulyana Sugiono. (2008). Statistika Untuk Penelitian. Bandung CV. Alfabeta 
 . Metode Penelitian Kuantitatif Kualitatif dan R&D. Bandung: Alfabeta Winkel, W.S. (1991). Psikologi Pengajaran, Jakarta: Grasindo

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PERCEPTION OF POTENTIAL PATIENTS AND DOCTORS AGAINTS DOCTORS BASED ONLINE CONSULTING SERVICES 1

Andrew Limandow, 2Thomas Stefanus Kaihatu♠ Ciputra University, Surabaya INDONESIA ABSTRACT

Health is one of the primary need of human beings. In the midst of rapid technological developments, doctor need to improve their service by using technology innovation. One of the innovation can be use is online medical consultation. Perception of the rospectivel patient and doctors is important in choosing this kind of service. In this research, writer found that prospective doctors perception to online medical consultation is good but this technology can not replace face to face physician service, however this can be used as complementary of physician service such as a online booking or for follow-up. Prospective patient perception to online medical consultation is good if this service given by trustworthy agents. Keywords : Online medical consultation, patient and doctor perception, telemedicine, doctor-patient communication.

INTRODUCTION Technological developments become more complex day by day and internet users is also increasing everyday. According to Kemenkominfo (2015), explained that there were 82 million people using internet everyday in Indonesia. Internet usage is mostly for sending and receiving emails, social media, search for the latest news, looking information about goods or services, internet banking, for buying and selling goods or services, recruiting worker, video conferencing, etc. (Harian TI, 2013). Doctors is one of the noble jobs that can provide health services for the society. When the body and the soul are healthy, people can work well. To provide more better health services, doctors should not be outdated, especially in the use of technology. Considering the number of doctors who are not much, 171.595 doctors (Konsil Kedokteran Indonesia, April 2016), and the number of people in Indonesia are 237.641.326 people (Badan Pusat Statistik, 2010), doctors need to utilize the online system to help provide services to the society without reducing standard of medical services. There are several webs and applications that have been trying to bring this doctor-patient relationship closer. Some of them are www.konsula.com and www.klikdokter.com. According to Gidwani et al.(2012), the used of information technology for diagnose, theraphy and monitoring patient condition is reffered to as telemedicine. Online Medical Consultation (OMC) is a term used by Al-Mahdi, et al. (2015), to refer long distance medical consultation services. OMC is part of telemedicine which is a long-distance telecommunication consultation that is generally for diagnostic and treatment purpose. OMC makes the patient does not have to leave their home or places of work, sit in traffic then sit in the waiting room with other patient perhaps catch or cause infection meantime, and then go back home or where they came from. Few publication at US, according to Al-Mahdi et al. (2015), reported that e-Visits were very applicable with high satisfied levels on patient. Internet based video consultation also has been practiced in Australia in the field of psychiatry, emergency care and pediatrics.

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Online Medical Consultation were also related to the doctor-patient communication relationship. According to Wahyuni et al. (2013), doctor-patient communication is a very important the field of therapeutics in the hospital. The communication quality that occurs between the two sides will results satisfaction within the patient. Patients that feel satisfied will return to the same doctor if their communication is good and effective. However, were this effectiveness will apply if the doctor-patient communication relationship is performed online utilize telemedicine, especially Online Medical Consultation? From that case, we raised a study that attempted to find the perception of potential patient and doctor on doctors based online consulting services. Consumer Behavior Consumer behavior is defined as a science that studies processes that influence when an individual or group chooses, buys, uses or discards a product or service, an idea or experience to satisfy a need or satisfy a desire (Solomon, 2012). Marketing stimuli include 4P, namely Product, Price, Place, and Promotion (Armstrong and Kotler, 2012, Schiffman and Kanuk, 2016). In addition, other stimuli that affect buyers are economics, technology, politics and culture. Perception Perception is a process done by an individual to select, organize, and interpret stimuli into meaningful and reasonable images of the world (Schiffman and Kanuk, 2016). Perception arises from a stimuli that gives rise to sensation. Stimuli are accepted through the five senses. Accepted stimuli are chosen based on consumer experience, expectations and motives on stimuli (Schiffman and Kanuk, 2016, Solomon, 2016). Knowledge is also influential in the perception process (Goldstein, 2010). Perception of Service Quality If the services received or perceived in accordance with the expected quality of services perceived good and satisfactory. If the service received exceeds the customer's expectations, then the service quality is perceived as the ideal service quality. Conversely, if the service received is lower than expected then the service quality is perceived poorly. Service quality dimensions include tangible, reliability, responsiveness, assurance, coutersy, emphathy (Caha, 2007 and Kara, 2014 in Kayral, 2014). Doctor-Patient Communication Communication is a process of moving from one person or group of people to one or a group of others using certain symbols to give an effect. Doctor-Patient Communication affects the level of patient satisfaction (Wahyuni, et al., 2013). Doctor-patient communication is judged by confident, emphatetic, humane, personal, frank, respectful, thorough (Bakic-Miric and Bakic, 2013). Step in success in doctor-patient communication is making positive first impression, course of the interview, patient response, collaboration with patient, how to end the conversation. E-commerce E-commerce is the exchange between individuals or between organizations and activities that facilitate such exchanges with the application of information technology (Cannon et al., 2008 in Gunawan and Wicaksono, 2013). E-commerce can be divided into 4 perspective, a communication perspective, a business perspective, a service perspective, and an online perspective (Kalakota and Whinston, 1997, in Gunawan and Wicaksono, 2013). E-commerce

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must have features that traditional service do not have, include always on, locationsentric, convenience, customizeable, identifiability (Chen et al., 2011). Online Serviscape Online Serviscape is factors of online eviromental that appears during delivering service process (Harris and Goode, 2010). Online serviscape is divide into three dimension, Aesthetic appeal, online layout and functionality, and financial security. Channel Strategy Websites provide convenience and choice of how to purchase a product. A successful marketer now uses a multi-channel strategy that involves a quality website for electronic exchange. There are several factors influencing channel strategy, included commodity, conditions, competition, costs, coverage, competence, control, character of intermediaries (Peter and Olson, 2010). Telemedicine and Online Medical Consultation. According to Kay et al. (2010), telemedicine is a health service, where distance is a critical factor, by professional health service providers using information and communication technology for valid information exchange aimed at diagnosis, treatment and prevention of disease and injury, research and evaluation, and for continuation of education Healthcare providers, all for the betterment of the health of individuals and their communities. There are two types of telemedicine, the synchronized direct interaction and the interaction are not synchronized. Online Medical Consultation is part of telemedicine. Online Medical Consultation is a synchronized online doctor consulting service, between healthcare providers and patients, which is constructed with secure tissue in an electronic medical record and a medical history structured and computerized to help clinic workers at a distance and for nonmedical cases Which can be overcome without direct physical examination (Gidwani et al., 2012)

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1. Research Design Backgrounds Along with the development of the world of technology, the medical world has a so-called telemedicine and one of them is online medical consultation. This causes the need for doctors to know how the patient's perception of online-based consultation. Rumusan Masalah What are the perceptions of potential patients and doctors on online doctor-based consultation?

Basic Theory 1. Consumer behavior is the study of the influential process when an individual chooses, buys, uses / discards a product / service / idea / experience to meet the needs / satisfy the desires. (Solomon, 2016). 2. Perception is a process done to select, organize, and interpret stimuli into meaningful and reasonable images of the world. (Schiffman and Kanuk, 2016). 3. The Internet and many digital technologies have given businesses a new way to reach and serve customers. (Armstrong and Kotler, 2012)

Previous Research 1. Al-Mahdi, et al. (2015). Online Medical Consultation is a growing phenomenon introducing several modalities interactions, variations of health consultancy services, and accessible to consumers around the world. 2. Singh, et al. (2015). The role and application of telemedicine will continue to increase along with the development of technology and the evolution of health services. 3. Gunawan and Wicaksono (2013). Reponden has a high level of perception of online servery website bakery especially photo products. 4. Gidwani, et al. (2012). Creating an expected model of e-Visits system can help doctorpatient communication. 5. Horner, et al. (2011). E-consultation offers an opportunity to improve the quality of health care and reduce the cost of specialist services. 6. Wahyuni, et al (2015). Concluding that there is a relationship between doctor-patient communication with patient satisfaction Interview Data Analysis treatment.

Conclusions Figure 3.1. Research Design

RESEARCH METHODS This study is a qualitative research. Qualitative research is data in the form of nonnumeric or nominal, but more often in the form of statement sentence, a description or description that contains the meaning and certain values obtained through qualitative data mining instruments (Herdiansyah, 2013). Selection of sample by purposive

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sampling method with judgmental method. Purposive sampling Method is chosen by respondents based on certain characteristics, with judmental method, in which the respondent is selected based on the consideration of the researcher. Technique of data collecting is done by semi structured interview. Semi-structured interviews have characteristics in which the questions are open, but have boundaries of themes and flow of speech, predictable, flexible but controlled interview speed, interview guides, the purpose of the interview is to understand a phenomenon (Herdiansyah, 2013).

1.1. Data Collection The interview were held on August-September 2016 at cafe or workplaces. Interview were conducted by using a digital voice-recorder and lasted around 60 minutes. The participant is three doctors, three patients and one online marketer. During the interviews, the researcher were asked the participant about doctors based online consulting methods. The research question included : How they used internet in the daily life? How they think about e-commerce? Can they explain about telemedicine? How they think if the doctors consulting methods given as online consulting methods?, etc. 1.2. Data analysis The interviews were transcribed verbatim and read repeatedly by the first author. The data is reduced to matrix form to make it easier for researchers and readers to view the data systematically. No software for coding of data was used, but hand coded as a means to gain a deeper understanding of the data. Credibility of research in this research by using triangulation technique. Triangulation is a validity test using more than one source, the source in question can be perspective, methodology, data collection techniques, etc. (Herdiansyah, 2012). In this study, we chose to use data triangulation. Data triangulation is the used of more than one method to collect data for a single case. Results 1.3. Patient Perception Patients argue that the internet is very important in everyday life and is often used to search for information and latest news, buying and selling transactions of goods and services, banking transactions and social media. E-commerce has proven to be frequently used by patients and is very convenient, save energy, time, effective and efficient. But when it comes to healthcare, patient’s perceptions are different, health care according to patient’s expectations are not a playful service. Doctorized services selected by patients are professional and credible doctor services that can provide solutions for patients and make patients satisfied. When this health service is provided online, according to the patient, it is a new and unfamiliar thing but a good and interesting idea because abbreviate can shorten the time, but the concept of implementation should be considered and will cause pros and cons. Of particular concern is this can lead to miss communication between doctors-patients because doctors can not check the patient's body condition directly. In addition, confidence in physicians examining patients also affects this service. If the service is provided by a physician who can be trusted by the patient, then the patient's perception of the service will increase. In fact one of the respondents was quite often consulted online with friends who are also doctors by using social media

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such as line or whatsapp. In addition to a trusted doctor, the appearance of a doctor while consulting online will have an effect on the patient's trust. This service is chosen by the patient because it is fast and time-saving, in addition to patient complaints can be explained in detail through e-mail writing vice versa. This service makes it easier to find a doctor. According to the patient, a suitable price for this service can be the same as face-to-face. This service may be provided as a follow-up of the patient's condition. When a patient has met a doctor who treats the patient, the patient's confidence in the doctor will be better and when the doctor provides follow-up services online, the patient is more likely to complain. For system problems, in the patient's perception, a system that can be expected is an online physician consultation service and then the physician sends the drug home or sends a medical delivery service to the patient's home. 1.4. Doctor Perception Doctors often use the Internet to search for research journals, latest treatment information and the latest news. E-commerce also facilitates doctors in the middle of busy, closer consumers and service providers and is often used for the purchase of goods and services. When associated with health services, good doctor service is a service that can provide subjective and objective satisfaction, in which patients and their families become satisfied. When this service is provided online, according to the doctor is a good idea and visionary which is often used in the doctor's practice just renewed, if used only using the phone, now using a smartphone but of course this service can not replace the traditional face-to-face medical services directly. Online physician-based consulting services can not provide medical and prescription drug treatment services. Besides, doctors also can not examine the patient's body directly, although it is from the patient's anamnesa or complaints, the doctor has been able to predict a lot of diagnosis. Constraints that may be encountered when consulting online is the poor connectivity that can disrupt the consultation. According to doctors, a suitable price for this service is the same as face-toface. The expected system is an online booking system and a consultation system with a medical record that can see the facial expression of the patient directly and the whole body. Online-based doctor services can also be a channel for new doctors who want to make their name better known. 1.5. Online Marketer Perception Online marketers every day use the internet to live online business. Ecommerce can be the answer to the problems of people in Indonesia. When the world of medicine penetrated the online world, according to this online marketer is an innovation in the medical world. The limitation of online consultation is consultation using only the two senses ie the sense of sight and hearing but with the video call feature, it actually can improve service. This service is very time saving and whenever can be done. It just can not provide medical treatment and examination of the patient's condition directly. The price that is suitable for this service is the same as face-to-face as the doctor must provide the equipment that supports the service. The recommended system can book online and consult with video call. Online system can be a channel

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for doctors and doctors are advised to make videos about health to promote the services of doctors. Disscussion From our study we found that doctors, patients and online marketers had similar perceptions in viewing this problem. They perceive that online doctor-based consultation is a new and visionary one. But they argue that to be realized, this needs a lot of consideration and things to watch out for. Starting from the system, the doctor, the type of service, the price, and many other factors must be considered. The respondents thought that online-based physician services could be provided to complement the physician's services, but should be provided in a professional manner so that it can be accounted for and delivering the appropriate quality to the needs. The respondents also agreed that the service could not provide direct medical treatment, but only limited consultation. But do not rule out if in the future technology becomes more sophisticated and found special tools that can help doctors check patients from a distance. Some of the systems perceived by respondents are video call services and emails that can clearly document the patient's complaint and the doctor's explanation or medical record from the doctor's side. Meanwhile, online booking system is also a service that can be imagined by respondents. However, there are some methodological limitations in this study. Specifically, the generalizability of sampling is a limitations of this study. The study was conducted in Surabaya city and age limitation from 20 to 40 years old. It is important to note tha the readers should be cautious when generalizing the results to different cultural context and age. The study was done in-depth interview only with 3 docotrs, 3 patients and 1 online marketer. The results should be confirmed with a reliable survey, more sample and different sector firms. Conclusion Online Medical Consulting service is a new and visionary, but this service can not exchange traditional method. This services can be used as a follow-up or first aid, but this service is only as far as consultation, can not give medical treatment. Online medical consultation can be a channel to connect communication between doctor and patient. This service involves two kinds of senses, namely the sense of sight and hearing. Ideally this service uses a webcam. Based on the research that has been done then can be given suggestions as follows : for practical tips, it is recommended for doctors to work with information technology developers to collaborate on designing telemedicine. Telemedicine that can help doctors examine patients indirectly. Also, it is recommended for doctors to study communication techniques that can help the patient-patient communication indirectly to improve health services. For academic suggestions, for further research can be examined the utilization of online consultation in checking the patient. Can also be feasibility study of online applications that have been developed.

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REFERENCES Al-Mahdi, I., Gray, K. and Lederman, R. (2015) Online Medical Consultation : A review of literature and practice. CRPIT - Health Informatics and Knowledge Management 2015, Vol. 14, pp. 97-100. Armstrong, Gary., Kotler, Philip. (2012) Marketing an Introduction. United Kingdom : Prentice Hall. Badan Pusat Statistik. (2012) ‘Penduduk Indonesia menurut Provinsi 1971, 1980, 1990, 1995, 2000 dan 2010. Avaible at : https://www.bps.go.id/linkTabelStatis/view/id/1267 (Accessed : 28 April 2016) Bakic-Miric, N.M., dan Bakic, N.M. (2008) Successful Doctor-Patient Communication And Rapport Building As The Key Skills of Medical Practice. Facta Universitatis Medicine and Biology, Vol. 15(2), pp. 74-79. Chaffey, D., Ellis-Chadwick, F., Meyer, R., and Johnston, K. (2009) Internet Marketing Strategy, Implementation and Practice. England : Pearson Education. Chen, Z., Li, R., Chen, I., and Xu, H. (2011) A Survey Study on Consumer Perception of Mobile Commerce Applications. Procedia Environmental Science, Vol. 11, pp. 118-12. Creswell, John W. (2009) Research Design Qualitative, Quantitative, and Mixed Methods Approaches. Singapore : Sage Publication. Deloitte. (2014) eVisits : the 21st century housecall. London : Deloitte. Gidwani, N., Fernandez, L., Schlossman, D. (2012) Connecting with Patients Online : E-Visists. Medinfo Tech, Desember 2012. Goldstein, E. Bruce. (2010) Sensation and Perception, Eight Edition. USA : Wadsworth. Gunawan, C.K., dan Wicaksono, A. (2013) Analisa Persepsi Konsumen Terhadap Online Servicescape Website Bakery. Jurnal Hospitality dan Manajemen Jasa, Vol. 2(1), pp. 215-229. Halodoc. (2016) HaloDoc Dokter, Anda Kapan Saja. [Online]. Avaible at : www.Halodoc.com/en/home/ (Accessed : 23 April 2016) Harian TI. (2014) Survei BPS : Jumlah Pengguna Internet Indonesia Tahun 2013 Tembus 71 Juta Orang. Avaible at : http://harianti.com/survei-bps-jumlah-pengguna-internetindonesia-tahun-2013-tembus-71-juta-orang/ (Accessed : 24 Juni 2016) Harrison, R., Flood, D. and Duce, D. (2013) Usability of mobile applications : literature review anda rationale for a new usability model. Journal Of Interaction Science 2013 1:1. Herdiansyah, Haris. (2012) Metodologi Penelitian Kualitatif untuk ilmu-ilmu sosial. Jakarta : Salemba Humanika. Herdiansyah, Haris. (2013) Wawancara, Observasi, dan Focus Groups sebagai instrumen penggalian data kualitatif. Jakarta : PT RajaGrafindo Persada. Horner, K., Wagner, E, and Tufano, J. (2011) Electronic Consultations Between Primary and Specialty Care Clinicians : Early Insights. Commonwealth Fund, Vol. 23, pub. 1554. Kay, M., Santos, J., Takane, M. (2010) Telemedicine Opportunities and developments in Member States. Global Observatory for eHealth series, Vol. 2. Kay, M., Santos, J., Takane, M. (2011) mHealth New horizons for health through mobile technologies. Global Observatory for eHealth series, Vol. 3. Kayral, I. H. (2014) Perceived Service Quality in Healthcare Organizations and a Research in Ankara by Hospital Type. Journal of Ankara Studies, Vol. 2(1), pp. 22-34. Kemkominfo. (2014)‘Kemkominfo : Pengguna Internet di Indonesia Capai 82 Juta’. Avaible at : https://kominfo.go.id/index.php/content/detail/3980/Kemkominfo%3A+Pengguna+Intern et+di+Indonesia+Capai+82+Juta/0/berita_satker (Accessed : 28 April 2016) Konsil Kedokteran Indonesia. (2016) ‘Jumlah Dokter/Dokter Gigi Seluruh Indonesia’. Avaible at : www.kki.go.id (Accessed : 28 April 2016).

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Konsula. (2016) Konsula, Sahabat Keseharan Anda. [Online]. Avaible at : www.konsula.com (Accessed : 23 Maret 2016) Lesperance, Bernard., et al. (2015) The Telemedicine and Information And Communications Technologies. Canada : College Des Medecins Du Quebec. Moleong, Lexy J. (2013) Metodologi Penelitian Kualitatif. Jakarta : Rosda. Noel, Hayden. (2009) Basics Marketing 01 : Consumer Behavior. Singapore : AVA. Peter, J. Paul., Olson, Jerry C. (2010) Consumer Behavior and Marketing Strategy. New York : McGraw-Hill. Peter, J. Paul., Donelly, James.H. (2013) Marketing Management Knowledge and Skills. United States of America : McGraw-Hill. Qiang, C. Z., Yamamichi, M., Hausman, V. And Altman, D. (2011) Mobile Applications for the Health Sector. Washington D.C. : ICT Sector Unit World Bank. Sangadji, E. M. Dan Sopiah. (2013) Perilaku Konsumen Pendekatan Praktis Disertai : Himpunan Jurnal Penelitian. Yogyakarta : Penerbit ANDI. Schifferstein, H.N.J. and Hekkert, P. (2008) Product Experience. Hungary : Elsevier. Schiffman dan Kanuk. (2016) Consumer Behavior. United Kingdom : Pearson. Schiffman, Leon. (2014) Consumer Behavior. United Kingdom : Pearson. Singh, J., Badr, M. S., Dieber, W. et al. (2015) American Academy of Sleep Medicine (AASM) Position Paper for the Use of Telemedicine for the Diagnosis and Treatment of Sleep Disorders. Journal of Clinical Sleep Medicine, Vol. 11(10), pp. 1187-1198. Solomon, Michael. (2010) Consumer Behavior. United Kingdom : Pearson. Statista. (2016) ‘Number of smartphone users in Indonesia from 2011 to 2019’. Avaible at : http://www.statista.com/statistics/266729/smartphone-users-in-indonesia/ (Accessed : 24 April 2016) Turban, Efraim., Rainer, R. Kelly., Potter, Richard E. (2005) Introduction to Information Technology. United States of America : John Wiley & Sons. Wahyuni, T., Yanis, A., dan Erly. (2013) Hubungan Komunikasi Dokter-Pasien Terhadap Kepuasan Pasien Berobat Di Poliklinik RSUP Dr. M. Djamil Padang. Jurnal Kesehatan Andalas, Vol. 2(3), pp. 175-177.

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BUSINESS DEVELOPMENT FEASIBILITY STUDY OF ARCHITECT CONSULTANT A 1

Antoni Widiya, 2David Sukardi Kodrat♠ Ciputra University Surabaya INDONESIA Email : [email protected] ABSTRACT

The purpose of the study is to determine the feasibility of the development of the business conducted by Architect Consultant A. Research method used is based on the analysis of 6 aspects of business feasibility study, the aspects of Business Environment, Markets and Marketing, Legal aspects, Engineering and Operation , Management and HR and Finance The results of the analysis of each aspect showed positive results stating that the Business Development conducted by Architect Consultant A feasible to run. Percentage average income Architect Concultant A is 34,87 % every year, during 2013-2016. Four methods are used as tools to calculate the financial aspect consultant architect A feasibility. Net Present Value (NPV) method shows a positive value of Rp 4.391.250.083. Internal Rate of Return (IRR) to calculate business development feasibility study Architect Consultant A is 11,368 % higher than interest rate is 10,50%. Payback period (PP) method Architect Consultant A is 5 month 19 day 4 hour 48 second. Profitability Index (PI) method value is 8,76 > 0. In Conclusion, Business Development feasibility Architect Consultant A is feasible (feasible) realized from, Business Environment aspects, Markets and Marketing, Legal aspects, Engineering and Operation , Management and HR and Finance. Keyword: Feasibility study, Business development, Consultant, Architect

INTRODUCTION Architecture is a combination of art and engineering, of which comprised of several processes, such as planning, erection, and finishing. Human habitual requirements and complex personal preferences are an integral part in the space making process. A person as an individual and a person as part of the society as a group is always put in the center of all the considerations and decisions to be made. Indonesian architecture consultancy practice has been on the rise these past few years. Appreciation towards architecture design has been on a steady rise as it is directly related to people appreciation of the art of building aesthethics. Such increase can be seen from the growing demand for construction projects, both in the number of the project and the value of each individual project.

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In Indonesia alone, construction boom can be traced from 2012 to 2015. Indonesia enjoyed 13.49% increase during year 2012, and 10.83% increase during year 2013, and a 10.2% increase during year 2014. In average, Indonesian construction sector enjoyed a 11.51% growth in each year during the aforementioned period. In the discussed period, architecture consultancy in Indonesia are having its huge increase in growth in direct relation with the growth of its construction sector. Consultant A has enjoyed a 65,74% increase of total annual revenue from the period of opening in 2012 to mid 2016. The mentioned consultant is being led by 3 principals from 3 different construction business. Its average increase in yearly revenue from 2012 to 2016 is 34.87%. According to the data provided by consultant A, it is apparent that Indonesian architecture consultancy business is a rewarding and potential business that has an increasing trend in Indonesia. Consultant A with 6 employees, comprised of 2 senior architects, 2 junior architects, 2 drafters and led by 3 principals. In December 2015, a review is being made regarding the consultant business feasibility. The increase of income from 800 million rupiahs to 3.2 billion rupiahs is being analyzed through 6 business aspects, i.e. business environment aspect, marketing aspect, technical and technology aspects, management and human resource aspect, and financial aspect. The result from such study is being discussed in this master degree thesis. The theoritical benefit from such research is expected to give positive contribution towards further study in business development in building construction sectors, particularly the architecture design consultant. As the indirect consequence, this can become inspiration and positive push for new start-ups in architecture design company in particular, and Indonesian building construction business in general. The scope of study that is included in the discussion is factors that may result in increase of the firm total revenue reviewed in accordance to the 6 aspects that is mentioned earlier. LITERATURE REVIEW Previous research Analytical Feasibility Study of Investation in Development of PT. Aneka Andalan Karya The feasibility study of Investation in Development of PT. Aneka Andalan Karya of which purpose is for assesment of the its expansion plan, through the calculation of its investment value compared to the margin of expected company revenue. This study is conducted using aspects such as marketing aspect, production method and technology aspect, management aspect, human resource aspect, legal aspects and economic financial aspects. From those 5 aspects the result hopefully can give indication of the effectiveness of the expansion plan. The calculation comprised of five investation feasibilitiy analysis with the result as follows: Payback Period Method showing the required time for Return of Investment of 311 million rupiah capital in 2 years and 16 days; Average Rate of Return Method showing the average profit rate of 215.91%; Net Present Value Method is showing value of positive 225 million rupiah; Internal Rate of Return Method showing return of interest of 37.7%. Such result indicates a higher potential return in comparison to Indonesian common bank interest rate of 14%. By Profitablitiy Index Method results in 1.72 point, which is higher than 1 borderline point. In conclusion based on these 5 calculation methods, such expansion plan in PT. Aneka Andalan Karya is preferred and may result in good company growth. Analytical Feasibility Study of Initial Capital Investment for the Purpose of Opening New Branch Dealer of Chanel Multi Wijoyo Motor.

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Feasibility study is one analysis that involves an in depth study of one business activity that is being conducted in order to make a clear decision on its feasibility. Data and variables that is being used in the study is the amount of initial investment, estimated revenue, estimated operational cost, and estimated profit or loss. The collected data will be analyzed by Payback Period Method, Net Present Value, Profitability Index, and Internal Rate of Return. From such calculations, it is derived that the Payback Period is 1 year and 9 months, of which is much shorter than the ideal required period of 3 years. NPV or net value is 137 million rupiah more than 0, which is considered a positive or preferred result from the 197 million investment. PI value is 1.7 times bigger than the expected Rate of Return of Investment. IRR is at 37.752% bigger than common interest rate that is being use as loan, at 6%. Calculation results from aforementioned result shows a positive result, and it is concluded that this is a sound investment. Business Feasibility Study Feasibility study is a research conducted with the purpose of making an informed decision regarding the commencement of the business steps. One business can be said feasible if the idea can bring bigger benefit for all stake holder compared to negative benefit that may be incurred (Suliyanto, 2010:3). According to Suliyanto (2010:8) the activity of business feasibility study not only beneficial for starting up a business, but also for business owner that is in the middle of these activity: starting new line of works, developing scope of works, choosing the best investment / project with the most potential benefit. According to Kashmir and Jakfar (2012), there are 5 purpose in doing feasibility study, as follows: avoiding the risk of loss, assisting the process of planning, assisting the process of work, assisting audit and monitoring, assisting control. Business that is being assessed has been operating for 4 years, hence the researcher decide to conduct the feasibility study under the category of developing business. In this stage, there are several aspect in needs of discussion, as follows: business environment aspect, marketing aspect, legal aspect, technical aspect, management and human resource aspect, and financial aspect. Business Environtment Aspect Politic Economy Social Technology Analysis, according to Ireland (2013, 36 – 44), refers to general environment outside the company. Environmental aspect will have effect towards the whole industry including the company within it, with various degree and level of influence. After the assessment of PEST factor, the result can be described in External Factor Analysis Summary for consultant A, that will be detailed further into Opportunity and Threat for the company. Kodrat (2009) explains that discovery of new strategy and clear assesment of one competitive edge, can be analyzed through five forces model. Included in this model are: competition among the industry, threat of new comers, threat of substitute goods, demand of such service, and supply of such service. Internal analysis description is known as Internal Factor Analysis Summar or IFAS, in which the company will have insight of its Strength and Weakness. The Strength Weakness Opportunity Threat (SWOT) analysis is a historical technic that is being used to deliver a clear and complete understanding of company strategical positioning (Kodrat, 2009:122). SWOT analysis is being conducted by analysing internal factors (strength and weakness) and external factors (opportunity and threat). Marketing Aspect Kashmir and Jakfar stated that if proper analysis does not given to marketing, specifically on the business future potential, it may lead to the failure of the company in accomplishing its goal. It is highly probable to rise a threat towards livelihood of the company. A marketer must have a complete knowledge of the market that is going to be penetrated, for example: the availability of

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the market, including its size, potential, competitive level, and the size of market share that is being contested by the rival business (2012:40-41). Segmentation, Targeting, Positioning (STP) Analysis is a series of marketing strategy with a purpose of producing company policy in each own respective context (Suliyanto, 2010:93). Marketing mix is a combination of seven variables in marketing system that can be managed by the company (Suliyanto, 2010:83). The services that is being offered by the company, that can deliver benefit, bring fulfillment towards consumen needs, and cause satisfaction is explained in the format of 7P (product, price, people, place, promotion, process, and physical evidence). Legal Aspect Legal aspect assess the legal requirements for conducting the business. Each business may have various legal requirements that is dissimilar and may depend to the complexity of the business itself (Suliyanto, 2010:15). The purpose of legal aspect, as explained by Kashmir and Jakfar (2012:24), is to give answer to the enquiry of authenticity and the completeness of the legal documents supporting the business. Specific analysis of such law in the feasibility studies, according to Suliyanto (2010:16), is being done by analyzing busines legal documents, analyzing the appropriateness of business legal standing towards the business idea to be conducted, analyzing the ability of a business in its law conformity, and analyzing legal warranty that is available if the business is being run on loan. Technical and Technology Aspect According to Kashmir and Jakfar (2012:150), technical or operating aspect also known as productioin aspect. The analysis of this aspect is to gain assessment of company ability in conducting its core business. It is being evaluated based on its location, area of production, layout and the performance of production machines. Management and Human Resource Aspect Analysis of management and human resource aspect give an evaluation of workers availability, both in quality and quantity for conducting business operation (Suliyanto, 2010:158). According to Fahmi (2014:103) in evaluating the feasibility of human resource aspect, comfortable working environment is one of the utmost important factor. In this context, it is expected to build a psychological mechanism contract.

Financial Aspect Finance is an aspect that is used in the assessment of company whole monetary condition (Kasmir and Jakfar, 2012:89). Both profit oriented business and non – profit oriented business needs to carefully address the financial aspect before conducting its business. Profit oriented business will make decision that lead to financial profit, while non – profit business study its course of action based on the ability to deliver its activity for accomplishing its altruistic mission (Suliyanto, 2010:183). Feasibility study in financial aspect will be conducted by the study of Net Present Value (NPV), Interest Rate of Return (IRR), Payback Period (PP), and Profitability Index (PI). Future financial projection in revenue will also be conducted in three different scenarios, which are pessimist scenario, moderate scenario, and optimist scenario. RESEARCH METHODS Based on its purpose, this research can categorized as evaluation and development research, with the following reasons: 1. Providing information and also act as an evaluation of further business development. the evaluation will include the feasibility of such expansion.

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2. Showing clear information on the possible alternatives for the purpose of making full informed decision. Based on its method, this research falls on the qualitative research group, with the following reasons: 1. Reliance towards subjective interviews with first hand sources, conducted in inductive approach during decision making process of the derived conclusion. 2. In accordance to the research problems, the omission of research structure and theoritical structures is the result of focusing on verifying initial theory and keeping the natural setting phenomenon. The research took place in Architecture Consultant A, located in Jalan Darmo Baru Timur 5 no 16, Surabaya, 60189, East Java. The research thesis is conducted from 2016 May in the period of 6 months. The research is expected to be completed on 2016 November. Problem identification is based on research objects and literature study focusing on actual problems faced by the company. The subsequent steps including the definition of problems as the research scope, and the assumed problem that can be analyzed in both internal and external factor. The result of such process will become the base of 6 aspects feasibility study assessments. 12 steps of the research is as follows: 1. Interviewing first hand sources, including the process of making transcripts as provided in the appendices. The interview is conducted towards 8 informants, as follows: a. Mr. Leonardo (code PL – Appendix A) b. Mr. Andi Santoso (code AS – Appendix B) c. Mr. Samudaya (code SD – Appendix C) d. Mr. Stefanus Kwok (code SK – Appendix D) e. Ms. Ivana (code IV – Appendix E) f. Ms. Vicky (code VS – Appendix F) g. Mr. Louis (code LP – Appendix G) h. Mr. Tiong Bing (code TB – Appendix H) 2. Synthesizing and crystalization of the previous result into 6 table of business feasibility study, in the format of interview induction table. 3. Data analysis with 6 aspects towards 8 inteviewees regarding external and internal factors that may affect the consultant company A. Data Analysis validation will be written inside quotation marks bracket (“ “) along with codes as follows: “Direct interview quote” (A-B, C-D) A = Characters referring to appendix section mentioned B = Page number of the mentioned appendix C = Line Number at the start of the quote D = Line Number at the end of the quote Example: (A-7, 3-4) signifying Appendix A, page 7, from line 3 to 4 in page A-7. 4. Business Environment Aspect which covers external factors of Indonesian building construction sector. The addressed factors are politics, economy, social, and technology or PEST Analysis that will be summed in opportunity and threats. 5. Internal factors of consultant A, by evaluating Five Forces Model, comprised of newcomer threats, supply power, demand, substitute services or products, competition. The result will be summed in strength and weakness. 6. SWOT analysis matrix to be further developed into SO (growth), WO (stability), ST (diversification), WT (turnaround), to develop strategy for further growth. 7. Marketing Aspect, which comprise of two part, STP analysis and 7p – marketing mix analysis.

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8. Legal Aspect, particularly in the effort to gain professional architecture certification, in this case SKA (Sertifikat Keterangan Ahli) from IAI (Ikatan Arsitek Indonesia) 9. Technological Aspect that is directly affecting production process, comprised 2 parts: hardware and software 10. Management and Human Resources Aspect, that will be broken down into 3 parts, as follows: organizational structure, workload anaylsis, and incentives salary. 11. Financial Aspect, discussed in NPV, IRR, PP, PI, and future possible revenue. 12. Conclusion and Managerial Implications that is important for the company development. RESULT AND DISCUSSION Business Environment Aspect The analysis result based on PEST analysis shows that the architect company A growth is directly influenced by Indonesian economic and political condition, as a result of good government policy. This condition result in higher investment from private sectors and investors. Economical factor directly correlates with increase of society buying power and the increase of technology adoption. The increase of contemporary technology immersion, in return will lead to higher productivity and quality. Social condition is deemed not to be significant towards the architecture company. Internal strength analysis through Five Forces Analysis shows that consultant A is quite competitive in facing new substitute industry. Consultant A effort in adding its competitive edge by picking its marketing niche in a specific market target. There is no evident substitute product nor service. Negotiation process and contract dealing process is easier if prior identification and screening has been thoroughly delivered PEST analysis will result in opportunity and threat data, while Five Forces analysis will result in Strength and weakness information. From this step, a further SWOT analysis is conducted with the purpose of finding the effective development methods. From Company A SWOT Analysis, it is found that Quadrant 1 strategy that can be categorized as part B, or Stable Growth Strategy. This is a beneficial and preferred condition, of which a company have the ability in making the best of available opportunity and potential. Further development of company A, may require stable and gradual growth mirroring Indonesia economic growth, while maintain top tier project portfolio until the expected revenue of 3.2 billion is reached. Marketing Aspect Analysis of STP factors shows the utmost importance are, the correct market positioning, both geographical coverage, demographic of client, psychographic or social class, and behavioral including client benefit and user loyalty. By proper marketing execution, the marketing strategy will be clear and focused. The company positioning has a strong tendency towards commercial project, and may be detailed further in the future time. If an architecture design firm can maintain its quality and provide more added benefit for the building or project owners, it will earn the company a strong clientele that in turn, will lead to strong stream of projects. Such strong presence in the industry, coupled with competitive pricing will ensure the company business sustainability. Market Analysis of architecture consultant company A shows a majority of commercial project loacated on the major islands of Indonesia, such as Java, Sumatra, Kalimantan, Sulawesi, Bali, Nusa Tenggara, Irian. The specific marketing niche of commercial building provide a strong contribution for company A to gain an considerable revenue, compared to private residential oriented architecture company. The company is expected to achieve gradual increase in commissioned project income from 800 million to 3.2 billion by this step.

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Market positioning of company A shows a high degree of competitive edge, compared to similar consultant, particularly in Surabaya, the company base city. The company have an arguably better service for the industry, due to a higher understanding of construction working drawings that lead to better drawing and technical documentations. The principal various insight and experience in construction sector make the company able to understand the industry from a multi faceted point of view. The company strife to keep its quality with the goal to create a good environment, as stated in the company vision ”Together We Shape the Better World.” The company pricing is classified based on the project size and difficulties. The pricing range from private residential project, spirituality / religious project, hospitality project, and commercial project. Marketing Mix analysis of company A comprised of 7 combinatorial “P” variables, including Product, Place, Price, Promotion, People, Process, Physical Evidence. From further investigation and case study, it is evident that 3 variables are held more importance to the young architecture company, compared to the rest. The variables are discussed as follows: 1. Product, is the utmost important variable for architect due to a clear STP. A Specific project knowledge and deep understanding of the required service give a strong boost in marketing possibilities. A finished projects presented in company portfolio is one of the biggest factors that may lead to future commissioned projects. 2. People, as architecture consultant gravitates heavily on specific design service, skilled and trained work force is essential. A good designer is expected to have good technical skills, good human behavior and preference understanding, pleasant attitude, and great communication skills. 3. Process is an important factor in increasing production efficiency. Highly efficient process will lead to lower production and operational cost. The rest of the factors relies heavily on how the development of the first three factors. i.e. Great service in itself is a good promotion. Legal Aspect Company A has increase its legal presence and requirements for architecture consultancy business. Due to its commercial projects positioning, it is mandatory for the company to be recognized as a legally sound firm. This is due to the benefits of legal protections, such as clear separation of private responsibility from company responsibility, clear and more transparent financial and tax process, to name a few. Hence, the company A has progressed on forming PT. Another important legal aspect is recognition of local architecture board. In this case, the local architecture board refers to IAI (Indonesian Association of Architect). A recognition in the form of proper training and certification may provide the company with stronger credibility and possible legal defense when such requirement arises. In 2016, the 3 principals of the company has finished all of the training level provided by the association and has been recognized as nationally registered architect. Technological Aspect Company A current location is situated in a residential vicinity. Such location give contribution to the nice and quiet atmosphere for the office, that is essential in the creative design process. Continuous computer hardware and software update also held a certain amount of importance due to the industry heavy reliance towards technology. The 3 years computer equipment life span is a must for the company. Human Resource and Management Aspect.

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Company A daily operation is based on its organizational structure. the current structure is quite simple and straightforward. The team mainly consist of designers, divided into three level, principals, seniors and junior architects. Further development may require additional administrative forces and financial accounting staff. Clear communication of the structural organization is important for the seamless interaction during the whole process. Further improvement may also include level of career for the staff, up to the level of associate or partner.

Job description each of the consultant component covers the range of position available and the function of each position. The current range of position is junior architect, senior architect, principal, and supporting roles to the whole consultancy business. Complementing services such as structural design, mechanical electrical design, interior design are being outsourced to independent consultant, and may be offered to the client when the demand is present. Compensation and reward system for the employee are divided into several incentive package based on the position and the contribution given. Prior work experiences and display of skill also being accounted as one of the factor in the staff salary and commission. Additional bonus based on work performance are scheduled to be given at the end of each financial year. Financial Aspect In order to reach 400% increase of income, the company focus is mostly put into finding new clients. Factors that are being put into considerations are estimated cost, estimate income projection, estimated profit, estimate change of capital, estimated cashflow in 2016 to 2019. Net Present Value of company A is 4 billion rupiahs. Based on this founding, company A is deemed to be business feasible. Interest Rate of Return shows the value of 11.37%. This value is higher than expected ideal value of 10.50%. Based on IRR analysis, company A is deemed to be business feasible. Payback Period analysis shows the expected investment payback to be made on the following year. Based on the current financial performance, company A is able to breakeven the initial investment in 5 months 19 days 4 hours and 48 seconds. Company A is deemed to be feasible based on the payback period analysis. Payback Profitability Index of company A is 8.76. This value is higher than the expected borderline value of 0. Based on this result, company A is able to be developed as a feasible business. CONCLUSION The final conclusion of the feasibility study, the architecture business consultant A is feasible after its assessment in business environment aspect, marketing aspect, legal aspect, technical aspect, management and human resource aspect, and financial aspect. In the case study of architecture firm start-ups below 6 years, it is possible for them to focus only on some of the 6 aspects. During their growth it is essential to continue to strive and develop other aspects as well. In future research, it is expected to focus on architecture firms and its senior principals as it may give further insight on the operation process inside a construction consultant company. REFERENCES I. Delaney, R, P., Whittington, & O.Ray. 2010. Business Environment and Concepts. New Jersey : John Wiley & Sons,Inc. . Fahmi, I. 2014. Studi Kelayakan Bsnis Dan Keputusan Investasi . Jakarta : Mitra Wacana Media.

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Herdiansyah, Haris. 2010. Metode Penelitian Kualitatif. Jakarta. Salemba Humanika Ireland, R.Duane, Hoskisson, Robert E., & Michael A. 2013. The Management of Strategy Concepts and Cases, 10 th . Canada : Nelson Education, Ltd. Kashmir, & Jakfar. 2012. Studi Kelayakan Bisnis. Jakarta: PT Kharisma Putra Utama. Kodrat, D. S. 2009. Manajemen Strategi : Membangun Keunggulan Bersaing Era Global di Indonesia Berbasis Kewirausahaan. Yogyakarta : Graha Ilmu . Kotler, Philip, & Keller , K. L. 2009. Manajemen Pemasaran . Klaten Utara : PT. Macanan Jaya Cemerlang. Nurjanah, S. 2013. Studi Kelayakan Pengembangan Bisnis Pada PT Dagang Jaya Jakarta . 2028. Rangkuti. 2012. Analisis SWOT:Teknik Membedah Kasus Bisnis. Jakarta: PT. Gramedia Pustaka Utama. Subagyo, A. 2011. Modul Studi Kelayakan Bisnis. Jakarta : PT.Elex Media Komputindo. Sugiyono, P. D. 2013. Metode Penelitian Pendidikan Pendekatan Kuantitatif, Kualitatif, dan R & D. Bandung: Alfabeta . Suharsimi, & Arikunto . 2010. Prosedur Penelitian Suatu Pendekatan Praktis . Jakarta : Rineka Cipta.

Suliyanto. 2010. Studi Kelayakan Bisnis:Pendekatan Praktis . Yogyakarta : Andi.

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DECISION OF PT. S TO CONTINUE OR DISCONTINUE A SEGMENT OF CERTAIN PRODUCTS USING RELEVANT COST ANALYSIS Christian Boby Widjaja, 2Wirawan E.D. Radianto♠

1

Ciputra University Surabaya INDONESIA Email:[email protected], [email protected] ABSTRACT PT. S is a company engaged in the fields of air conditioning service and general contractors in Surabaya. PT. S currently has four business segments, which became the supporting pillars of the company, among others: the individual services, the company services, spare parts sales service to individual, and spare parts sales service to companies. Efficiency is the key to be able to compete with other companies, so that author in this study using analysis of relevant costs combined with non-financial aspects (qualitative). This research approach using qualitative methods. Interviews and the documentation is data collection techniques performed by the author, and the data validation technique used is member check. The results of the study data is based on analysis of the relevant costs, indicates that one business segment or individual services suffered a loss of Rp. 28.239.500,- but when the results of analysis of the relevant costs is combined with non-financial aspects (qualitative), it is known that the first business segment is a marketing tool used by PT. S to get customers in other segments, so that if the first business segment discontinued, it will affect the other business segments and increased promotional costs in other segment. Based on these results suggested (1) PT. S update the fee structure so that the determination of the selling price and profit of each business segment is measured. (2) PT. S opened up opportunities to cooperate with other air conditioning companies, to expand the network of existing services. Keywords: relevant costs, qualitative, cost structure, air conditioning service.

INTRODUCTION According to a meterology organization data in 2016, Surabaya has experienced an increase in temperature every year, for example in 2012 the average temperature in Surabaya reaches 28 degrees Celsius, and in 2016 the average temperature in Surabaya get to 31 degrees Celsius. With the increasingly hot city of Surabaya, it encourage AC (Air Conditioning) service business owners to think creatively and efficiently to win the competition on this business. Every AC service business owner strives to be the best by providing better service compared to other AC service companies, they are able to offer cheaper rates, 24-hour service, to after-sales service.

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Related to the description, the authors conduct research on PT. S, which is a company engaged in the field of air conditioning services and general contractors with a range of areas in Surabaya and Sidoarjo by way of calculating the relevant costs to several sub areas in PT. S. Starting from the evaluated financial statements of the year 2015, PT. S experienced a period of stagnation, and turnover of this company from July 2015 to June 2016 did not experience a significant improvement. When the turnover did not increase, but the quality of service should continue to be improved then the efficiency should be applied, which is the efficiency in the use of materials such as freon, copper pipes, and other materials, so that these efficiency results can be diverted to improve the quality of services such as providing air freshener to the customer. Customer of PT. S mapped into 4 products, Product 1 is an individual with air conditioning service type, including minor air conditioning improvements such as washing the air conditioner, repair the remote air conditioner. Product 2 is a company with air conditioning service type. Product 3 is an individual with spare parts sales services type, includes replacement-replacement tools or items contained in the AC as copper pipe replacement, replacement of the compressor, the addition of Freon. Product 4 is a company with spare parts sales service type. In this study the authors will analyze by using qualitative methods using relevant costs analysis. Relevant cost is useful to see the potential of the 4 customer products, once it is known the potential of the 4 customer products it will be analyzed by using quantitative methods to determine the factors that affect the success of each product, so that PT. S may decide to continue or discontinue certain products. In this study the authors will conduct research using quantitative methods. LITERATURE REVIEW Previous research Tumbol (2014) conducted a cost analysis research relevant to the purpose to determine the most appropriate decision that can be taken by management in making decisions to buy or make your own meatballs using differential accounting information analysis. In this study, the relevant cost calculation was done to compare the costs incurred if Bakso Pasuruan decided to make the meatballs independently and the costs incurred if Bakso Pasuruan decided to buy meatballs to the supplier. At the end of research Bakso Pasuruan decided to make their own meatballs. Cost Simamora (2012: 36), states that the cost is cash or cash equivalent value sacrificed for goods and services expected to benefit the present or the future for the organization. The cost accounting system is to accumulate costs by various natural classifications such as raw materials or wages and classify costs to targeted costs. Relevan Cost According to Horngren and Foster (2008: 446), relevant costs are predicted future costs, while relevant revenues are future earnings which are expected to be different that comes from alternative actions being considered by a manager. Hansen and Mowen (2009: 70), argue that relevant costs are different future costs on each alternative. All decisions relate to the future so that only future costs can be relevant to the decision.

Cost-relevant applications in making decisions Hansen and Mowen (2009: 76), stated that the relevant cost applications in decision-making are:

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a.

Decision to make or buy

b.

The purpose of this decision is to optimize the production resources and financial of the company. Decision-making is often associated with the use of equipment that has not been maximized, empty space, even unemployed labor. Opportunity cost

c.

The decision to choose one alternative and implement it will make the benefits of other alternatives disappear. The benefits are lost because they do not chosen other alternatives called opportunity costs. William (2009: 323), states the opportunity cost is the measured value of the best sacrificed alternative, the negligible value of being ignored because it rejects the best use of the resource. Sepecial order decision

d.

The decision to accept a special order or refuse a special order is strongly influenced by the condition of the company's production capacity. If it operates at full capacity, special ordering will result in a fixed and variable production cost increase, but if the company is still below full capacity, and it is possible to undertake special ordering work, in this case the cost of production is variable, called differential cost. The decision to sell or process further

e.

Manufacturing companies are companies that process raw materials into a product. The production of this manufacturing company can be sold directly to the market or further processed, to add value to the product itself. Management is faced with two choices of selling the product directly to the market or doing further process. The decision continues or discontinues

1.

2.

3.

The manager must decide on a segment or product must be maintained or stopped immediately. The steps taken to make the decision to continue or mengehentikan an existing segment, namely: Collecting internal data companies such as the company's financial statements, then the data is processed and customized for each segment to be studied, after which the data of each segment is processed using relevant cost analysis, so that the figures obtained whether the segment should be continued or discontinued. To strengthen the analysis of the relevant costs interviews should be conducted on the parties concerned, the analysis on each segment will be compared with results of the calculation relevant cost analysis. After comparing the results of the interview with the relevant cost analysis, can be taken the decision to discontinue or continue a particular product segment.

RESEARCH METHODS The approach used in this research is qualitative applied research with case study strategy. Qualitative methods conducted in this study using interpretive approach, because the use of data that will interpreted for decision making to continue or discontinue a segment in PT. S. According Sugiyono (2014) qualitative research method is also called as an interpretive method, because the results of the resulting data with respect to the results of interpretation. The method used to validate data obtained from PT. S is member check. If the data found has been agreed by the data giver, it can be concluded that the data is valid, but if the data found by researchers in various interpretations not agreed by the data giver, then the researcher needs to conduct discussion with the data giver. (Sugiyono, 2012).

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The sampling method used in this research is purposive sample, using data from internal sources and interviews to company owners and financial officer of PT. S. Internal data of the company taken and processed by using the relevant cost analysis. Respondent in this interview is owner of PT. S. Researcher chose the owner of PT. S to be interviewed because the decisions and policies are taken directly by the owner of PT. S, meanwhile to validate each statement from the owner of the company, the researcher interviewed the financial officer of PT. S. Data collection techniques conducted in this study are: 1. Interview Interview techniques used in this study is unstructured interviews, where researchers conducted interviews by not using guidelines that are structured with a systematic. The interview guide used is only used as a guide on the outline of the problem under study. 2. Documentation According Herdiansyah (2010), documentation is one method of collecting qualitative data by viewing or analyzing documents made by the subject itself or others about the subject. This method involves the collection of internal company data including the company's financial statements such as balance sheet, income statement, capital change report, cash flow statement, and notes. Data Analysis Data analysis conducted at PT. S is as follows: 1. Conducting data collection through interviews and research documentation. Documentation collected in the form of financial data, which will be processed into product segments in the PT. S. The interview process is done to the owner of the company, because the decision and the policy in PT. S still depends on the owner in PT. S. 2. Data documentation in the form of financial data gathered are then made the cost structure required by each - each segment and continued using cost analysis is relevant, then the financial data analysis results with relevant costs will be merged or combined with data from interviews to take a decision to stop or continue the production segment Which is in PT. S and factors - factors that cause the segment to be stopped or resumed. 3. Make a decision whether PT. S must continue or discontinue a specific product segment. 4. Draw a conclusion. RESULT AND DISCUSSION PT. S has 4 types of business services that become pillars of income from PT. S, which are interrelated between one type of business with another type of business. This type of business is formed from a combination of the type of consumer that individual consumers and consumer companies, and the type of business that is service-sales services and spare parts sales service. The following 4 types of business segments in PT. S:

Consumer Type

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Service Sales

Spare part Sales

Individuals

Company

1st Product

2nd Product

Segment

Segment

3rd Product

4th Product

Segment

Segment

Service

At the relevant cost simulation conducted by PT. S found that the 1st Product Segment experienced a loss, which resulted in reduced profit margin obtained by PT. S, but the interview result shows that the 1st Product Segment is a means of company to do promotion and become a way for PT.S to get customer in other product segment. So the researcher simulated the relevant cost again, by simulating up to 3 years ahead, with the amount of economic growth 5%. The result is there is a growth in the 1st Product Segment even though the product segment still suffered losses of up to 3 years. CONCLUSION The authors conclude, based on cost analysis relevant to the 4 business segments that exist in PT.S, 1st Business Segment is the business segment that suffered losses, and after the simulation in the next 3 years this business segment experienced growth, although still suffered losses. However, if the relevant cost analysis is combined with non-financial aspects (qualitative), 1st Business Segment is a segment that becomes the key to the creation of other business segments, besides PT. S uses 1st Business Segment as a marketing strategy to create existing customers in other business segments, so it can be concluded that PT. S will not stop the 1st Business Segment.

REFERENCES Ahmad, Kamaruddin. 2013. Akuntansi Manajemen: Dasar-dasar Konsep, Biaya dan Pengambilan Keputusan. Edisi Revisi ke Delapan. Raja Grafindo Persada, Jakarta. Arikunto S. 2016. Prosedur Penelitian Suatu Pendekatan Praktik. Edisi Revisi VI, PT. Rineka Cipta, Jakarta. Halim Abdul, Bambang Supomo, Muhammad Kusufi. 2013. Akuntansi Manajemen (Akuntansi Manajerial). Edisi Kedua. BPFE, Yogyakarta. Hansen dan Mowen. 2009. Akuntansi Manajerial. Buku kedua. Edisi kedelapan. Erlangga, Jakarta. Hansen, Don R and Maryanne, M Mowen. 2012. Manajemen Biaya. Salemba Empat, Jakarta.

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Herdiansyah, Haris. 2010. Metodologi Penelitian Kualitatif Untuk Ilmu-Ilmu Sosial. Salemba Humanika, Jakarta. Horngren Datar dan George Foster. 2008. Akuntansi Biaya Dengan Penekanan Manajerial. Jilid 1. Edisi 12. Erlangga, Jakarta. Kuncoro, Mudrajad. 2009. Metode Riset Untuk Bisnis & Ekonomi. Erlangga, Jakarta. Mursyidi. 2010. Akuntansi Biaya. Cetakan Kedua. PT. Indeks, Jakarta. Salman, Kautsar. 2013. Akuntansi Biaya, Cetakan Pertama. Akademia Permata, Jakarta. Simamora, Henry. 2012. Akuntansi Manajemen. Edisi III. Star Gate Publisher, Jakarta. Sugiyono. 2014. Metode Penelitian Kuantitatif, Kualitatif, dan Kombinasi (Mixed Methods). Alfabeta, Bandung. Warindrani, Armila Krisna. 2006. Akuntansi Manajemen. Graha Ilmu, Yogjakarta. Widilestariningtyas, Ony, Anggraini, Sri, Firdaus, Dony. 2012. Akuntansi Biaya. Graha Ilmu, Yogyakarta. William Carter. 2009. Akuntansi Biaya. Salemba Empat, Jakarta.

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MARKETING STRATEGY FOR SCALE UP BEAUTY CLINICS "NFD" Eko Purwanto, 2David Sukardi Kodrat♠

1

Ciputra University Surabaya Indonesia Email : [email protected]

ABSTRACT The development of the local economy Surabaya, especially western Surabaya, the need for beauty treatments will be greater. On the other hand, the number of beauty clinics are also growing. That is, besides having the opportunity to grow big, the challenges of competitors are also getting bigger. In this research, study and assessment of internal clinical data NFD to know the problems faced in particular in the implementation of marketing strategies. It also examined internal problems related to optimizing the implementation of marketing strategies, ranging from the vision, mission and values of the organization, organizational structure, jobdesc and team competence, performance evaluation that embraces continuous PDCA and market research. From the picture can create a marketing strategy that includes competition strategy (segmentation, targeting and positioning), tactical marketing (marketing mix and differentiation), the value of marketing (branding, service and process). Based on this assessment, there are several ways of settlement. Due to internal conditions that also need improvement, then the way of solving problems that have a combination of various means of solving that includes revamping the vision, mission and values of the organization, organizational structure, job description and competency team, performance evaluation adheres PDCA sustainable and market research to ensure the marketing strategy that includes competition strategy (segmentation, targeting and positioning), tactical marketing (marketing mix and differentiation), the value of marketing (branding, service and process) is applied to run more optimally. Keywords : Internal improvements Management, Mapping Competitors, Implementing Marketing Strategies, Plan Do Check Action (PDCA), Continual improvement.

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INTRODUCTION NFD Clinic located in Manukan Surabaya serving facial and skin/beauty treatments starting in 2010. When viewed from the potential market, actually very large, especially still not many standing beauty clinic. But during 2014, the number of patients / month is still fluctuating / unstable, on average still about 304 patients/month. Even new patients have no meaningful addition, the end of the year tends to fall, on average only 22 new patients/month Based on data on the addition of the number of patients taking care at the NFD clinic, the majority due to Word of mouth, the recommendation of friends or interested after seeing positive changes (the skin and face of friends is much better), indicates that the quality of NFD clinical products and services is good enough, Not optimal marketing system. On the other hand, competitors are very developed, estimating 600 patients / month, whereas NFD first stands in the location than competitors. If the previous competitors only contracted a small shop, now has built the building itself is quite large and very nice Based on these two points, first, the quality of service and product of NFD clinic is good, but still less developed, secondly, highly developed competitors, so we assess the market is still very big, only the potential of NFD clinic that has not been optimized yet. Therefore, this case study / study attempts to uncover the problems of what happened in the NFD clinic, especially those related to marketing. Furthermore, it is expected to provide an alternative solution that can be done NFD clinic to be able to develop the business into a professional beauty clinic, has the advantage and competitiveness, so it can scale up faster. LITERATURE REVIEW Marketing Concepts Marketing is a concept of science in business strategy aimed at achieving sustainable satisfaction for stakeholders (patients, employees, and shareholders). As SCIENCE, marketing is an objective science gained by the use of certain instruments to measure the performance of business activities in shaping, developing, directing long-term mutual exchanges between producers and consumers. As a business STRATEGY, marketing is a market-oriented organizational adjustment action in the face of business realities both in the micro and macro environments that continue to grow. (Ignas G Sidik, 2013, BISNIS SUKSES, Menyusun Rencana Bisnis Lengkap, Terpadu, First edition, Gramedia Pustaka Utama, Jakarta) Marketing Planning and Strategy Marketing planning is a continuous (cycle) process throughout the life of a business, and because the business is constantly changing, the marketing plan must also be constantly changing (up date). A good marketing plan is (see figure 1): 1. Supported by information and analysis of markets, consumers, competitors and even input from marketing consultants. 2. Supported allocation of adequate resources, highly skilled staff and high commitment. 3. Increase opportunities for more experienced and emerging competitors. 4. Allows to recognize and take action on any consumer trends and preferences that other companies will ignore. 5. It is possible to develop and expand the choice of groups of patients faithfully now and in the future. 6. Show others that the company has thought of ways to produce innovative, unique and valuable products, increased opportunities, stable sales and increased profits.

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Vision & Mission of Business External Analysis Market, Customer Competitor, Industry Environment

Internal Analysis Performance, Product, Price, Distribution, Promotion, Salesperson, Financial and R & D

Marketing Goal Profit, Sales, Market Share, Innovation

Business Strategy General Strategy (Develop, Stabilized, Turnound, Harvest, Divested) Growth Strategy (Penetration, Market Expantion, Diversification, Integration) Competitive Strategy (Low Cost, Differentiation, Focus, Aliansi) Marketing Strategic (Segmentation,Targeting, Positioning, PLC, MarketingMix)

Implementation Build skills, Implementation and Evaluation Figure 1. Marketing Planning __________________ Source: Ali Hasan, SE., MM. Marketing dan kasus-kasus khusus. Yogyakarta 2013

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Marketing Techniques. 1. Marketing mix One of the strategies related to the marketing activities of the company is the marketing mix strategy defined by Kotler and Armstrong (1997) which states that marketing mix as the set of controllable marketing variables that the firm bleads to produce the response it wants in the target market. From that definition can be interpreted that the marketing mix is controllable variables are combined to generate the expected response from the target market. And for service business there are 7 elements of marketing mix (Marketing Mix-7p) that is: Product, Price, Promotion, Place, Participant, Process, And Physical Evidence. 1. Product (product) Purchase a product is not just to have the product but also to meet the needs and desires of consumers. 2. Price (Price) According to Monroe (2005) states that the price is an economic sacrifice made patients to obtain products or services. In addition, the price of one important factor consumers in making decisions to make transactions or not (Engel, Blackwell and Miniard, 1996). Price is said to be expensive, cheap or mediocre of every individual is not necessarily the same, because it depends on the individual perception of the background of the environment of life and individual conditions (Schifman and Kanuk, 2001). 3. Promotion (promotion) Promotion is the activity of communicating information from the seller to the consumer or other parties in the sales channel to influence attitudes and behavior. Through advertising a company directs persuasive communication to target buyers and the public through media called mass media such as newspapers, magazines, tabloids, radio, television and direct mail (Baker, 2000: 7). 4. Place (Distribution Channel) Kotler (2000: 96) states that "The distribution channel consists of a set of institutions that perform all activities (functions) used to channel the product and the status of its owner from producer to consumer". 5. People (Participants) Participants herein are employees of service providers or salespeople, or persons directly or indirectly involved in the service process itself, including receptionists, doctors, and beauty therapists. 6. Process (Process) Process is an activity that shows how the service is provided to the consumer during the purchase of goods. Clinical managers through front liners often offer a variety of services for the purpose of attracting consumers. Free physician consulting facilities, product delivery, credit cards, card members and service facilities affect the company image. 7. Physical evidence (physical environment) Physical environment is a condition or condition in which also includes a clinical atmosphere which is where the operation of skin care and skin care services. The physical environment is the most visible aspect of the situation. 2. Differentiation Differentiation is an important part of marketing strategy. Differentiation is designed and implemented by a small or large-scale business management that aims to differentiate factors

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from competitors. Differences are more value for consumers, whether on products, services or brands. Differentiation must have characteristics or advantages that competitors do not have. This advantage is a benefit that is really unique and substantial in the eyes of consumers, the benefits are highlighted required by consumers and become the reason for consumers to use the product or service. Differentiation is known as part of a marketing strategy in the 50s where Rosser Reeves as one of the leading figures of Ted Bates Ad Agency has introduced the term "Unique Selling Proposition" or USP. RESEARCH METHODS 1. Types of research Research using case study research that will discuss about: a. What is the current NFD clinical marketing strategy and system? b. What are the problems faced by the NFD Clinic in developing and implementing the marketing strategy? c. How are alternative solutions to solve the marketing problem? 2. Data and Data Collection Techniques a. Data Type 1. Qualitative Data. The data used by the author in the form of historical data, organizational structure, mission vision, monitoring and evaluation mechanism, strategy and implementation of marketing system 2. Quantitative Data. Quantitative data used by the authors in the form of monthly sales report data (products and services), the amount of inventory, the number of patients, survey results competitors b. Data source 1. Primary data obtained from owners of NFD clinics, company employees, competitors. 2. Secondary data is obtained from the company's monthly reports of competitors, magazines, journals, and others. c. Data collection technique 1. Documentation. The authors collected data from monthly reports of NFD clinics, daily reports, reports of product entry and entry. 2. Interview. The authors conducted interviews with all sections of the NFD clinic, ranging from clinical leaders, personnel, doctors, nurses and administrators to get a more detailed picture of the organization and its jobdes, specific policies regarding marketing. 3. Data Analysis Analysis of data used by the author through several processes, namely: a. Identify problems related to the strategy and implementation of the marketing system b. Provide alternative solutions to problems that arise in designing the strategy and implementation of the marketing system c. Provide a choice of appropriate solutions to solve these problems d. Drawing conclusions from the results of research that has been done RESULT AND DISCUSSION Problem solving input I: Vision, Mission and Values are cultivated.

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Companies must have long-term plans (Vision), efforts to achieve those goals (Mission) and values become a grip in all organizational activities (Value). 1. Vision. "Being the best quality beauty clinic in Indonesia and affordable to all levels of society" 2. Mission. "Always create added value on products and services so as to improve the quality of life for all stakeholders "Always build best relationships with patients to improve product and service quality above patient expectations" "Always provide the highest quality added value to all stakeholders" Problem Solving Input II: Organizational Structure, Jobdes and Competency There should be a clear organizational structure in accordance with its needs and functions. If the resources are insufficient, while the tasks can be attached to existing personnel, what is important is that each position has jobdes and key performance indicators measurable. Problem Solving Input III : Performance Evaluation Using the basic concepts of PDCA (plan-do-check-action), first look for the rootcause conditions resulting in an action plan for improvement. The plan of improvement (plan) that can be done is to provide treatment packages in the previous month with a special price or discount, so that in June patients can still do the treatment without having to pay again. June can be made promo program so that more attractive price of patients come. Furthermore, after the improvement plan is realized (do) a patient's check (check) should be conducted in June, whether corrective action is appropriate and will result in an increase in patient visits. If it is better or has not impacted, it needs to be analyzed the root of the problem continues until the target improvement is achieved (action) Problem solving Input IV: Consistent Marketing Strategy The marketing technique that is executed is correct, it only needs a strategy based on data, done and evaluated continuously so that the clinical performance position is more visible, both in internal map and external map compared to competitors and market availability. Some strategies can be applied with the combination of each quadrant in the SWOT analysis. SO : Educate a sizable market by demonstrating the excess quality of doctors and products from NFD clinics ST : Strength in physician and product quality should be poured in a more professional standard. WO: Appointed a strong operational manager and marketing team because the market is still big. WT: With the operational manager, all services are made more professional, there are standard operational procedures, design, packaging, how to marketing and others. Problem solving Input V: Comparison with main competitors The number of Clinic patients ALMD (competitors) is greater than the number of clinic patients NFD because there are some things more interesting consumers: 1. Doctors are there daily with free consultation. 2. Day of the week many consumers prefer to care. 3. There is a promo discount end of the month, brochures and a nice leaflet. 4. The price is cheaper half to a quarter times. 5. The location is more accessible, more comfortable and more spacious parking.

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Based on the variables of the competitor's advantages, several things that need to be done NFD clinic for improvement are: 1. Doctors need to be there daily, for mild cases, free consultation. 2. The day of the week still opened the service because the demand is also a lot. 3. There are special promos, brochures and leaflets designed better. 4. The price of cheaper products with smaller packaging or post-treatment vouchers. 5. Cooperate with third parties for car parking locations and socialize to consumers

Problem solving Input VI: Combination of input pound I-V problem solving It is a combination of a variety of problem solving alternatives, as each alternative seeks to resolve from a different point of view

CONCLUSION 1. The problems faced by the NFD clinic so that not yet able to do marketing well, the majority due to internal factors: a. The absence of vision, mission and values that become the organization's grip in achieving long-term goals b. There is no clear organizational structure, jobdesc, and competency matrix to drive the organization more optimally c. There is no performance evaluation to know the shortcomings and advantages from month to month so there are no anticipatory steps to constantly improve performance. d. There is no comprehensive and sustainable marketing strategy to attract new patients in particular. c. There has been no comparative study with continuous competitors to know the position of NFD clinics in the market. 2. NFD clinic has not implemented any comprehensive and sustainable marketing strategy. Marketing is only limited to the distribution of brochures and occasional promotion but not programmed 3. To overcome the above problems, the NFD clinic should take the following remedial measures: a. Define the vision, mission and core values of the organization and socialize to all stakeholders within the organization b. Create a clear organizational structure, complete with jobdesc and competencies required, if there is a gap, training can be provided immediately. c. Create ongoing performance evaluations pursuant to PDCA (plan-do-check-action) rules in order to improve performance over time. d. Creating a marketing strategy based on SWOT analysis data. So that more have a clearer picture in segmentation, targeting, positioning and marketing mix sustainable. e. Routine do research or compare with competitors, so better know the advantages and disadvantages of competitors. This data will be very useful in formulating the next marketing strategy.

REFERENCES Ali Hasan, SE., MM. 2014, Marketing dan Kasus-kasus Khusus, Second edition, CAPS ( Center for Academic Publishing

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Service), Yogyakarta. Freddy Rangkuti,Dr. 2014, ANALISIS SWOT,Teknik Membedah Kasus Bisnis, Nineteen edition, Gramedia Pustaka Utama, Jakarta Ignas G Sidik, 2013, BISNIS SUKSES, Menyusun Rencana Bisnis Lengkap, Terpadu, First edition, Gramedia Pustaka Utama, Jakarta Mohamad Wahdi, Drs., MAB., 2011, RISET PEMASARAN, Teori dan Aplikasi untuk Pengambilan Keputusan, First edition, CAPS ( Center for Academic Publishing Service), Yogyakarta. Bernard T. Widjaya, 2010, BRIEF ! Easy Marketing for Executor, Gramedia Widiasarana Indonesia, Jakarta. Freddy Rangkuti, 2003, Measuring Customer Satisfaction, Teknik mengukur dan strategi meningkatkan kepuasan pelanggan plus analisis kasus PLN-JP, Gramedia Pustaka Utama, Jakarta. Mulyadi Nitisusastro H, Dr. 2001, Perilaku Konsumen, dalam perspektif kewirausahaan. Alfa Beta Bandung Danang Sunyoto, Drs. SH., SE., MM., 2011, Metodologi Penelitian Ekonomi, CAPS Yogyakarta. Hermawan Kertajaya, 2016, Marketing in challenging times,Gramedia pustaka utama, Jakarta. Ddidit Darmawan, Dr, ST, SE, MM, 2015, Prinsip-prinsip perilaku organisasi, JP books group, Surabaya Martin Perry, 2016, Mengembangkan usaha kecil, Murai Kencana, Jakarta. Danang Sunyoto, Drs. SH., SE., MM., 2016, Perilaku konsumen dan pemasaran, Center for academic publishing service CAPS, Yogyakarta

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ANALYSIS OF MARKETING MIX ABOUT PEOPLE’S BUYING DECISION OF WALKING REVIVAL PRODUCTS 1

Elia Rapha Tister Nursalim, 2Denny Benardus♠ Ciputra University Surabaya INDONESIA

Email: [email protected], [email protected] ABSTRACT The market value of textile and fashion products industry in Indonesia in the year 2015 reached US$15,19 billion or Rp 208 trillion (13.700 IDR/USD). The industry had grown by 4.7% compared to 2014. According to the calculation of Indonesian Synthetic Fiber Producers Association (APSyFI) sourced from Bank Indonesia, in the last 5 years, the purchasing power of people for textile products rose from 1,21 million tons to 1,75 million tons. The involvement of Indonesia in producing the world's leading products will continue to grow as evident by the vast amount of foreign brands manufactured in Indonesia. This research uses quantitative data by distributing questionnaires on 55 respondents and utilizes multiple linear regression method, supported by SPSS program. The research variables are product, price, promotion, place, and buying decision. The results of this research indicate that buying decision is affected by the quality and design of the product, appropriate price setting, emotional impact of promotions, Instagram as a promotion medium, and LINE@ as a communication medium that connects the seller and the buyers. Keywords: Marketing Mix, Purchase Decision

INTRODUCTION Based on the calculation data from Indonesian Synthetic Fiber Producers Association (APSyFI) that be based on Bank Indonesia asserted that the purchasing power of Indonesians in textile consumption per capita has been increased from 5.03 kg to 6.82 kg in recent 5 years. Syaiful (2015) stated that the involvement of Indonesia in producing world’s leading products will keep on growing. It means that Indonesian fashion industry grows significantly, it can be seen from a numerous of foreign brands which produce their own productions in Indonesia. Indonesia recognizes five religions: Islam, Christianity, Buddhism, Hinduism, and Confucianism. Christian is divided into two: Protestantism and Catholicism. The total population of Protestantism in Indonesia in 2013 was 16.528.513 and the Catholicism one was 6.907.873. The data were taken from the Ministry of Religious Affairs Indonesia. It showed that Christian population exists in Indonesia. Clothing is a primary need of every individual because everyone always wear clothes in their daily life. By in great quantities of clothing industry in Indonesia, Walking Revival was established as clothing business. Walking Revival is an apparel industry which is focus on Tshirts, and special Christianity clothing that is located in Surabaya. Walking Revival is a clothing brand with its vision to share the “Gospel” and bring the revival spirit until the end of

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the earth. “Sharing the gospel and bringing the spiritual victory around the world,” based on the Holy Bible in the Acts of Apostles 1:8 is the fundamental value of the brand. The business is a start-up one since 2015. The means that used as a promotion of the brand are the social media, that is: Instagram and LINE. The followings are the last ten-month sales report of Walking Revival.

Figure 1 The last ten-month sales report of Walking Revival Source: Internal Walking Revival The data in the Figure 1 shows that the selling of Walking Revival encounters both increase and decrease. This is due to the fact that Walking Revival offers Christian-specific T-shirt so that during the high session in Christmas and Easter, the sales increases and the sales decreases once the celebration of Christmas and Easters come to an end. “Marketing mix describes the set of tools that management can use to influence sales,” Kotler (2003). From the statement it can be concluded that the means of marketing mix consist of product, price, place, and promotion. Those aspects are essential for entrepreneurs in managing their business. The sales of the products keep the business going, hence it needs to concern on the four aspects of marketing mix to make the selling number reaches its maximum. Marketing mix can also be the standard for the consumers in making their decision to buy certain products. The social media usage in Indonesia is plentiful as it is shown from the statistics by Indonesian Internet Service Providers Association (APJII) stated that from 100% of total population in Indonesia; 97.4% of them are the social media users.

Figure 2 Internet Usage Behavior in Indonesia 1

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Source: APJII

Figure 3 Internet Usage Behavior in Indonesia 2 Source: ASPJII James Stoner stated, “decision making is an act performed in order to choose a certain way in resolving a problem”. In this case, the decision making depends on the product purchasing, until buying decision is a way of the problem solution whether one should buy the product or not. Ministry of Communication and Information stated that nowadays the number of internet users in Indonesia are approximately 63 millions of people; 95% of them use the internet to access social media. The data indicated that the using of social media in running business is effective due to the plentiful number of social media users. Social media is an easy access medium for entrepreneurs to help managing their businesses without time and place limitation. Based on the previous explanation regarding the background of the study, the researcher found that it is necessary to conduct and analyze the factor of the product, price, promotion, and place towards the decision of the consumers to purchase the product of Walking Revival in social media.

LITERATURE REVIEW Previous Research Firstly, a study conducted by Masrita (2013) entitled “The Influence of Marketing Mix on Purchasing Decision Making Studi on Dekranasda Showroom of Jambi Province”. This study aim was to explain whether there was significant differences from product factor, price, promotion, and distribution towards the decision of the consumers to purchase batik in Dekranasda Showroom. The study also explained the most dominant factor among the factor of product, price, promotion, and distribution in purchasing decision. The research method in the study used probability sampling technique and the number of the sample are 100 respondents. The result of the study simultaneously showed that the variable of the product (X1), price (X2), promotion (X3), and distribution (X4) leveraged significantly towards purchasing decision (Y) of batik Jambi in Dekranasda Showroom of Jambi Province. Partially, variable of product, price, and promotion gave significant impact towards purchasing decision of batik in Dekranasda Showroom of Jambi Province; however, variable of distribution gave less significant impact. Based on further calculation, variable of price became the dominant leverage towards purchasing decision of batik in Dekranasda Showroom of Jambi Province. Secondly, Junio Andreti, Nabila H. Zhafira, Sheila S Akmal, and Suresh Kumar (2013) conducted a study entitled “The Analysis of Product, Price, Place, Promotion, and Service

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Quality on Customer’s Buying Decision of Convenience Store: A Survey of Young Adult in Bekasi, West Java, Indonesia”. The aim of the study was to identify the dominant factors of product, price, promotion, and service quality which leveraged the purchasing decision of customers in Bekasi. The research method used non probability sampling technique and the number of sample were 300 respondents. The result of the study showed that the ones with high impacts toward the customers in making purchasing decision were price, promotion, and service quality. Other research conducted the same topic that held by Ernani Hadiyati (2016) entitled “Study of Marketing Mix and AIDA Model to Purchasing Online Product in Indonesia”. The study focused on finding out as well as analyzing the leverage of AIDA-modeled marketing mix. Marketing mix and AIDA Model gave an impact towards the customers who bought online products. The method of the research used accidental sampling, customers who bought products online, and the number of the sample were 97 customers. Hadiyati employed path analysis as a means of analyzing the data collected. The result showed that marketing mix gave an impact towards AIDA Model. Marketing mix and AIDA Model leverage both directly and indirectly toward the customers in purchasing online products. Based on the study finding, in conclusion, marketing mix leveraged the purchasing decision of the customers in buying online products. Marketing Mix Lamb, Hair, and McDaniel (2006) declared that “marketing mix is a unique strategy of product, pricing, and promotion in order to cause a beneficial exchange with the targeted market.” Marketing mix has four marketing strategies in making decision, that is: marketing decision, promotion decision, distribution decision, and price decision. In implementing certain strategy, the manager usually takes account, such as: (1) service products, ideas, or products created in order to meet the needs of the customers. In this case, the product being offered to the customers is Christian T-shirt. (2) Price determination is a balancing act so that the price given meets the expectation of the customers. In this study, the price offered is based on the calculation of the business owner as well as considering the needs of the customers. (3) Promotion is a mean or a way in sharing the information regarding the product to the customers. In this case, the act of promoting the T-shirt is held through making use of social media. (4) Distribution or placing is an outlet as a transaction place in which the seller and the customer meet. In this study, social media of Instagram and LINE@ become the place for transaction of the product. Definition of Product Tohar (2000) in his book entitled “Membuka Usaha Kecil” defined a product as everything or a concrete object sold to the market for usage, ownership, consumption, in order to satisfy the wants or needs. A product is a concrete observable and touchable object meaning that everything going through the process of production is a concrete object. A product is a real object, as well, so that there are various types of objects in life. In general, products are divided into two, consumer products and industrial products. (a) A consumer product is the last result consumed by the end-users or the households without any business or reselling purposes. The examples of consumer products are daily necessities, shopping goods (in which comparison regarding quality, price, and model are needed when buying), and specific goods (having their own unique qualities). (b) An industrial product is a good that is used in a process for the purpose of marketing development program. The examples of industrial products are raw materials, factory spare parts, operational supplies (daily products used by the sector of industry). The Importance of Price

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From the book “Business” written by Griffin & Ebert (2006), it is stated that price is a strategy in order to determine the income of a business; hence, price fixing is an essential element. There are three choices in terms of pricing: (1) Premium pricing is a way of establishing a price higher than the market. The justification usually stated is that high price equals better quality. (2) Penetration pricing is a way of entering the market by establishing price lower than the market. A thing to maintain while using such pricing is quality. (3) Economy pricing is a way of determining a price relatively close to the market. The Importance of Marketing in Products Promotion Cannon et al. (2008) in his book entitled “Basic Marketing” stated that every aspect in daily life is an impact of marketing, for instance a place to buy a certain product, what type of product to consume, or television programs to watch. Marketing is a strategy used by organizations in order to focus on certain goods needed by customers so that the customers are able to satisfy their needs. Once the customers meet their needs, marketing process becomes easier. Marketing offers an appealing and promising career opportunity, too. Marketing process plays an important role on the success of a company. Distribution/Product Placement (1) Distribution by Social Media of Instagram: A way of promoting products, besides using printed media or television, online media also can be used. Online media becomes the channel of product distribution. Due to its integrated system as well as its global range, people tend to use online media, such as Instagram. Instagram provides such enticing services and functions towards its users. Instagram makes it more expressive in sharing news or information since it uses pictures, photos, or short-length video. Services that given by Instagram are free that makes it is easy to access and attract a large number of people to download the application and sign up. The large number of users becomes the highlight for advertisement and promotion and gain benefits from its users. (2) Promotion using the Social Media of LINE@: The new service held by LINE called LINE@ is a specific application for business owners. LINE@ facilitates business owners to manage, to communicate, and to promote their businesses and it becomes a means of product distribution. The features provided in the social media of LINE@ help the owners of online shops as it not only promotes the products, but also helps the owners in managing their online shops, for example the application is accessible for more than one administrators, so that having multiple account to communicate with a number of customers at the same time is unnecessary. LINE@ also has the broadcast message feature to help owners in reaching out their many customers without having to spend much time, but at the same time it helps to gain the selling of the product. Those features provided by LINE@ attract online shop owners in order to promote their products as well as to get more sales. Purchasing Decision The Role of Purchasing Making a decision in purchasing has five factors in influencing the customers, those factors are: (a) Initiator: A person who gives an advice to purchase the product or the service. (b) Influencer: A person whose point of view or advices to influence other people in making purchasing decision. (c) Decider: A person who determines the decision of other people in purchasing the product. (d) Buyer: A person who directly purchases the product. (e) User: A person who directly uses the purchased product or service. Buyer Decision Process A consumer, before deciding to purchase a product, has to pass through the process so-called buyer decision process. Such process consisting of five steps explains on how a consumer

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determines his/her purchasing decision and the impact after purchasing. Those processes are: (a) Problem/Need Recognition: A consumer recognizes what the problem or need is and identify the product or type of product to purchase. (b) Information Search: The consumer finds out the product which would satisfy the recognized need. (c) Evaluation of Alternatives: The consumer evaluates the information about the products. The search reveals multiple products for the consumer to evaluate and understand which product would be appropriate. (d) Purchasing Decision: The consumer forms a list of preference of the products to make decision on which to purchase. (e) Post Purchase Behavior: This stage determines whether the consumer would like to repurchase the product. RESEARCH METHODS This research is the quantitative. Martono (2011) in Sutanto (2014) explained that quantitative research is conducted by collecting numerical data to be processed, and to be analyzed in order to obtain scientific information. This study employed the customers of Walking Revival, who purchased the products online via Instagram and LINE@, as the subject of the study. The population of the customers of Walking Revival were 120 customers. The amount of sample—a part of population to be analyzed, for this study was taken using sample calculation of Slavin formula (Sevilla et al., 2007 in Sutanto; 2014) and the number of the sample for this study is actually 54.5, so the researcher rounded the figure to become 55 respondents. The method employed in the study was Double Linear Regression with several tests: (1) Validity test in order to find out and measure the validity of a questionnaire. Such test observed the indicator of Pearson correlation coefficient with the total indicator of a variable. The significance level used was α=5% or 0,05 for the measurement to be considered valid. (2) Reliability test in order to find out whether or not the indicator questions are reliable. The formula used for the test is Alpha Cronbach. A variable is considered reliable if the value of alpha cronbach > 0.6. (3) Double linear regression analysis was used in order to test the relation between more than one free variable (Martono; 2011 in Sutanto; 2014) with the purpose of examining the subordination of dependent variable with at least two independent variables in order to estimate or predict the average of the population or the values of dependent variable based on the recognized independent variables. Double linear regression analysis was taken in order to find out both simultaneously and partially the impact of the material of the product (X1), price (X2), promotion (X3), and place (X4) towards the purchase decision (Y) of the customers of Walking Revival. (4) Hypothesis test consists of: (a) F test in order to determine whether the free variable gives a significant impact towards the fixed variable simultaneously. (b) T statistic test in order to determine the impact of an individual independent variable in order to explain the varied dependent variable. T test was done by distributing the value of t significance with the significance level of 0.05. (c) The determination coefficient (denoted R2) was used in order to measure the ability of the model in explaining every bound variable. (Ghozali; 2009 in Sutanto; 2014). The value of determination coefficient is within 0 to 1. (5) Classical assumption test was held in order to find out that double linear regression is capable to become a well-measured tool. Double linear regression model ought to meet the BLUE (Best Linear Unbiased Estimator) criteria (Kuncoro 2013). RESULTS AND DISCUSSION Some critics said that products of Walking Revival should vary the collection so that the product offered to the consumers is not only T-shirts. It prevents the consumers from the boredom of the homogeneity of the product. Some examples of products are bracelets, necklaces, pins, or other accessories under the Christian theme. Besides, Walking Revival never checked the products before the distribution, it is necessary for the company to do the checking as consumers pay a good attention of the product quality. Previously, the price of the product was the same,

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Walking Revival ought to make considerations before making fixed price. Another point is that the discount used to be given towards unsold product, so Walking Revival ought to give the discount towards the entire products so that the customers are able to get the discount in all products. The price is considered expensive, so in order to attract more customers, it is necessary to lower the price during the launching so that the customers will rethink to purchase the product after the launching. Walking Revival ought to have scheduled-promotion in order to gain the attention of the social media users. Previously, the type of promotion held by Walking Revival is only by giving discount; however it is necessary to create a more unique medium, namely a video which motivate not only the customers but also other people to become more religious or a video of an inspiring figure, etc. The use of social media of Instagram which previously was only due to the large number of users, Walking Revival now has to focus on using the platform as a means of promotion and interacting with the customers in order to optimize the work force and minimize the use of times. The features provided by the social media of Instagram and LINE@ ought to be maximized in terms of usage as a means of distributing the products since both platforms attract many customers. By optimizing the features available on the platforms, Walking Revival is able to serve its customers more professionally. It is important to pay attention to the use of Instagram as a promotion medium in attracting consumers and the use of LINE@ as a communication medium in order to facilitate the interaction with the customers. CONCLUSION Based on the analysis on marketing mix towards the purchasing decision of Walking Revival’s product, it can be concluded that: (1) Product leverages towards the decision in purchasing the product of Walking Revival. The important keys of the product are quality and design. (2) Price makes an impact in making purchasing decision of the product of Walking Revival. It is not only about low-price, but also the quality. (3) Promotion leverages towards the customers in buying the product of Walking Revival. To promote the product is essential; however, the type of promotion involving the customers emotionally, namely sharing the picture of spiritual activities in which the participants wear the product of Walking Revival is more essential. (4) Product placement/distribution gives an impact in purchasing decision of Walking Revival’s product and nowadays one of the most effective places in order to have a transaction is by using online platforms. Instagram plays the role of a platform to promote the product as well as to attract the attention of the customers. Meanwhile, LINE@ plays the role of a platform to communicate and a process of making purchasing decision of the customers. LINE@ is also considered effective as a platform to facilitate the post purchase behavior.

REFERENCES Andreti, J., Zhafira, N. H., Akmal, S. S., & Kumar, S. (2013). The Analysis of Product, Price, Place, Promotion and Service Quality on Customers’ Buying Decision of Convenience Store: A Survey of Young Adult in Bekasi, West Java, Indonesia, 2(6), 72-78. Retrieved from ISSN: 2278-3369 Cannon, J. P., Perreault, W. D., & Jerome McCarthy, J. E. (2008). Pemasaran Dasar (16th ed.). Cateora, P. R., & Graham, J. L. (n.d.). PEMASARAN INTERNASIONAL (13th ed.). Salemba Empat. Data Statistik Pengguna Internet Indonesia Tahun 2016 Pembicara Internet Marketing SEO | Konsultan | Pakar. (n.d.). Retrieved from http://isparmo.web.id/2016/11/21/datastatistik-pengguna-internet-indonesia-2016/

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Data Warehouse | Kementerian Agama RI. (n.d.). Retrieved from http://data.kemenag.go.id/# Dianawati, A. (2007). 6 Rahasia Menjadi Jutawan Internet. Jakarta Selatan: Mediakita. Ghoni, N. F. (2016). gara gara media sosial (UNEDITED): #garagaramedsos. Griffin, R. W., & Ebert, R. J. (2006). BISNIS (8th ed.). Hadiyati, E. (2016). Study Of Marketing Mix And AIDA Model To Purchasing On Line Product In Indonesia, 4, 49-62. Retrieved from ISSN 2053-4043(Print), ISSN 20534051(Online) Hasan, M. I. (2004). Pokok-Pokok Materi Teori Pengambilan Keputusan. Bogor Selatan: Penerbit Ghalia Indonesia. Herdinata, C. (n.d.). Interpretasi Regresi Berganda. Materi Universitas Ciputra. Surabaya: tidak diterbitkan. Kushwaha, G. S., & Agrawal, S. R. (2015). An Indian customer surrounding 7P‫׳‬s of service marketing. Journal of Retailing and Consumer Services, 22, 85-95. doi:10.1016/j.jretconser.2014.10.006 LINE@, Media Baru Bagi Para Online Shop dan UKM untuk Mengembangkan Bisnis | Startupbisnis.com. (n.d.). Retrieved from https://startupbisnis.com/line-media-barubagi-para-online-shop-dan-ukm-untuk-mengembangkan-bisnis/ Masrita. (2013). Pengaruh Bauran Pemasaran Terhadap Keputusan Pembelian Batik Jambi (Suatu Studi Di Show Room Dekranasda Provinsi Jambi) (The Influece of Marketingmix on Purchasing Decision Making Studi on Dekranasda Showroom of Jambi Province), 1. Nilai Pasar Industri Tekstil dan Fashion Diestimasi Rp 208 Triliun - Dunia IndustriDunia Industri. (n.d.). Retrieved from http://duniaindustri.com/nilai-pasar-industri-tekstil-danfashion-diestimasi-rp-208-triliun/ Pengertian Dan Tujuan Promosi Menurut Ahli - Pengertian-Pengertian Dan Info. (n.d.). Retrieved from http://pengertian-pengertian-info.blogspot.co.id/2015/09/pengertiandan-tujuan-promosi-menurut.html Pengertian, Klasifikasi dan Tingkatan Produk | KajianPustaka.com. (n.d.). Retrieved from http://www.kajianpustaka.com/2013/09/pengertian-klasifikasi-dan-tingkatan.html Prasetyo, B., & Jannah, L. M. (2011). Metode Penelitian Kuantitatif. Rangkuti, F. (2009). Strategi Promosoi yang Kreatif dan Analisis Kasus Integrated Marketing Communication. Jakarta: Pt. Gramedia Pustaka Utama. Setiawati, I., & Mashuri, A. A. (n.d.). PERAN MEDIA SOSIAL SEBAGAI UPAYA PEMASARAN BISNIS ONLINE (STUDI DESKRIPTIF KUALITATIF). Simamora, B. (2008). Panduan Riset Perilaku Konsumen. Jakarta: PT. Gramedia Pustaka Utama. Soegoto, Eddy S,Entrepreneurship: menjadi Pebisnis Ulung Sutanto, S. M., & Wardaya, M. (2014). USING SOCIAL MEDIA AS A MEANS TO PROMOTE NOVEL, book one (274). The Third International Conference on Entrepreneurship Tohar, M. (2000). Membuka Usaha Kecil. Yogyakarta: Kanisius. Widagdo, H. (2011). Analisis Pengaruh Kualitas Layanan Dan Promosi Terhadap Keputusan Konsumen Membeli Komputer Pada PT. XYZ Palembang. Forum Bisnis dan Kewirausahaan. Jurnal Ilmiah STIE MDP. Vol. 1, No. 1, pp. 1-10 Zimmerer, T. W., Scarborough, N. M., & Wilson, D. (n.d.). Kewirausahaan dan Manajemen Usaha Kecil (5th ed.). Penerbit Salemba Empat.

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BUSINESS DEVELOPMENT OF COMMUNICATION EDUCATION INSTITUTION OF SURABAYA, EAST JAVA Puput Tri Kusminto, 2J E Sutanto♠

1

Ciputra University Surabaya INDONESIA Email: [email protected] ABSTRACT This study is aimed at finding out feasibility aspects of the business development of communication education institutions in Surabaya, East Java. The present study discusses 5 aspects of feasibility study, they are legal aspects, environmental aspects, market aspects, management aspects and financial aspects. For data analysis technique, this study employed Five Force Models of Competition analysis, SWOT analysis, Marketing Mix (4P), Payback Period (PP) analysis, Net Present Value (NPV), Internal Rate of Return (IRR), Profitability Index (PI) , And scenario analysis. Based on legal, environmental, market and management aspects it is declared eligible to be developed. With regard the financial analysis, the total investment required was Rp 371,700,000.00. In the pessimistic scenario analysis, the results obtained PP for 3 years 1 month, NPV of Rp 320.121.208,00, IRR of 17% and PI valued 1.9. In moderate scenario analysis, the result of 2 years, NPV of Rp 955.282.173,00, IRR of 49% and PI valued at 4.3. In optimistic scenario analysis, 1 year 7 months, NPV of Rp 1,475,351,583,00, IRR of 70% and PI of 6.4. Based on the feasibility assessment on the financial aspect, this business is considered to be feasible to develop in all three scenarios. Therefore, based on the aforementioned aspects in this study, this business is deemed to be feasible develop. Keywords : business development, feasibility study, communication education, investment

INTRODUCTION Every people must understand their personality before creating a communication to achieve the desired personality, in this case, we are expected to become a figure who are ready to be publicly launched. However, this is not something which is impossible, this is in accordance with the thought of Andrew McCarty, Ph.D in his book entitled “positive thinking” (2007), suggesting that positive thinking and giving the highest appreciation to ourselves is something very basic to increase personality. Every people must feel lack of confidence to deliver a speech in public. Consequently, one perception emerges that to be a public speaker must have a basic skill or soft-skill. This unconfident feeling is affected by the lack of material mastery that will be delivered, status, appearance or intelligence of the interlocutors (audiences). Directly, this may cause depression

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or nervousness. Thus, a skill or soft-skill is required in each individual as well as their potentials are just necessarily to be displayed. In accordance with a study conducted by Anwar (2012), it is stated that around 85% of us are in unpleasant nervousness related with ability of speaking in public. For 15% up to 20% of college students particularly in Surabaya, this fear may weaken and disturb individual performance. Almost every people feels anxiety to show up in public, whether in the form of class presentation, business presentation, or in case of performing an act in theater or drama, even many brave people are still haunted by anxiety while communicating in public. The communication institutions serving as research for business development of PR Institute is Kiddos Learning Center which concentrates on public speaking class situated in Puri Surya Jaya Sidoarjo. Kiddos Learning Center is a communications institution. The owner establishes this communication institution because a lot of children facing difficulty to talk, in addition many parents who have difficulty in establishing communication with their children. This contribution of this institution to the world of children's communication education is highly significant. It also provides self-development and ethics training to its students. In addition, Kiddos Learning Center class is divided into 3 classes of stages of Kiddos, as early knowledge for your baby who wants to learn basic public speaking techniques from early age at kindergarten school age, Kiddos can be the right choice as a school supplies public speaking surabaya for Your sons and daughters with age between 4-6 years; Kids to enrich the knowledge of teenagers in the field of profession related to public speaking which is given for 7 - 12 years old, Teens class is aimed to mature the ability to speak students professionally with the age of 13-17 years. LITERATURE RIVIEW Basic Theory of Business Feasibility Study A business feasibility study was conducted. According to Jumingan (2014:3) business feasibility study is a study of whether a project can be implemented successfully. While Sakka & Yuzak (2013:1) explained that business feasibility study is a study involving various aspects, whether market and marketing aspects, technical and technological aspects, financial aspects, social and cultural economic aspects, juridical (legal) aspects, Management, all of which can be used to make a decision whether a business is worth doing or not. Legal Aspects Rumokoy & Maramis (2014: 3) states that law is any rule that can be legally forced by an authorized institution. In this case, the legal aspects include type of business entity and the business license arrangement. Services The company does not only cover sale of tangible physical products and can be perceived in terms of its benefits, but also sells products that are not real with benefits which can be perceived in the form of telecommunication services, aviation services, banking services and so forth. Experts define services as defined by Fandy Tjiptono (2012: 17) that services are an activity, benefits, or satisfaction offered for sale. SWOT analysis Armstrong & Kotler (2013: 82) explains that SWOT analysis is an analysis conducted to observe external and internal marketing environment. Strengths include internal capabilities, corporate resources, and positive situational factors that can help a company to serve its customers and achieve company goals. Weaknesses include internal limitations and negative situational factors which may affect a company's performance. Opportunities (opportunities) is a good factor and trends existing outside the environment that can be utilized by the company.

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Challenges (threads) are unfavorable external factors that may present and affect the performance of the company. Market and Marketing Aspects According to Sunyoto (2014: 37) market illustrates buyers and sellers are all involved in actual or potential transactions of goods or services offered. While marketing is a social and managerial process that makes individuals and groups obtain what they need and want through the creation and exchange of mutual products and value with others (Fahmi, 2014: 117). Marketing strategy According to Bygrave in the journal Mayhan Prathama (2014: 17) defines marketing strategy as a set of instructions and policies that are used effectively to match marketing programs with target market opportunities to achieve business goals. Simply, a marketing strategy basically shows how a marketing goal can be achieved. Meanwhile, according to Kotler & Armstrong (2010: 216) marketing strategy is an efficient strategy that serves to assist companies in providing value to customers and build customer loyalty relationship. Based on the above opinion, it can be said that marketing strategy is a collection of policies that can be a market segmentation strategy, choosing the right target market, and developing supply value positioning. Aspects of Management and Human Resources Aspects of management learns anything related to management plans and business implementation that will run (Rangkuti, 2012: 5). Management plays an important role in a business, but they must also be supported by a good workforce by which a business can run in accordance with the system built, so that the control of business can be more efficient and easy to run Organizational structure According Kasmir and Jakfar (2012: 174) organization is a system of activities that coordinate from a group of people who work together to achieve goals under the leadership of leadership. The organizational structure describes the formal roles, procedures, monitoring mechanisms. Authority, and the process of collecting policies. The purpose of the organizational structure is that the work can be completed better with the division of tasks and jobs. Financial aspect The financial aspect is an aspect used to assess the company's overall finance. From this aspect it is illustrated clearly any issue related to corporate profits, so it is one of the most important aspects to examine feasibility (Kasmir and Jakfar, 2012: 85). Those included into financial aspects are type of business costs, type of business capital, cash flow. Investment Feasibility Analysis There are several methods that can be used in analyzing and assessing investment feasibility. According Sunyoto (2014: 15) there are several methods that can be used as follows: 1. Break Event Point (BEP) 2. Payback Period (PP) 3. Net Present Value (NPV) 4. Internal Rate of Return (IRR) For the data analysis in this research, the methods used are PP, NPV, IRR, and PI. So the method to be explained in the present study is only about the analysis of PP, NPV, IRR, and PI Risk Analysis

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According to Rangkuti (2012: 12), risk analysis is conducted to determine the possibility that will occur to the results of the analysis of a business project. In this research the risk analysis used is scenario analysis. Scenario analysis is a risk analysis technique in which the best case and worst case outcome assessment is compared for one type of business performed. The scenarios used are divided into three possibilities, namely pessimistic scenarios, moderate scenarios, and optimistic scenarios. RESEARCH METHODS The research approach used in this research is applied research. Applied research deals with applications and theories to solve problems. Silalahi (2011: 23) explains that applied research is an investigation of one particular problem to find solutions that can be implemented for problem solving or to help make a good decision. There are three examples of applied research, namely evaluation research, research and development, as well as action research. The present study uses the type of research and development. Research and development is one aimed at developing a product so that the product has a higher quality (Kuncoro, 2013: 7). This research is expected to be a research material to analyze and develop business communication institution more broadly. RESULTS AND DISCUSSION Law The establishment of a business entity can be easily maintained without using a 3rd party. In this case the communications agency only take care once business entity even later will open branch in other city. In this case, the management of this business entity is very easy and does not require large funds as well as does not burden the business owner. Environmental Aspects Site selection becomes a consideration in the business development process, in this case if the place or the environment used is inadequate then profit sharing can be done with other parties who have the environment and strategic place. In its development, kiddos learning center directly comes to the place where communication classes were held both at school and in which the event organizer holds the event in groups. This is done with an aim to deal with a place that is considered far and inadequate by the service user. Services At the beginning, this institution only offers classes of teaching and learning activities in place but over time the institute also provides services to fill training and workshop activities. This is to provide choice to prospective users of services to use the services of these communication institutions do not only come to the classroom but also can invite practitioners from existing communication institutions. SWOT Some weaknesses hindering the development of this business are: 1. The location of communication institutions entering into housing, so that only certain parties can reach. This can be tricked by providing private classes to both personal and group service users so as to facilitate the process of teaching and learning, but it can also be a way of profit sharing with other parties who have a strategic location and position so that it can be reached by users of The institutional services.

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2. Teachers are hard to obtained due to the provided standard specified. This can be overcome by providing regular training so that the required human resources can be ready to use and have a positive contribution to the relevant institutions. 3. Lack of technology used. This can be overcome by budgeting funds to add equipment to support teaching and learning activities. Market Aspects Market segmentation was initially devoted only to children aged 4-17 years but in the future this institution will concentrate also for professional class which has an age range above 17 years. This is due to the demand and a good market share to be directed to the communication institution as a student. In addition, the market position not only as a provider of tutoring and teaching services but also as a communication consultant who can provide input for companies or other institutions that have public communication problems. Promotion is made by this institution not only through presentation and brochure, but also holding free trial class to prospective students but also also can make cooperation relation with internal party of school to be able to lead their students to this institution and by giving percentage to that party. Other things can also be done is that by holding a free seminar which can attract students in the free seminar activities about the functions and benefits of communication in the current era. Management Aspects This aspect of management has been determined to have their own roles and functions. But in its development, every division can make marketing freely to further optimize the results. For example, a teacher can also be appointed to give a presentation materials in front of prospective students or otherwise marketing is also equipped with the ability to teach to provide efficiency in the organization.. Financial aspect To save the financial flow, it can be done by paying employees under the UMR (minimum allowance standard) for administrative and marketing personnel who have been trained, then every 3 months evaluation and revamping can always be conducted again. In addition, a contract is also conducted which in it explain that if a resign is decided then it must be informed 1 month earlier. To save the financing of human resources, they are recruited from SMK graduates. On the other hand, there is also an additional percentage cost given if the marketing is able to deal with related clients regarding the cooperation of the use of the service. Conclusion After conducting research and analysis on some aspects about business development of communication institute in Surabaya, East Java, hence we can draw some conclusion as follows: 1. Based on the analysis on the legal aspect, the established business will be in the form of cv or foundation, while the procedure for obtaining business license to establish communication education institution can be done legally. Thus, in the aspect of business, law is considered feasible to be developed. 2. Based on the analysis results of the business environment and industry structure, SWOT analysis of the strengths, weaknesses, opportunities, and threats is obtained by the company. In the SWOT analysis results, the result obtained was that the company is located in the first quadrant room A (first), namely growth quadrant with rapid growth strategy (fast growth strategy). Thus, on the aspect of the business environment, it is considered feasible to be developed. 3. Based on the analysis on the market aspect it shows that as many as 32.8% of students experiences moderate anxiety, 48.3% of students experiences high anxiety and 12.1% of

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students experience svery high anxiety in public speaking situations (Suwandi, 2013). The company has the potential for market development. 4. Based on the analysis of aspects of management and human resources, the organizational structure used is a simple organizational structure and self-managed by the owner who directly supervises their own employees. In this aspect the business is considered feasible. 5. Based on the financial aspects, the analysis uses Payback Period (PP) indicators, Net Present Value (NPV), Internal Rate of Return (IRR), Profitability Index (PI), and pessimistic, moderate, and optimistic scenario analysis, based on the results of the analysis , they show the results of the calculation of PP, NPV, IRR, and PI feasible on the three scenario analysis. Thus, the financial aspect of the business is considered feasible. 6. Based on all aspects that have been analyzed, the business is considered feasible to be developed.. REFERENCE Fahmi,Irham. (2014) Studi kelayakan bisnis dan Keputusan Investasi. Jakarta: Penerbit Mitra Wacana Media Jumingan. (2014) Studi kelayakan Bisnis Teori & Pembuatan Proposal Kelayakan. Jakarta: PT Bumi Aksara Kasmir & Jakfar. (2012) Studi Kelayakan Bisnis Edisi Revisi. Jakarta: Kencana Prenada Media. Kotler, P & Amstrong, G. (2013) Principle of Marketing. Upper Saddle River: Pearson Kuncoro. (2013) Mudah Memahami dan menganalisis Indikator ekonomi. Yogyakarta : UPP STIM YKPN. Rangkuti, Freedy. (2013) Teknik Membedah Kasus Bisnis Analisis SWOT Edisi Revisi. Jakarta: PT Gramedia Pustaka Utama Rumongkoy, D.A & Maramis, F. (2014) Pengantar Ilmu Hukum. Jakarta: PT Raja Grafindo Persada. Sakka, A. & Yuzak, E. (2013) Contoh-contoh Kasus Studi Kelayakan Bisnis. Jakarta: Penerbit Mitra Wacana Media. Silalahi, U. (2011) Metode Penelitian Sosial. Bandung : PT. Reffika Aditama Suliyanto. (2010) Studi Kelayakan Bisnis : Pendekatan Praktis. Yogyakarta : Penerbit ANDI Tjiptono, F. (2012) Pemasaran Strategik. Yogyakarta : Penerbit ANDI

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ANALYSIS OF PRICE DETERMINING STRATEGY AT PRIMA SKIN CLINIC SEMARANG Tjoeng Lenni Indriani, 2Tina Melinda♠

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Ciputra University Surabaya INDONESIA Email: [email protected], [email protected]

ABSTRACT This study investigated pricing strategies in beauty clinics. The purpose of this study was to analyze pricing strategies in beauty clinics as to achieve price-oriented covering profits, volumes, images and price stabilization. This study employed a qualitative method with descriptive design. Data were gathered using interviews, and the research samples were PRIMA Skin Clinic patients. Beauty Clinics had a function as a place to conduct consultation and skin care under doctor's supervision. Problems faced by women were different from humanitarian, life-altering, or hormonal. The increased of technology advancement affected the needs of scientists to deal with the health and equilibrium of the faces. PRIMA Skin Clinic provided a premium skin care with a range of coverage. The extent to which the PRIMA Skin Clinic sought the market target was a medium-sized market. It was a sensitive factor. A pricing strategy was used for the investigation of the classical investigation in the framework, including the three fold price values: the price for new products, the prices for competing products, and the market-based prices. The making the pricing strategies for each product were analyzed on the basis of the prevailing strategies in the country. Keywords: Beauty Clinics, Pricing Strategies, Market Sensitive, Framework, Situational INTRODUCTION The development of technology and living standard improvement of Indonesian people, especially the citizens of Semarang city, go hand in hand with the demands for good appearance. The needs for aesthetics and skin beauty has become increasingly in demand. While their lifestyles have been changing, this has affected women’s view on the importance of health and facial skin aesthetics. PRIMA Skin Clinic is a beauty clinic, known with the slogan "Cantik Tidak Harus Mahal (to be beautiful should not cost much)", that offers premium facial treatment at an affordable price. All of this skin clinic’s treatment activities, products and creams are under the supervision of a physician, registered with BPOM. The target market of PRIMA Skin Clinic is the lower middle market dominated by housewives, civil servants, private employees, and high school students. Regarding middle to lower class market, a price is a sensitive factor. With the widespread of other clinics in Semarang, PRIMA Skin Clinic is challenged to maintain its competitive advantage especially in terms of affordable prices. For that reason, this clinic concerns the slogan "Cantik Tidak Harus Mahal (to be beautiful should not cost much)".

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LITERATURE REVIEW Previous Studies Previous studies examined pricing strategies. These studies led to relationships between value of customer satisfaction, competitors, and cost information. The results indicated both a pricing strategy and pricing strategy had been applied. However, companies did not pursue an achievement of a strategy as indicated by a price theory. Some did not even use any pricing strategies; meanwhile, others felt inadequate to fulfill the minimal requirements of the existing strategy choices. This present study aims to know the relationships of price strategy with price determination through consumers’ satisfaction value method, competitor, and cost information. Pricing Strategy Model The situation of fiscal determination dictated changes in external conditions, competitive action and opportunities to reduce competition through a price. The price varied in the markets and functioned as a signal for the buyer, a competitive instrument, a goal for increasing the performance of a substitute and substitution for the functions of other marketing programs. Pricing had a very important role in marketing exchange. In a marketing exchange, the price to be paid by the consumers had to be greater in comparison with the price sold by the marketer. Analysts from the assessment of price determination were the best estimates about market's appreciation of prices, product determination, competitive analysis and evaluation of legal and institutional barriers. A pricing strategy meant that firms were able to achieve price objectivity in a market; whereas, pricing was a set of activities executed by an organization's manager leading to price decisions. Conceptually, pricing strategies are developed by Noble and Gruca. The design of this framework includes three types of pricing situations; Price for New Product Pricing, Competitive Pricing, and Product-line Pricing. RESEARCH METHODS This study was qualitative using a descriptive design. A qualitative method, according to Sugiyono (2012), was an interpretive method because the data concerned the interpretation of the data in the field. A qualitative method, according to Moleong (2013), was a study that produced descriptive data in the form of written words. This approach covered the background and the individuals entirely. This case did not isolate an organization or individual into the variable or hypothesis; however, they were seen as a single entity (holistic). This study employed judgment sampling: purposive sample selection selected using certain considerations, generally tailored to the purpose or problem of research (Indriantoro & Supomo, 2011). The selected population was limited to elements that provided necessary information. Sugiyono (2012) said a research with a qualitative method was not based on statistical calculation but the selected sample in order to obtain maximum information. The key informants in the study consisted of patients (potential patients, transferred patients, and old patients), experiments, and benchmarks against competitors. DISCUSSION New Product Price Pricing Strategy - Price Skimming A price skimming strategy was a higher pricing strategy for a new product the customers were willing to pay a high price. Companies produced less but got more profitable sales. The price skimming was usually applied to a market willing to pay more for the latest technology. Lack of interest and purchasing power of PRIMA Skin Clinic patients on facial skin care was due to the lack of using the latest technology. Regarding the use of new technology, PRIMA Skin Clinic

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viewed the technological based treatment still unfamiliar. Moreover, education skin health treatment for patients took time, not to mention the methods to attract patients on the treatment. The wide variety of treatments as well as the competition of beauty care machinery manufacturers resulted in a wide selection of high-tech machines from different manufacturers with different treatment procedures although not all of these features may be required by the patients. The careful selection for the tools was certainly in need to anticipate unexpected results. Price Skimming Before Research After Research Applying Price Skimming was less The clinic should maintain its vision by suitable with clinical vision that provided providing affordable care, and upgrading affordable care. technological based treatment. It needed to apply a careful selection of machines produced by Asian countries, compared to Europe. Their features should be at least similar in order to suppress the price per a treatment session. New Product Price Pricing Strategy - Penetration Pricing Penetration pricing was a low price for new products aiming to attract more buyers and a larger market share. The followings were worth considering. First, the market had to be very sensitive to the price. As a result, the low price setting would trigger a high market growth. Low prices were always a consumer interest. However, a low price could be a matter of doubt for the interest of prospective customers. Penetration Pricing Before Research After Research The offered price was in line with the Improving the service and product quality penetration pricing strategy: adjusting the was the necessity (safe and registered BPOM) purchasing power of the target market, so that the cheap prices made consumers not especially on the standard composition of hesitate to entrust PRIMA Skin Clinic‘s face care. the offered product. For the future, the clinic had to get HALAL certificate from MUI

New Product Price Pricing Strategy - Experience Curve Pricing This strategy stated cost of a service would decrease a two-fold increase in the experience of a business in producing and selling such products. At the end of the day, the consumers enjoyed their training with the more low-priced the company offered. These strategies found to be inadequate for lasers. These machines were still inadequate. The price offered by clinicians was very low to reach millions. It was because other competitors had these schemes. As technology began developing, laser machines were no longer luxurious instruments. Many manufacturers produced lasers with almost the same features with their certain periods. Thus, it was necessary to make alternatives of the machines with similar features. Experience Curve Pricing Before Research

After Research

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Experience Curve Pricing was applied to lasers. A laser machine used to be advanced before it was sold at a high price for a sophisticated price until a subscriber reaches millions of dollars

With more emerging more practical and new laser machines, the price offered for the engine unit could be more substantial to the impact of laser treatments

Pricing Strategies for Competitive Products - Leader Pricing Leader pricing was a pricing strategy that concerned selling a price with a very thin profit. As a result, the price was below the market price. The purpose of leader pricing was as a guide price so that consumers could buy more other items. Variations in terms of types and treatment expanded the scope of pricing with leader pricing strategy. Leader pricing could be applied to the basic treatment in every beauty clinic including facial treatment. Facial treatment was a facial cleansing and relaxation treatment done before other treatment. This was an optional but remained the choice for most patients. Leader Pricing Before Research After Research The pricing leader was applied to the The variety of leader pricing started with the clinic as the facial treatment. People had products patients were familiar with such as an equal ability compared to other cream treatment treatments.

Pricing Strategies for Competitive Products - Parity Pricing Parity pricing was related to the determination of the budget through which the costs were incurred by competitors. The price was determined on the basis of the price determined by the market leaders. The determination of the price was to consider the average price set by the market. For acne-prone skin types and alternative treatments were not known. Initially the price of the tape was about 100,000, enclosed by the acne and whitening. The type of tape was categorized into two: acne and whitewashing. The cost of a proportion was 90,000, adjusting the cost of the market to the concentration of the patient's needs. Parity Pricing Before Research After Research The price of ultrapeel/peeling ranged The price of ultrapeel/peeling declined to from Rp 100.000, - in the year of opening 90,000, -adjusting the price of other compositors.

Competitive Product Price Pricing Strategy - Low Price Supplier Low price suppliers would be applied if the company set the lowest price in the market. Regarding low price suppliers, companies managed to find suppliers that could supply inputs with cheap prices and then sold it to consumers with a cheap price compared to other companies. PRIMA Skin Clinic sold its products directly to the end user. As a result, the production of products were not in bulk, adapting the capacity of clinical needs

Before Research After Research This strategy was applied in non-service Looking for cheaper supplier packaging as to

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products to maintain the quality and suppress the prices of products sold image of the company.

Competitive Product Pricing Strategy - Premium Pricing The company set the highest price in the market, providing the highest quality. This was in contrast to demands from middle to low segment consumers. This strategy was to prioritize prices first, as stated in the price skimming strategy. The price skimming accompanied with technology raised the selling price. For premium pricing, the company always set the highest price offset by providing high quality. PRIMA Skin Clinic applied premium pricing when doing Meso CRT treatment. With a fairly high price per treatment of Rp 350,000, -, Meso CRT remained patients’ favorite, especially those aged 35 years and over. These people regarded aging as a serious problem. The price was relatively high compared to the competitor's clinic, ranging from Rp 150.000, - to Rp 200,000, -.

Before Research After Research Appling premium pricing in Meso CRT Maintaining the quality of meso CRT with treatment was not done by reducing the clear and precise education to patients quality and means of treatment with the medium needle (not with a roller) because it had good results and maximum

Product Line Pricing Strategy - Complementary Product Pricing Complementary product pricing was a pricing strategy where firms set core product with low price. By contrast, they set the price of supporting accessories with a higher price (premium). The pricing of accessories (such as serum, mask, etc.), in addition to standard treatment, was not a problem if the price was reasonable and affordable. The core products and accessories in the world of beauty clinics had their respective roles and tend to be needed on a continuous basis. Complementary Product Pricing Before Research After Research Has not yet implemented the strategy of Maintaining the price of accessories complementary product pricing because it (especially serum and masks) at a reasonable was cheap and affordable price

Product Price Pricing Strategy - Price Bundling The product package system was more effective for new patients who started to have care treatment with the complete products. The rest of the purchase tended to include all units because each product was not the same. It was more effective for older patients. The price bundling was applied to products that were more often purchased or prioritized by patients (such as morning creams and sunscreen running faster than night cream). The price bundling increased the patients’ interest to buy because it was cheaper and more needed. In addition to experts, the right price bundling made companies easier to build their brandings related to the special product packages the clinics had.

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Price Bundling Before Research After Research It had a delicate balance of chemical It prioritized the needs of patients/old patients products synergistic with a skin-cleansing for creams and other products which were less products synergistic in terms of product end time. Product Line Pricing Strategy - Customer Value Price Strategy The company assigned one version of its product that had a very competitive level. Some facilities were subtracted from their normal versions. From the patients’ point of view, the reduction of certain facilities could have effects on the treatment result: they became less effective and less satisfactory although they just paid less money. Some patients realized mask and serum (optional) facilities after facial treatment would be a necessity and had to be applied after facial treatment. If not, their faces turned into red and the pores got larger. For that reason, some patients needed to have a facial price including masks and serum. This treatment was supported by the experts: beauty clinic was a business that not only sold products but also services. The reduction of facilities just made consumers feel uncomfortable. If customer satisfaction was not achieved, the desire to re-purchase products and services in the clinic would be reduced. Moreover, they were likely to move to another clinic whose values were more positive. Customer Value Price Strategy Before Research After Research Prioritize patient satisfaction not by Maintain standardized products and service reducing the product services offered according to SOP as to prioritize patients’ comfort in doing treatment at clinic

CONCLUSION This thesis investigates pricing strategies in beauty clinic. This study aims to analyze pricing strategies in beauty clinics as to achieve price-oriented goals: profit, volume, and image and price stabilization. The beauty clinic is a clinic offering dermatology services or medical branches related to skin and skin-related parts such as hair, nails, etc. Here is the summary and evaluation of pricing strategies. NEW PRODUCT

COMPETTITIVE PRODUCT PRICING

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PRICE SKIMMING

Not appropriate for price sensitive markets (expensive clinical image) PENETRATION PRICING Strategies to attract patients to new products EXPERIENCE CURVE Selection of PRICING alternative machine units that gradually dropped the price LEADER PRICING Application of this strategy may affect

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PRICING STRATEGY

PRODUCT LINE

the clinical image PARITY PRICING Strategies can be used to stabilize prices against competitors LOW PRICE SUPPLIER Less precise (directly to end-user) PREMIUM PRICING Patient education and product/service selection are essential (meso CRT) COMPLEMENTARY The core and PRODUCT PRICING complementary products run synergistically, this strategy is less suitable (high price less desirable) PRICE BUNDLING The necessity of choosing the right product bundling  combination of services and products (cream) CUSTOMER VALUE Reduction of PRICE facilities can have a negative impact on the image (services)

The pricing becomes an appropriate strategy for new products at PRIMA Skin Clinic. Applying low pricing for new products has been successful at attracting more patients and larger market shares. This strategy is effective with market conditions where price becomes sensitive. Moreover, low pricing strategy creates high market growth and becomes a sensible strategy due to elastic consumers’ demands. For competitive products, parity pricing can be an appropriate strategy to obtain price stability in a particular treatment of competitors. The pricing is made equal to the average price set by the market. With this strategy, the needs of products and services can be adjusted to the price of competitors or market leaders. In a premium pricing strategy, understanding treatment with right priorities is worth doing. Nevertheless, this strategy cannot be applied in all products and services. After the application of premium pricing, education to patients should be immediately done. In so doing, patients do not get the impression the clinic is expensive, and thus they are reluctant to try the treatment again. This education is precisely done by doctors who professionally explain during the consultation session with the patient. For product-line, the price bundling is the company offering products combined with other products. This price bundling needs to be applied in the product line of cream and cleanser (cleanser). This product package is effective for new patients, not old patients. For old patients there is no package that suits the needs. In the future, the development of this price bundling strategy should focus on the needs of the old patients

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REFERENCES Alma, Buchari. (2013). Manajemen Pemasaran dan Pemasaran Jasa. Bandung: ALFABETA. Anggraeni, Suryadi dan Fitriani. (2014). Analisis Harga Pokok Produksi dalam Penetapan Harga Jual Konsentrat. Arikunto, Suharsimi. (2013). Prosedur Penelitian Suatu Pendekatan Praktik. Jakarta: Rineka Cipta. Hardinis. (2012). Strategi Penentuan dan Pengelolaan Harga. Jakarta: Universitas Mercu Buana. IndriantorodanSupomo.(2011).MetodologiPenelitianBisnisUntukAkuntansi dan Manajemen, EdisiPertama.Yogyakarta: BPFE. Ingenbleek, Lans. (2013). Relating Price Strategies and Price-setting Practices. Kotler, Philip dan Keller, Kevin Lane. (2012). Marketing Management, 14th Edition. New Jersey: Pearson Prentice Hall, Inc. Kotler, Philip dan Gary Armstrong. (2012). Prinsip-prinsip Pemasaran. Edisi 13. Jilid 1. Jakarta: Erlangga. Lowe, Yee, dan Yeow. (2014). Price Promotions and their Effect upon Reference Prices. Moleong, Lexy J.(2013). Metode Penelitian Kualitatif, Edisi Revisi. Bandung: PT. Remaja Rosdakarya. Oentoro, Deliyanti. (2012). Manajemen Pemasaran Modern. Yogyakarta: LakBang PRESSindo. Olbrich dan Jansen. (2014). Price-quality Relationship in Pricing Strategies for Private Labels. Salim dan Subagio.(2013). Analisa Pengaruh Retail Mix Terhadap Keputusan Pembelian Konsumen di Kampoeng Roti Nginden Surabaya, Jurnal Manajemen Pemasaran Petra , 2 (1), hal 1-10. Sugiyono. (2012). MetodePenelitianKuantitatifKualitatifdan R&B. Bandung: Alfabeta. Tjiptono, Fandy dan Chandra. (2012).Pemasaran Strategik. Yogyakarta: ANDI. Widyawati. (2013). Analisis Perhitungan Harga Pokok Produksi dan Penerapan Metode Mark Up dalam Penentuan Harga Jual Produk pada Usaha Amplang di Samarinda

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EVALUATION OF CUSTOMER SATISFACTION TOWARDS AMYLINEAR PRODUCT 1

Dian Juliantine, 2Tina Melinda♠ Ciputra University Surabaya INDONESIA

Email: [email protected], [email protected] ABSTRACT The high figure of obesity in Indonesia underlies the development potential of the healthcare business. EASECOX company has excellent products such as underwear clothing for health with the trademark Amylinear. In addition to help the user to gain the ideal body shape, Amylinear underwear can also improve the health condition of the wearer. The purpose of this study was to analyze customer satisfaction towards Amylinear products. Research with the title EVALUATION OF CUSTOMER SATISFACTION Towards AMYLINEAR PRODUCT, is using a qualitative approach through interviews with four informants, among others are: 1 user of the Amylinear product with duration of use more than one year and re-purchase, 2 users of the Amylinear product with duration of use more than one years and has been re-purchase who also become a re-seller or distributor of Amylinear products, 1 general practitioners . The data obtained will be applied to the theory of Customer Satisfaction, Quality of Products, Quality of Service, and Emotional Factor to analyze customer satisfaction towards Amylinear product. From these results we concluded that the goods are said to be good not only seen from the quality of its products, but also of the quality of service after the purchase, and how well and successful distributors gain emotional factors of their customers. Keywords: EASECOX, Amylinear, health clothing, underwear, corsets, customer satisfaction, product quality, service quality, emotional factor INTRODUCTION In Indonesia, obesity rates continue to rise. Based on Riskesdas (2013), in adult men increased from 13.9% in 2007 to 19.7% in 2013. While in adult women there is a very extreme increase reached 18.1%. From 14.8% in 2007 to 32.9% by 2013 (Riskesdas, 2013). The World Health Organization (WHO) has declared obesity as a global epidemic. Obesity has a multifactorial etiology that involves genetics, metabolism, culture, psychosocial factors and lifestyle changes resulting in increased food intake and reduced energy expenditure (Fontaine et al., 2003; Sebastian, 2012) resulting in an accumulation of excess body fat. Whether you realize it or not, more and more people are found to be overweight or obese. According to the Central Bureau of Statistics (BPS) in 2014, the number of fat men six times more than 10 years ago. While for women is 3.5 times compared with 2004. Based on basic health research (riskesdas) 2013, the increase in true obesity rates occur in men and women. The male obesity rate in 2010 is about 15 percent and is now 20 percent. In women, the percentage increase to 35 percent from 26 percent in 2010. In fact, this year the figure of obesity in women in East Java above the national figure of the percentage of 32.6 percent. Andriyanto explained, one indication to measure obesity is the circumference of waist. Normal waist circumference in males is 90 cm and women 80 cm. Riskesdas 2013 also mentions, the

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percentage of population of East Java (women and men) whose stomach circumference above the normal limit reached 27 percent. As long as the sick person wants to be healthy and the healthy person wants to stay in shape, the business prospect of health is bright. However, the health business players are already crowded. The risk, margins can be eroded if the price war. Service is the key to survival. For normal humans, health is the most important thing. Because it is considered as important, health business grows rapidly. Business consultant Henky Eko Sriyantono said business growth in the health sector ranged 50% every year. In fact, this business can increase up to 100% in a year. Amylinear is a woman's underwear with health advantages that can reduce the problem of obesity and can shape a woman's body becomes more ideal. Increasingly, women's underwear business for premium segment is increasingly exciting. Special segment of premium women's underwear, business growth reaches about 20% per year. This promising market prompted some foreign manufacturers and brands to seriously work on the Indonesian market. Amylinear is one of the superior products of the company Easecox. Easecox Company was established in Taiwan by Amylin since 1988. Easecox is one of the companies in Taiwan ready to enter the global market of International. The business model run by the company Easecox with Amylinear's flagship product is Multi Level Marketing (MLM). With this tiered system the product is not through the agent but from the company directly to its dsitributor so that there is a disconnection of the distribution chain. Seeing the conditions of competition so tight, the company continues to increase customer satisfaction; Such as providing product samples, periodic servicing to customers, and a familial approach. According to Irawan (2008: 37), the factors that drive customer satisfaction include product quality, price, service quality, emotional factor, cost and convenience. LITERATURE REVIEW Customer Satisfaction The definition of customer satisfaction by Kotler (2014: 150) is the feeling of pleasure or disappointment that comes after comparing the performance of the thought product to the expected performance (or outcome). According to (Robert W. Lucas, 2012) states that: Satisfaction is a big factor for many customers in remaining loyal. In your own organization, your effort could be a deciding factor in customer ratings for the quality of service rendered. According to Kotler and Keller (in Heruwasto & Aprilia 2012: 431) who became indicators in customer satisfaction are: 1. Customer satisfaction is judged by the appropriateness between service, price and product with what was expected by customers. 2. Re-buy 3. Recommending others Product Quality According to Kotler and Armstrong (2012: 283) the meaning of product quality is: the ability of a product to perform its functions, it includes the product’s overall durability, reliability, precision, ease of operation and repair, and other valued attributes. To achieve the desired product quality then required a standardization of quality. This way is intended to keep the resulting product meet the standards that have been set so that customers will not lose confidence in the product concerned. There are nine dimensions of product quality according to Kotler and Keller are converted by Bob Sabran (2011: 8) as follows: 1. Form, including the size, shape, or physical structure of the product. 2. Features, special features, characteristics, special services, advantages that are integrated into a product exposed to the customer / social / public.

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3.

Performance quality, is the level at which the main characteristics of the product operate. For example price, cleanliness and taste. 4. Perceived quality, customer perception of quality totality and brand superiority. 5. Durability, a measure of the operating life expectancy of a product under ordinary or stressful conditions, is a valuable attribute for certain products. 6. Reliability (reliability), is a measure of the probability that the product will not malfunction or fail within a certain time. 7. Repairability, is a measure of ease of product repair when the product is not working or fail. 8. Design, is the totality of features that connect the look, feel, and function of the product based on customer needs. Based on the above dimensions, it can be concluded that a quality dimension is a requirement for a value of product allows to be able to satisfy customers as expected. In this research will be discussed on Shape, Quality of product performance, Impression quality, Resilience, Reliability, and Design. Service Quality According Tjiptono (2011: 23) Service Quality is something perceived by the customer. Customers will assess the quality of a perceived service based on what they describe in their minds. Customers will switch to other service providers who are better able to understand customers' specific needs and provide better service. According to Parasuraman, Zeithaml, and Bery cited by Tjiptono (2011: 69) identify there are ten main factors that determine the quality of service. These ten factors are: 1. Reliability, includes two main things, namely the consistency of work (performance) and ability to be trusted (dependability). This means that the company concerned fulfills its promise, for example delivering its services on an agreed schedule. 2. Responsiveness, ie the willingness or readiness of employees to provide services required customers. 3. Competence means that everyone in a company has the skills and knowledge needed to provide a particular service. 4. Access, including ease of contact and encounter. This means the location of service facilities that are easy to reach, the waiting time is not too long, the channel communication company easily contacted, and others. 5. Courtesy, includes the courtesy, respect, attention and friendliness of contact person (such as receptionists, tellers, telephone operators, etc.). 6. Communication, which means providing customers with information in a language they can understand, and always listening to customer suggestions and complaints. 7. Credibility, which is honest and trustworthy. Credibility includes company name, company reputation, contact person characteristics, and customer interaction. 8. Security, which is safe from harm, risk, or doubt. These aspects include physical security, financial security, and confidentiality. 9. Understanding, an effort to understand customer needs. 10. Tangibles, the physical evidence of the services, may be physical facilities, equipment used, physical representations of services such as computer units used. In this research will be discussed on Responsiveness, Competence, Access, Courtesy, Communication, Credibility, Understanding, Tangibles.

Emotional Factor According to Khaled (2012) marketing based on experience is able to create customer loyalty through experiences that make customers impressed. Robinete and Brand (in Ratih, 2010: 124)

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divide the value into two parts: Rational Value (Product and Money) and Emotional Value (Equity, Experience, Energy). Rational Value describes the value customers receive on each product and service use and compares it to the value of money (rational), while Emotional Value describes the value customers receive in terms of equity, experience and energy. Understanding the hearts of customers means understanding their feelings and emotions and ultimately the company can provide values that are more emotional (Emotional Value) than the Rational Value. Factors influencing perceptions and customer expectations according to Gaspersz in (Nasution, 2010: 104) are as follows: 1. Needs and desires associated with things that customers feel when they are trying to make transactions with producers / suppliers of products (companies). If at that time the needs and desires are large, expectations or expectations of customers will be high, and vice versa. 2. Past experience when consuming products from companies and competitors. 3. The experience of friends, where they will tell the quality of products to be purchased by the customer. This clearly affects customers' perceptions especially on products that are perceived to be high risk. 4. Communication through advertising and marketing also affects customer perceptions. The people in the sales and advertising department should not make excessive campaigns beyond the level of customer expectations. In this research will be discussed about all four factors. RESEARCH METHODS This research uses research type with qualitative approach. According to Bogdan and Biklen (in Sugiyono, 2013: 13) states one of the characteristics of qualitative research is descriptive so that the data collected in the form of words or images so as not to emphasize the numbers. Moleong (2013: 16) states that qualitative research methods produce descriptive data in the form of written or oral words about the nature of an individual, the circumstances, the symptoms of a particular group that can be observed. Thus, in this study, product quality, service quality, and emotional factor are research data that can be described in terms of customer satisfaction evaluation of Amylinear products. After that, also described the results of interviews with informants. The descriptions of interview results are collaborated as research objects that are studied to answer the formulation of the previously proposed problem. Subjects and Research Objects Moleong (2013) describes the subject of the study as an informant, meaning that people in the background of research are used to provide information about the situation and condition of the research background. In this study the subject is: 1. Doctor 2. 2 distributors as well as users of Amylinear products 3. User According Sugiyono (2012: 38), understanding of the object of research is an attribute or the nature or value of people, objects or activities that have a certain variation set by researchers to learn and then drawn conclusions. In this research, the object of research is the quality of Amylinear product, service quality, and emotional factor. Validity and Reliability According Sugiyono (2011: 2), valid shows the degree of accuracy between the actual data occurs on objects with data that can be collected by researchers. Valid data means data that is not different between data reported by the researcher with actual data going on the object of research. According Sujarweni and Endrayanto (2012: 177) Test validity is used to determine the feasibility of the items in a list of questions in defining a variable. In this research, the

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researcher uses triangulation technique to test the truth of the data. Triangulation in a research is important if researchers really want accurate data. According Sugiyono (2011: 330), triangulation techniques are defined as data collection techniques that are combining from various data collection techniques and data sources that already exist. When data collection is done with triangulation, then actually collected data that simultaneously test the credibility of data, that is checking credibility of data with various technique of data collecting and various data source. According Sugiyono (2012: 273), Triangulation Source technique is done by examination of data obtained through various sources. Triangulation of sources will be made to users of Amylinear products with the use of more than 1 year and not repurchase, users of Amylinear products with the use of more than 1 year and repurchase, users of Amylinear products with duration of more than 1 year and have made purchases And became a seller or distributor of Amylinear products, and a doctor. In addition to be valid, the research instrument must also be reliable (consistent). Sugiyono (2011: 3), reliability with respect to degree of consistency data in a certain time interval. Reliability test in this research using dependability technique, carried out the search during the process by looking at the consistency of answers obtained from resource persons during the data collection process. Dependability technique is based on the assumption of repetition and replicability (Emzir, 2012: 80). The technique used is the technique of source triangulation by examining the data obtained through various sources.

RESULTS AND DISCUSSION Tjiptono (2004) in Surtiawan (2006) adds that customer satisfaction or dissatisfaction is a customer response to a perceived discrepancy / disconfirmation evaluation between the previous expectations (or other performance norms) and the actual performance of the perceived product by the user. Meanwhile, according to Kotler in the book Sunyoto (2013: 35), customer satisfaction is the level of one's feelings after comparing (performance or results) are perceived compared with expectations. From the results of the analysis of customer satisfaction, companies need to see the needs of customers. Can be seen from the age segment, where young customers are mostly more concerned with appearance. Therefore distributors should be able to show the results of physical changes and shapes of those who have used the Amylinear product first. And for the elderly customer most of the needs are for health and weight loss. If the customer is good, they will not hesitate to buy the product again and promote it to others. CONCLUSION In this study discussed about customer satisfaction Amylinear products. Customer satisfaction seen from three factors, namely product quality, service quality, and emotional factor. The purpose of this study is to analyze customer satisfaction of Amylinear products. From the research of product quality that has been done, it can be concluded that the goods are said good not only using good materials, but also through the process and research for many years. So that ultimately created a product that has a patent from Japan with the benefits of the product there is the content of tourmaline stone in yarn fiber so as to provide maximum results for the wearer and durable. So the quality of Amylinear products is unquestionable. Service quality factor, it can be concluded that service / service to customer both before and after transaction is equally important. Therefore, a good relationship and kinship to customers and prospects is important. And also the company through its distributors to educate customers about the awareness of health, product benefits, company history, product manufacturing

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process, etc., so that customers feel close and understand correctly about Amylinear products. Many of the customers are satisfied with this service, and re-buy the product and even recommend it to family, friends, relatives, and relationships. The company seeks to meet the needs of its customers by touching the emotional factors of customers. Customers will be interested to try and buy products by seeing the results of friends or people they know. The company also provides examples of products so that potential customers can try the product and see and feel directly the changes that occur in the body. To touch the emotions of its customers, the company also markets the product using advertising. The ads are photographs, testimonials and sharing directly from the users so that customers who have health complaints and problems similar to or similar to them can be interested in trying and buying their products. REFFERENCES Badan Penelitian dan Pengembangan Kesehatan Kementerian Kesehatan RI. Penyajian PokokPokok Hasil Riset Kesehatan Dasar 2013. Avalable at: http://www.pusdatin.kemkes.go.id (Accessed: 2 Oktober 2016) Emzir. 2012. Metodologi Penelitian Pendidikan. Jakarta: PT Raja Grafindo Heruwasto, Ignatius & Arrina Wulan Aprilia. Faktor Penentu Kepuasan dan Loyalitas Pelanggan dalam Layanan Jasa Penerbangan: Studi Kasus Pada Pengguna Lion Air. Jurnal Manajemen Usahawan Indonesia Vol. 41 No.4. Juli–September 2012. Hurriyati, Ratih. 2010. Bauran Pemasaran dan Loyalitas Pelanggan. Bandung: Alfabeta. Irawan, Handi. 2008. Sepuluh Prinsip Kepuasan Pelanggan, Penerbit Elex Media Komputindo Kelompok Gramedia Jakarta. Khaled, Alkilani. 2012. The Impact of Experiential Marketing and Customer Satisfaction on Customer Commitment in the World of Social Networks. Asian Social Science. Kotler, Philip & Armstrong, Gary. 2014. “Principles of Marketing” (14th Edition). Pearson, New Jersey. Kotler, Philip and Kevin Lane Keller, 2011. Manajemen Pemasaran, Edisi 13 Jilid 1 dan 2, Alih Bahasa : Bob Sabran, Erlangga, Jakarta. Kotler, Philip dan Garry Amstrong. 2012. Principles Of Marketing. New Jersey: Pearson Education Limited. Lucas, Robert W. 2012. Customer Service: Skills For Success, Fifth Edition (New York: McGraw-Hill Companies, Inc. 2012: 363. Moleong, Lexy J. 2013. Metode Penelitian Kualitatif. Edisi Revisi. Bandung: PT. Remaja Rosdakarya. Nasution M. N. 2010. Manajemen Jasa Terpadu. Bogor: Ghalia Indonesia. Sugiyono. 2012. Memahami Penelitian Kualitatif. Bandung: Alfabeta. Sugiyono. 2011. Metode Penelitian Kuantitatif, Kualitatif, dan R&D. Bandung: Alfabeta. Sugiyono. 2013. Metode Penelitian Kuantitatif Kualitatif dan R & D. Bandung : Alfabeta. Sujarweni, V dan Poly Endrayanto. 2012. Statistika untuk Penelitian. Yogyakarta: Graha Ilmu. Sunyoto, Danang, 2013. Perilaku Konsumen, CAPS (Center of Academy Publishing Service), Yogyakarta. Surtiawan, Dwi. 2006. Kepuasan Pemakai dan Peningkatan Kualitas Berbasis Pemakai. Universitas Negeri Yogyakarta, Yogyakarta. Tjiptono, Fandy. 2011. Service, Quality & Satisfaction. Yogyakarta: CV Andi.

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ONLINE MARKETING STRATEGY OF HOT WHEELS PRODUCT USING MARKETING MIX ¹Henry Samuel Tanuwijaya, 2Tina Melinda♠ Ciputra University Surabaya INDONESIA Email: [email protected], [email protected]

ABSTRACT This research is done based on the potential growth of Hot Wheels business and sales via online in Indonesia. The main purpose of this study is to increase Hot wheels car collections sales by maximizing techniques and new ways of internetmarketing. The study titled 'Online Marketing Strategy of Hot Wheels Product using Marketing Mix' was made using a qualitative approach through interviews with three informants, among others are: wholesaler, Kolekdol, and collectors. The data obtained willthen be applied to the marketing mix theory and will be used as a sales strategy, based on Product, Price, Promotion and Process. Based on the result of these research, we concluded that the application of marketing mix theory, which in this case include Product, Price, Promotion and Process, on internet marketing is able to increase traffics on our Facebook fans page and also able to boost the sales of our product via online. Keywords : Online Auction, facebook, Hot Wheels, diecast, , marketing mix, product, price, promotion, dan process. INTRODUCTION The development of telecommunication technology and the Internet caused the changes of our daily culture. Advancement in technology and information is increasingly making human needs grow and more complex. Shopping is an activity that is already a part of people's lives. One shopping alternative that has followed the lifestyle now is online shopping. Based on the UCLA Center for Communications Policy (The University of California, Los Angeles), online purchases have become a popular activity to date (Tarigan, 2012). Based on a survey of the use and application of Information and Communication Technology and Facilities (P2SKTI) 2013, 77.81% of internet usage is intended to seek information of goods or services. According to market research institute e-Marketer, netter population of the country reached 83.7 million people in 2014. The number that applies to every person who access the internet at least once every month put Indonesia in the 6th largest in the world in terms of the number of internet users. Director of International Information Services Directorate General of Information and Public Communication (IKP), Selamatta Sembiring said, the most widely accessed social networking sites are Facebook and Twitter. Indonesia is ranked as the 4th largest Facebook user after USA, Brazil and India. According to data from Webershandwick, a public relations company and service provider of communication, for the region of Indonesia there are about 65 million active Facebook users. As many as 33 million active users per day, 55 million active users who use mobile devices in access per month and about 28 million active users who use mobile devices per day Collecting traditions diecast start riding when one of the largest diecast

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company brands Hot wheels released the series Treasure Hunts or often called T-Hunts in 1995, where the T-Hunts series is a series produced in limited and unique quantities, usually with exclusive paint and rubber tires. And since then the activity of collecting diecast cars is getting popular. According to Turban et al. (2012: 38), electronic commerce (electronic commerce, abbreviated EC, or e-commerce) encompasses the process of purchasing, selling, transferring or exchanging products, services or information through computer networks, including the internet. According to Kotler et al. (2012: 4) marketing is managing profitable customer relationships. The dual purpose of marketing is to attract new customers by promising superior value and retaining current customers and growing by providing satisfaction. The purpose of this study is to increase sales of Hot Wheels car collection by maximizing new techniques and ways in internet marketing science. LITERATURE REVIEW Online Marketing Strategies According to David in Maryam Saghei (Maryam & Shojaee, 2012) Strategy is a tool that companies can use to achieve their long-term goals. And Marrus in Widhiyanti (2012) says that strategy is defined as a process of determining the plans of top leaders that focus on the organization's long-term goals, along with the preparation of a way or effort how to achieve that goal. According to Kotler and Armstrong (2014: 27) Marketing is the process by which companies create value for customers and build strong customer relationships in order to capture value from customers in return. According to Kotler and Keller (2012: 5) Marketing is about identifiying and meeting human and social needs. One of the shortest good definitions of marketing is meeting needs profitably. According to Daryanto (2011: 1) which describes marketing as a social and managerial process whereby individuals and groups get their needs and desires by creating, offering and exchanging something of value to each other. Marketing strategy is the design, implementation, and control of plans to influence exchange in order to achieve organizational goals (Peter and Olson, 2013: 12). Marketing strategy is an effort to provide and deliver the right goods or services to the right people and in the right time and price and with the right promotion and communication (Assauri, 2013: 5). Where the strategy of each company is an overall plan to achieve goals (Paul, 2011: 17). Strategies are also understood as a pattern that embodies both the planned strategy and the strategy that was not originally intended by the company but to be a strategy even considered by the company to be implemented (Chandler in Ismail, 2011; 64). According to (Gupta et al., 2012) the term e-marketing is also known as internet marketing, web marketing, online marketing. In addition Utomo (2011) said that in running a business online or over the internet, the factors that play an important role in determining the success of business implementation is a factor of trust. Online Marketing commonly referred to as internet marketing or electronic marketing where in it is internet as a marketing medium is a marketing method part of E-business that utilizes electronic media to conduct marketing activities in an effort to achieve marketing objective of a commercial company (Ahmadi et al., 2013). The forms of internet marketng are usually embodied in online banner advertising, online sponsorship activities, clarification of product lists on websites, email marketing, partnership, search engine marketing, and social networking (Ahmadi et al., 2013). As the internet has matured and its ability to perform as a branding channel has been recognized, marketing advertising as evidenced by its growing role in the marketing budget (Robert and Zahay, 2013: 169). So it can be concluded that online marketing is a new digital technology by utilizing the internet that can offer many benefits such as increasing revenue, reducing costs and increasing the size of the company's market. Marketing Mix

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Kotler and Armstrong (2012: 58) states that the marketing mix: The set of controllable tactical marketing tools-product, price, place, and promotion-that firm blends to produce the response it wants in the target market. Kotler and Keller (2012: 47) classify the marketing mix into four groups called 4P, namely price, place, product, and promotion. a. Product, is anything that can be offered to a market for attention, acquisition, use, or consumption that might satisfy a want or need b. Price is the amount of money changed for a product or service c. Place is a set of independent organizations that help make a product or service available for use consumption by the consumer or business user d. Promotion is the specific blend of advertising, sales promotion, public relation, personal selling, and direct marketing tools that the company uses to persuasively communicate customer value and build customer relationship Kotler and Keller (2012: 25) add four components in the marketing mix called Modern Marketing Management Four Ps: 1. People reflect the part of internal marketing and in the fact that employees are essential to marketing success. 2. Processes, reflecting all the creativity, discipline, and structure that brings to marketing management. Marketers should avoid ad hoc planning and decision making and ensure that marketing ideas and concepts play and fit all the roles they perform. 3. Programs, reflecting all the direct activities of the company's consumers. 4. Performance is an integrated outcome and marketing to capture the range of possible outcomes that have implications for financial and nonfinancial (profitability and brand and customer equity) and external consequences of the company itself (corporate social responsibility, law, ethics and related societies) Lovelock (2011: 44) states that for the service marketing mix need to add 3Ps namely: process, physical environment, and people, in detail explanation of 4Ps and 3Ps according to Lovelock (2011: 44) as follows: 1. Product elements, including core products that respond to primary customer needs and prepare from complementary service elements that are mutually reinforcing value-added devices that help customers to use core products more effectively. 2. Place and time, refers to the delivery of elements of the product to the customer, a lot of information - the process elements are delivered electronically. 3. Pricing, including considerations.

non-monetary

costs

to

consumers

and revenue management

4. Promotion, also seen as a form of customer communication and guiding education through the service process, not just advertising and promotion. Service marketing requires additional 3P management services including direct interaction with customers: 5. Process, refers to the design and management of customer service processes, including requiring and managing related capacities and related customers, implementing strict service quality management, more careful employee training, and automating tasks previously undertaken by humans. 6. Physical environment, also known as servicescape, provides tangible proof of the image and quality of the company's services and facilitates the delivery process.

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7. People, including recruitment, training, and motivating service employees to provide quality service and productivity. The three new elements of the marketing mix (people, physical evidence and process) are included in the marketing mix as separate elements because they are in control of the firm and because each element or the three will influence the consumer's initial decision to purchase a service in accordance with the level of customer satisfaction . Product Products are everything that is offered to the market to satisfy a desire or need, including physical goods, services, experiences, events, people, places, property, organizations, information, and ideas (Kotler & Keller, 2009: 4). According to Assauri (2012: 118), Products are the total packaging of the benefits created or provided by an organization to be offered to targeted users. In planning its market offerings, marketers should look at five levels of products. Each product level adds a larger customer value and all five are part and hierarchy of customer value. According to Kotler and Armstrong (2012: 283) the meaning of product quality is: the ability of a product to perform its functions, it includes the product's overall durability, reliability, precision, ease of operation and repair, and other valued attributes. Price According to Assauri (2012: 118), Price is a burden or value for the consumer, obtained by obtaining and using a product, including the financial costs of consumption, in addition to nonfinancial social costs, such as in the form of time, effort, psychic, risk and prestige or social prestige. Price has many forms and performs many functions. Rent, tuition, fees, wages / fees, interest, tariffs, fees, deposits, salaries and commissions are all costs. Prices are set through negotiations between buyers and sellers (Kotler and Keller, 2009: 68). According to Kotler and Keller (2009: 63), states that the price dimension consists of: 1. Price List Price list is information about the price of the product offered so that consumers consider buying. 2. Discount (Rebate / Discount), is the discounted / discounted rate the seller gives to the consumer. 3. Allowance (Special discount), ie discounts given by the seller to the consumer at certain events. 4. Payment Period (Period of payment), is the ease of payment provided by the seller to the consumer in the form of leniency period of payment made by the consumer in the purchase transaction. 5. Credit Term (Terms of credit), is a credit payment system that the seller gives to the consumer within a predetermined period of time with additional payment of interest to be paid. According Natalisa and Fakhriansyah in Widyaningtyas (Aji, 2011: 26), states that the measurement of price indicators is measured by using price conformity factor with service. In this study, price measuring is measured using indicators as follows: price list, discount, and payment period. Promotion According Daryanto (2011: 94) Promotion is the last activity of the marketing mix is very important because now most of the market is more market buyers where the last decision of the

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sale and purchase transactions is strongly influenced by consumers. According to Kotler and Armstrong (2012: 76): Promotion means activities that communicate the merits of the product and persuade target customers to buy it. According to Grewal and Levy (2013: 8), Riswandani (2013) Promotion has the meaning of a communication provided by marketers to convey information, give confidence and remind potential buyers about a pruduk in order to influence the opinions of buyers and get a response. Sales promotion according to Hermawan (2012: 129) is a marketing activity that can provide more value of a product within a certain period to increase purchases from consumers, effective sales, or support efforts that have been done by marketers. Any company doing promotional activities of course the main purpose is to seek profit. According Rangkuti (2010: 51), generally promotional activities should be based on the following objectives: modify behavior, notify, persuade, and remind. Process Zeithaml et al. (2013: 27) explains that: Process is the procedures, mechanisms, and flow of activities by which the service is delivered-the service delivery and operating systems. Kotler and Keller (2012: 25) suggests that: Processes reflects all the creativity, discipline, and structure brought to marketing management. Marketers must avoid ad hoc planning and decision making and ensure that state-of-the-art marketing ideas and concepts play and appropriate role in all they do. Only by instituting the right set of processes to guide activities and programs can a firm engage in mutually beneficial long-term relationships. Another important set og guides the firm in imaginatively generating insights and breakthrough products, services, and marketing activities. Zeithaml and Bitner (2006: 27) states that: The process is the actual procedure, the mechanism, and the flow of activities by which the service is delivered - the service delivery and operating system. Buchari Alma (2007: 34) suggests that: "This process occurs outside the view of consumers. Consumers do not know how the process takes place, the important services he receives must be satisfactory. According to Lupiyoadi (2013: 98), the process is a combination of all activities, which generally consist of procedures, work schedules, mechanisms, and other routine matters, where services are generated and delivered to consumers. According to Lupiyoadi and Hamdani (2009: 76), the process is a combination of all activities, generally consisting of procedures, work schedules, mechanisms, activities and routine matters, where services are generated and delivered to consumers. RESEARCH METHODS This research uses research type with qualitative approach. According to Bogdan and Biklen (in Sugiyono, 2013: 13) states one of the characteristics of qualitative research is descriptive so that the data collected in the form of words or images so as not to emphasize the numbers. And Moleong (2013: 16) states that qualitative research methods generate descriptive data in the form of written or oral words about the nature of an individual, circumstances, symptoms of a particular group that can be observed. Thus, in this study, products, prices and processes of the 7P theory play an important role in the sale of Hot Wheels online according to surveys conducted. After that, also described the results of interviews with informants. The descriptions of interview results are collaborated as research objects that are studied to answer the formulation of the previously proposed problem. Subjects and Research Objects Moleong (2010: 132) describes the subject of research as an informant, which means people in the background research that is used to provide information about the situation and condition of the research background. In line with the definition. In this study the subject is: 4. Seller big successful in selling Hot wheels products for at least 5 years and growing. And every month at least twice held an auction through social media facebook fanpages.

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5. Kolekdol are successful by buying for collection and at the same time sell it again through the media facebook fanspage. Collectors who often buy either directly through facebook or by following the auction. According Sugiyono (2012: 38), understanding of the object of research is an attribute or the nature or value of people, objects or activities that have a certain variation set by researchers to learn and then drawn conclusions. In this study, the object of research is the quality of Hot wheels products, prices, and process. Validity and Reliability According Sugiyono (2011: 2), valid indicates the degree of accuracy between the actual data occurs on objects with data that can be collected by researchers. According Sujarweni and Endrayanto (2012: 177) Test validity is used to determine the feasibility of the items in a list of questions in defining a variable. In this research, the researcher uses triangulation technique to test the truth of the data. Triangulation in a research is important if researchers really want accurate data. According Sugiyono (2011: 330), triangulation techniques are defined as data collection techniques that are combining from various data collection techniques and data sources that already exist. According Sugiyono (2012: 273), Triangulation Source technique is done by examination of data obtained through various sources. Typically, this process involves amplifying evidence from a variety of different sources to explain themes or perspectives. Sugiyono (2011: 3), reliability with respect to degree of consistency data in certain time interval. Reliability test in this research using dependability technique, researcher do trace during process by see consistency of answer obtained from resource during data collection process. Dependability techniques are based on the assumption of repetition and replicability (Emzir, 2012: 80). RESULTS AND DISCUSSION Product Rankings Knowledge of the level of the product is very important both for collectors, sellers, Dropshipper, and also Kolekdol. Due to any increase or addition of the function of the product has an increase or increase in the sale value as well. According to Ali Hasan (2013, p494) we define product concept as a form of product offer both tangible (goods) and intangible (services) to be noticed, requested, sought, bought, used, or consumed to meet the needs or desires of consumers. According to Kotler and Keller are converted bahasakan by Bob Sabran (2011: 4) products have 5 levels, namely Core Benefit, Basic Product, Expected Product, Augment Product, Potential Product. The company that produces Hot wheels, Mattel expand its business by producing more variants since 1970. And also produce Hot wheels track that can add fun to racing it. As more variants and innovations are added through the production of Hot Wheels cars, their functionality becomes wider not only for children to play, but also collected by collectors of all ages. Hot Wheel Levels as an Augmented Product are also growing since the release of Treasure Hunts products in 1995. Hot Wheels were originally only collected by children, but over the past 15 years many adults have also collected. Price According to Kotler and Keller being translated by Bob Sabran (2011: 67), price is a marketing mix element that generates income, other elements generate costs. According to Tjiptono (2011: 151) states that the price meruakan the only element of the marketing mix that provides income or income for the company. Meanwhile, according to Kotler and Armstrong (2011: 345), the

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price is a sum of money that is levied on a product and service or the sum of the value exchanged by customers to benefit from owning or using a product or service. So in sales Hot wheels through Facebook media made sales through auctions. So the price is determined by the buyer consisting of collectors, resseler, and also kolekdol. Later the price created is a fair price for both buyers and sellers. And generally the price is not far from the market price, can be higher or lower depending on the number of enthusiasts and the scarcity of items. The open bid price is kept as low as possible to attract customers following the auction in our place, the benchmark for the low is between 30-50% below the market. And the additional value of the bid can generally be pegged between 5 thousand to 10 thousand rupiah. Should be a multiple that can be divided into 5 thousand dollars to facilitate the time of the auction recap. Payment period should also be given time limit, if too fast will give inconvenience to buyer, whereas if too long then often buyer forget to pay off. So the proper time for repayment is 3 days to a week. Promotion According to Rangkuti (2010: 50), Promotion is sales and marketing activities in order to inform and encourage the demand for products, services, and ideas from the company by influencing consumers to buy products and services produced by the company. According to Michael Ray in (Morissan, 2010: 16) promotion is the coordination of all efforts initiated by the seller to build various channels of information and persuasion to sell goods and services or introduce an idea. Based on research conducted by Schmitt et. All (2011) says that Word of Mouth (WOM) has reemerged as an important marketing phenomenon, and its use as a customer acquisition method has begun to attract renewed interest. Promotion through paid advertising is usually used Facebook Ads that can target to the segmentation who want to shoot. So that Ads can appear on the page facebook prospective buyers according to segmentation that has been set previously. With the expectation of Clossing percentage become larger. Noteworthy is how much should be spent on this ad, so as not to become a burden in the future so that the price of our products become expensive. In addition to providing paid advertising services, facebook also allows users to freely utilize free facilities to capture as many potential customers either through Fanpage or Facebook Group. Process Buchari Alma (2007: 34) suggests that: This process occurs outside the view of consumers. Consumers do not know how the process takes place, the important services he receives must be satisfactory. The process involves selecting marketable products, product photos, inter group promotion, speed and ease of service, speed of customer inquiry, speed of delivery after payment is received, after sales service and so on. In the future to provide the best for the customer, every month should be a review of the whole process, what deficiencies are encountered. After that planned techniques and innovations that need to be done for next sale. CONCLUSION Based on the results of research and discussion that has been done on the marketing strategy of hot wheels product using marketing mix, it is concluded that STP (Strategy, Targeting and Positioning) is very important and vital, with STP, it is concluded that the largest market of online diecast sales through Facebook is a diecast market with a scale of 64 incorporated in groups of collectors and kolekdol. Knowledge of products that sell in the market and product prices are very important. The selling price is determined by the buyer through the auction system. So as to create a fair value for both buyer and seller. The open bid price for the auction is kept as low as possible to attract buyers following the auction in our place, the benchmark for the low is between 30-50% below the market price. And the additional value of the bid can generally be pegged between 5 thousand to 10 thousand rupiah. Direct selling items are given to

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buyers who lose the auction with the condition we have the double item from the item that we auction. The direct selling price is the same as the price won, with the price of the item is already profit and at least equal to the market price. The payment period given the time limit for repayment is 3 days to one week. Hot Wheels product sales promotion online through Facebook media can be done through advertising. Advertising can be paid on a paid Facebook ad, or free of charge. WOM promotion is a free promotion that is gained from the satisfaction felt by the buyer after receiving the products and services we provide. The emphasis of the process is the service / service is good for customers. Starting from a product photo, answering buyer questions, charging, and until the items are well received are the best service delivery targets for returning buyers to become regular customers. REFFERENCES Ahmadi , Hermawan, 2013. E-Business & E-Commerse. Andi: Denpasar. Assauri, Sofjan. 2012. Manajemen Pemasaran. Jakarta: Rajawali, Gramedia Pustaka Utama Assauri, Sofjan. 2013. Strategic Management: Sustainable Compatitive Advantages. Jakarta: Cetakan Pertama, Rajawali Persada. Buchari Alma.2007, Manajemen Pemasaran & Pemasaran Jasa. Bandung: CV. Alfabeta. Daryanto, 2011, Sari Kuliah Manajemen Pemasaran, Bandung: PT Sarana Tutorial Nurani Sejahtera. Edison, Daud Tarigan. 2012. Membangun SMS Gateway Berbasis Web Dengan Codeigniter. Yogyakarta: Lokomedi Grewal, D dan Levy, M. 2013. Marketing. New York :McGraw-Hill/Irwin. Hasan, Ali. 2013. Marketing dan Kasus-Kasus Pilihan. Yogyakarta: CAPS Hermawan, A. 2012. Komunikasi Pemasaran. Jakarta: Erlangga. Hermawan, A. 2012. Komunikasi Pemasaran. Jakarta: Erlangga J. Paul Peter dan Jerry C. Olson (2013). Perilaku Konsumen dan Strategi Pemasaran. Jakarta: Salemba Empat. Kotler, P. & Armstrong, G. 2012. Principles of Marketing. New Jersey: Pearson Education Limited. Kotler, P. & Keller, K. L. 2009. Manajemen Pemasaran. Edisi 13. Jilid 1. Jakarta: Erlangga. Kotler, P. & Keller, K. L. 2012. Marketing Management. New Jersey: Pearson Education Limited. Kotler, P. dan Keller, K.L. 2012. Marketing Management, 14th Edition. England: Pearson Education Limited Kotler, P. dan Keller, K.L. 2012. Principle of Marketing, New Jersey: Prentice Hall Kotler, Philip. & Gary Armstrong. 2014. Principle Of Marketing, 15th edition. New Jersey: Pearson Prentice Hall. Kotler, Philip and Kevin Lane Keller, 2011. Manajemen Pemasaran, Edisi 13 Jilid 1 dan 2, Alih Bahasa : Bob Sabran, Erlangga, Jakarta. Lovelock, Christopher, Jochen Wirtz dan Jacky Mussry (2011): Pemasaran Jasa – Perspektif Indonesia Jilid 1. Edisi Ketujuh, Jakarta: Erlangga. Lupiyoadi, R. dan Hamdani, A. 2009. Manajemen Pemasaran Jasa. Jakarta: Salemba Empat. Lupiyoadi, Rambat, (2013): Manajemen Pemasaran Jasa. Jakarta: Salemba Empat. Moleong, L. J. 2010. Metodologi Penelitian Kualitatif, Bandung: Remaja Rosda Karya. Moleong, Lexy J. 2013. Metode Penelitian Kualitatif. Bandung: PT. Remaja Rosdakarya. Morissan, 2010, Periklanan: Komunikasi Pemasaran Terpadu, Prenada Media Group, Jakarta Rangkuti, Freddy. 2009. Strategi Promosi Yang Kreatif & Analisis Kasus Integrated Marketing Communication. Jakarta : PT Gramedia Pustaka Utama Riswandani, Yeni Tri Seri. 2013. Pengaruh Fasilitas, Biaya, dan Promosi Terhadap Kepuasan Pasien Rawat Inap. Daya Saing Jurnal Ekonomi Sumber Daya. Vol. 14, No. 2, pp. 88-89

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Roberts, Mary Lou dan Zahay, Debra, (2013): Internet Marketing : Integrating Online & Offline Strategies -3/E, USA : South-Wester Cengage Learning. Saghaei, Maryam., Fazayeli, Leila., Shojaee, Mohammad Reza. (2012). Strategic Planning For A Lubricant Manufacturing Company. Australian Journal of Business and Management Research. 1(10): 18-24. Schmitt, Skiera & Van Den Bulte Bernd (2011) Referral Programs and Customer Value. Journal of Marketing, Vol. 75 Issue 1, p1. Sugiyono. 2012. Memahami Penelitian Kualitatif. Bandung: Alfabeta. Sugiyono. 2011. Metode Penelitian Kuantitatif, Kualitatif, dan R&D. Bandung: Alfabeta. Sugiyono. 2014. Metode Penelitian Manajemen. Bandung. Alfabeta. Sujarweni, V dan Poly Endrayanto. 2012. Statistika untuk Penelitian. Yogyakarta: Graha Ilmu. Turban, E. (2012). Electronic Commerce 2012. Pearson 7th-Global Edition. Wisnuwardhani, et al. 2015. Upaya Peningkatan Penjualan Baju Bekas Melalui Media Facebook. Jurnal Administrasi Bisnis (JAB). Vol. 1, No. 1 Januari 2015. Yanuaria, Lusi Widhiyanti. 2012. Strategi KAI Dalam Meningkatkan Pelayanan Transportasi KA. Skripsi. Universitas Negeri Yogyakarta Zeithaml, Bitner and Gremler, 2006, Service Marketing, Fourth edition, Prentice Hall; exclusive right by Mc Graw-Hill. Zeithaml, V. A., Bitner, M. J., & Gremler, D. D. (2013). Service Marketing, Sixth Edition. America: Mc Graw Hill. www.bps.go.id

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THE EFFECT OF SERVICE QUALITY AND PRICE TOWARD CUSTOMERS’ SATISFACTION AT TOKO RAJA PULSA – TERNATE 1

Puspita. D, 2Thomas Stefanus Kaihatu♠ Ciputra University Surabaya INDONESIA ABSTRACT

There has been a rapid growth on technology recently which is as unstoppable as the wave in the ocean. Besides, the social media has been widely known and used by people in all ages and social class around the world. These rapid changes have significantly increased people’s spending on internet and cellphone credit. Looking at this phenomenon, the writer and other businessmen are encouraged to open credit counter business in every places and area. Indonesia, as one of developing countries, provides people with several cellular providers. Therefore, people should be careful and smart in spending money for internet and cellphone credit. Although Indonesia consists of many islands, not all areas are covered by cellphone provider. Certain cellular providers dominate some areas as they are able to reach those areas. Then people see cellphone credit business is easily done anywhere by anybody. As a mean of service business, this study is conducted to measure the service quality and price offered affect customers’ satisfaction. However, each credit counter business possesses its own strength and weaknesses. The objective of this study is to figure out how far service quality and price offered have affected customers’ satisfaction. Method used in this study is questioner which has been distributed to 75 customers of Toko Raja Pulsa to be further analyzed afterwards. Keywords: customers’ satisfaction, price and service quality INTRODUCTION In this globalization era, company is demanded to care more about customers’ demand and desire. Thus, company should be able to give its best service to maintain customers’ satisfaction unless its competitor may take advantage of this. The quality itself has a strong bond or link toward customers’ satisfaction, in which quality motivates customers to make the strong bond with the company. Looking at the unstoppable development in this era, the competition within cellular provider is tightened. Many telecommunication products exist and compete tightly to grab as many customers as possible. The geographic position of Indonesia, which consists of many islands, makes several cellular providers are not able to reach the outer areas of Java. This condition makes an inequality in the competition itself as only one cellular provider dominates the main islands outside Java. Later on, this is related with the performance and the amount of customers. For example, in Maluku Island there is only one cellular provider which dominates the networking there strongly. Each cellular provider competes to get its customers; as a result, the greater the customers’ provider, the stronger the provider’s reputability for people there. Besides, many credit sellers or kiosks

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exist in the area. The credit sellers or kiosks existence provides people with difficulty in choosing where to buy. The credit sellers or kiosks is then demanded to innovate themselves to avoid bankruptcy. The service quality and price take important roles in doing so. Customers’ satisfaction cannot be seen barely, instead by observing the after sales. It can be seen when the customers go back to the place several times, or even become the loyal customers. LITERATURE REVIEW The previous study was done by Atmaja (2011) on Analisis Pengaruh Kualitas Layanan Terhadap Kepuasan Pelanggan ( Studi pada Tiket Garuda di PT. Falah Fantastic Tour Travel Bogor). In this study, the writer used customers’ satisfaction as dependent variable (Y) and service quality as independent variable (X). From the study, it was found that service quality affects positively and significantly toward customers’ satisfaction. Besides, another study was conducted by Subagio (2013) on Pengaruh Kualitas Layanan Terhadap Kepuasan Pelanggan Restoran Ayam Penyet Ria. The writer took service quality as independent variable. The result of the study showed that service quality simultaneously and significantly affect customers’ satisfaction of Ayam Penyet Ria. In one study which used SERVQUAL theory proposed by Parasuraman et al., there were five dimensions placed on the service quality. They were tangibles, reliability, responsiveness, assurance and empathy. Each dimensions possessed several indicators. Price is defined as the value of a thing, declared by money (Alma, 2013). Besides, price can also be defined as cost given by producer to consumer (Nirwana, 2012). Lovelock in Fadillah (2015) stated that, “customers’ satisfaction is an emotional condition and customers’ after sales reaction in form of anger, dissatisfaction, aggravation, joyful, pleasant or neutral.” RESEARCH METHODS In this study, the method used is questioner or survey. The sample is taken from certain population and location which is Ternate Island. The population is the whole customers in one of the store in Ternate, in which they are actively purchase cellular credit. The total population is 300, using Slovin formula there is 75 samples that represent the whole population. Technique used is probability sampling. Questioners are distributed to respondents. The variables of this study consist of independent variables (X) which are tangibles (X1), reliability (X2), responsiveness (X3), assurance (X4), empathy (X5) and price (X6) with dependent variable (Y) customers’ satisfaction. The data analysis technique used in this study is quantitative in nature that used statistic accountability of number to be interpreted in form of description or narration. Test used are F test, t test, classic assumption test and coefficient of determination (R2). Validity test shows the instrument capability to measure the things measured. This study used Product Moment Pearson test in which the correlation of each score and total score is aimed to figure out the properness of each statements in defining one single variable. The validity is accepted on the account of significant level <0.05. Reliability test is used to find out how far the questioners are trustworthy or reliable using the method of Cronbach alpha > 0.6 and the score of Cronbach alpha if deleted is less than Cronbach alpha. On the other hand, the analysis technique is multiple analysis in which used for more than two variables. The classical assumption test used consists of normality test, multicollinearity test, Heteroskedasticity test, autocorrelation test, and Linearity test. RESULTS AND DISCUSSION The total respondent of this study is 75 people which is 24% male and 76% female. From the result of the study using Validity test Product Moment Pearson method, it is earned sig value for each variable X1, X2, X3, X4, X5, X6 and Y less than 0.05. Thus, it can be stated that all the items on variables used in this study are valid. Reliability test is used to figure out how far the

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instrument used is proper or reliable. Using the Cronbach Alpha > 0.6 method, it is proved that variables X1, X2, X3, X4, X5, X6 and Y have got cronbach alpha value > 0.6. The instrument is reliable. Normality test is used to figure out whether the residual variable is distributed normally. Using the Kolmogrov-Smirnov test with sig value > 0.05 it is found out that the score of normality test with significant value is 0.709 which is more than 0.05. Therefore, the residual data is distributed normally. Multicollinearity test is used to figure out whether there is a linier relation among independent variables. By looking at the VIF value < 10, it can be stated that there is no multicollinearity. VIF value for each independent variable: tangibles (X1), reliability (X2), responsiveness (X3), assurance (X4), empathy (X5) and price (X6) is 2.070; 1.996; 2.349 ; 2.333 ; 2.190 and 1.647. Since the VIF value of all is <10, it can be said that there is no multicollinearity among the independent variables. Autocorrelation test is used to figure out whether there is correlation between mistake from t period and the previous period within one linier regression. Using the Durbin-Watson test with the sig value 0.05 it is found out that: Within a study of n (the amount of sample) = 75, and k (the amount of independent variables) = 6; Du value = 1.8013 and (4-Du) = 2.1987 from the Durbin-Watson table. Besides, from the table it is figured out that DW value is 2.052. Since the criteria of having no autocorrelation is DW value should be located between Du and (4-Du), it can be sketched Du < DW < (4-Du) is 1.8013 < 2.052 < 2.1987. To conclude, there is no autocorrelation. Heteroskedasticity test is a condition where there is no similarity in residual variable on regression model (Priyatno, 2013). This study use the Glejser test by regressing the absolute residual value collected from regression model. The requirement of no Heteroskedasticity is by having sig value > 0.05. Tangible (X1), reliability (X2), responsiveness (X3), assurance (X4), empathy (X5) and price (X6) is each for 0.618, 0.673, 0.945, 0.171, 0.707 and 0.5. It can be seen that the sig value > 0.05. Thus, there is no Heteroskedasticity in residual variable and the regression result is proper to produce decision. Linearity test is used to figure out the linearity relation between data connected with the sig linearity value < 0.05. From the test it is found that all the variables have got sig linearity value less than 0.05 and therefore fulfilled the criterion of linearity test. Double regression test analysis is used to figure out the effect of more than two variables toward dependent variable (Sunyoto, 2012).

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Table 1 The Results of Double Regression Standardized Coefficients

Unstandardized Coefficients Model B

Std. Error

Beta

(Constant)

0.770

0.131

X1

0.004

0.34

0.006

X2

0.008

0.035

0.011

X3

0.094

0.036

0.147

X4

0.071

0.035

0.111

X5

0.098

0.031

0.166

X6

0.556

0.037

0.693

From Table 5.33 the double regression value that can be deduced is as follows: Y = 0.770 + 0.004X1 + 0.008X2 + 0.094X3 + 0.071X4 + 0.098X5 + 0.556X6 F test shows that all the independent variables put in the model have affected simultaneously toward the dependent variable. Below is the result of F test : Table 2 F Test Result Model

Sum of Squares

df

Mean Square

F

Sig.

Regression

9.696

6

1.616

115.434

0.000

Residual

0.952

68

0.14

Total

10.647

74

Source: Appendix E Based on table 5.34 it is known that the sig value is 0.000 which < 0.05 with F value for 115.434. It means that the variables of tangible (X1), reliability (X2), responsiveness (X3), assurance (X4), empathy (X5) and price (X6) are simultaneously and significantly affected the customers’ satisfaction (Y). Through T test is produced the analysis of each variables toward the dependent variable (customers’ satisfaction). Below is the result of T test: Table 3 t test Result

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Unstandardized Coefficients

Standardized Coefficients

t

Sig.

5.893

0.000

Model B

Std. Error

Beta

(Constant)

0.770

0.131

Tangible (X1)

0.004

0.034

0.006

0.112

0.911

Realibility (X2)

0.008

0.035

0.11

0.220

0.827

Responsiveness (X3)

0.094

0.036

0.147

2.638

0.010

Assurance (X4)

0.071

0.035

0.111

2.002

0.049

Empathy (X5)

0.098

0.031

0.166

3.101

0.003

Price (X6)

0.556

0.037

0.693

14.884

0.000

Source: Appendix E There are several findings found in the table. First, the sig value of tangible (X1) variable in the table is 0.911 in which bigger than 0.005. Thus, Ho is accepted and Ha is rejected. It means tangible (X1) variable, individually, has no significant effect toward customers’ satisfaction (Y). Second, the sig value of reliability (X2) variable in the table is 0.827 in which bigger than 0.05. Therefore, Ho is accepted and Ha is rejected. It means reliability (X2) variable, individually, has no significant effect toward customers’ satisfaction (Y). Third, the sig value responsiveness (X3) variable in the table is 0.01 in which less than 0.05. As a result, Ho is rejected and Ha is accepted. In other words, the responsiveness (X3) variable, individually, affects the customers’ satisfaction (Y) significantly. Fourth, the sig value of assurance (X4) variable in the table is 0.049 in which less than 0.05. Hence Ho is rejected and Ha is accepted. It can be inferred that assurance (X4) variable, individually, has affected the customers’ satisfaction (Y) variable significantly. Fifth, the sig value of empathy (X5) variable in the table is 0.003 in which less than 0.05. Then, Ho is rejected and Ha is accepted which means empathy (X5) variable , individually, affected the customers’ satisfaction (Y) variable significantly. Sixth, the sig value of price (X6) in the table is 0.000 in which less than 0.05. This resulted in the rejection of Ho and acceptance of Ha. In other words, price (X6) variable, individually, has affected the customers’ satisfaction (Y) variable significantly. The coefficient of determination test (R2) is used for measuring the model’s capability in explaining the dependent variable. Table 4 The Coefficient of Determination Test Result Model

R

R Square

Adjusted R Square

Std. Error of the Estimate

1

0.954

0.911

0.903

0.11832

Source: Appendix E

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Based on table 5.36, the value of correlation coefficient (R) is 0.954 which revealed a strong bond between independent variable and dependent variable. The value of determination coefficient (R2) is 0.903 which explains there are 90.3% variants on dependent variable (customers’ satisfaction) related to independent variables oftangible (X1), reliability (X2), responsiveness (X3), assurance (X4), empathy (X5) and price (X6). The rest of it, 9.7%, is explain on the account of other variables which are not included in this study. CONCLUSION From the finding and discussion of this study, it can be concluded that tangible, reliability, responsiveness, assurance, empathy and price has affected positively and significantly toward customers’ satisfaction as a whole. Partially, there are two variables which does not significantly affect other variables: tangible and reliability. In this study, price has dominantly affected the customers’ satisfaction. The suggestion from this study for one of cellular credit counter in Ternate is to maximize the performance and honesty of the human resource. Besides, innovation should take place for the future products. On the other hand, another suggestion is for the next study. Further study should include other variables such as customers’ loyalty and the population should be taken from other places, such as Java, where competitiveness is more complex.

REFERENCES Atmaja (2011). ‘Analisis Pengaruh Kualitas Layanan Terhadap Kepuasan Pelanggan (Studi Pada Tiket Garuda di PT. Falah Fantastic Taour Travel). Jurnal Manajemen dan Bisnis. Vol XII. No 3. Pp. 129-140 Alma, B (2012). Pemasarandan Pemasaran jasa. Bandung. Alfabeta Fadilah, Z., (2015). ‘Pengaruh Harga dan Kualitas Pelayanan Terhadap Kepuasan Pelanggan Toko Online Lazada’. Skripsi Fakultas Manajemen Universitas Darma Persada. Jakarta Nirwana. (2012) Pemasaran Jasa. Malang: Alta Pustaka. Priyatno, D. (2013). Analisis Korelasi, regresi dan Multivariate dengan SPSS. Yogyakarta: Gava Media. Subagio. (2013). ‘Pengaruh Kualitas Layanan Terhadap Kepuasan Pelanggan Restoran Ayam Penyet Ria’. Jurnal Management, I (2), pp. 1-7. Sunyoto. D. (2009). Analisis regresi dan Uji Hipotesis. Jakarta: PT. Buku Kita.

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THE BENEFITS OF USING SUGARCANE LOADER FOR THE CUTTING-LOADING-TRANSPORTING MANAGEMENT AT SUGAR CANE FACTORY DJATIROTO, LUMAJANG Febrian Bagus Pakerti, 2David Sukardi Kodrat♠

1

Universitas Ciputra Surabaya INDONESIA Email :[email protected], [email protected] ABSTRACT This study aimed at investigating economic benefits, technical benefits, community empowerment benefits of sugarcane loaders towards cuttingloading-transporting management at the sugar factory (PG) Djatiroto, Lumajang. This study also examined the effectiveness of a manual cutting-loading-transporting method by using sugarcane loader at PG Djatiroto, Lumajang. Using a qualitative descriptive method, this study employed a purposive sampling technique. Interviews, observations, and documentation were among data collection techniques used in this present study. The selection of the key informants was determined on the basis of the expertise. Six people such as a general manager, a garden manager, a mechanization service provider, a farmer assistant, a aarmer, and an operator sugarcane loader became the key informants of the study. This study had the following research steps: to process and prepare data for further analysis, read the entire data, analyze data in more detail by providing codes, apply a coding process, show how to present descriptions and themes in narrative or qualitative reports, and interpret interpret data. The results of this study indicated the economic benefits of the use of sugarcane loader were hardly found because the system was not running optimally. The technical benefits of using sugarcane loader were feasible in the sense that the capacity of sugarcane loader has exceeded that of the manual. The benefits of community empowerment were not fully perceived as cutting employees for there was still resistance among female and male employees. Keywords: Sugarcane Loader, Cutting-Loading-Transporting Management, Sugar Cane Factory INTRODUCTION Agriculture plays an important role in Indonesia’s economic development. The majority of the people work in this sector. Agriculture in the broadest sense encompasses all activities utilizing animate objects such as plants, animals, and microbes for the benefits of people. An agricultural enterprise involves multiple sectors or subjects altogether for the sake of efficiency and profits. All agricultural enterprises are essentially economic activities requiring the same basic knowledge of the management of a business place, selection of seeds, methods of cultivation, product collection, product distribution, product processing and packaging, and marketing (Mareta, et al., 2011). One of the growing sectors is plantation. Soetrisno (2006) explains

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plantations are widely available in the country. Plantations in Indonesia become one of the potential agricultural sectors that can improve Indonesia’s economy. The demands for sugar in Indonesia will continue increasing as the population and income increase. The International Sugar Organization states sugar consumption is growing to 4% annually in order to meet the needs of 240 million people nationwide. Data in 2012 showed the total requirement of sugar consumption was 2.5 million tons per year (Kurniasari, 2015). Sugar cane is a strategic commodity because it serves primary raw materials for sugar manufactures. In 2014, 97 sugarcane industry companies were established in Indonesia. PTPN XI is one of the major state-owned companies that have a core business in the field of sugar. This company is the only state-owned company (SOE) that has a single commodity business, namely, sugar whose contribution is about 16-18% of the whole national production. The cutting-loading-transporting activity is one of the most important tasks in plantation. The accuracy and precision in planning and implementation affect a series of harvest cultivation and process in order to obtain maximum results. The cutting-loading-transporting should be done properly during the harvest so that high qualities of sugar and supplies for sugar cane raw materials can be sustainably obtained to accommodate the interests of Tebu Sendiri (TS) and Tebu Rakyat (TR). Harvesting of sugar cane can be done in two ways: manual and mechanical harvesting. The load carriers are also divided into two types: manual and mechanical loading tools. Mechanical loading transporting equipment are using sugarcane loaders. LITERATURE REVIEW Botanical and Sugar Cane Cultivation (Saccharum officinarum Linn) According to Leovici (2012), sugar cane was a plant originating from India. A lot of literatures mention sugarcane came from Polynesia. According to Nikolai Ivanovich Vavilov, a Soviet botanist who had made expeditions in 1887-1942 to several regions of Asia, Europe, Africa, South America, and the entire Soviet Union, ensured the origin of this plant were from India and Indo Malaya. Sugarcane plants have similar morphology with from grass families. This plant is 2-5 meters tall. Sugarcane is a family of grasses (graminae). The roots of sugarcane include a fiber root with one meter long. The main function of the root is to absorb water and minerals from the soil through the surface of the root feather that has a very strong water or nutrient absorption. The ability of form seedlings and numbers of stems are the characteristics of each variety. Numerous saplings that reflect the number of stems per hectare of land are influenced by sunlight, temperature, nutrition, humidity, and spacing. Among these factors, irradiation becomes the most reliable factors causing the multiplication of tillers. Sugarcane plant (Saccharum officinarum) has benefits as raw material of sugar and vetsin. The age of sugar cane plants can reach 1 year. Cane plant can be used for refined sugar products, food or drink sweetening. Cane bagasse can be used for animal feed and composts and green manure. Dry cane leaves have high calories and can be used as fuel for cooking. They are cheaper than kerosene or gas. In the sugar factory, dried cane leaves can be used for production processes and power plants (Fitriani, 2013). Role of Management and Management Functions "Management is the attainment of organizational goals in an effective and efficient way through planning organizing leading and controlling organizational resources" (Daft, 2003). Management concerns the achievement of goals effectively and efficiently through planning, organizing, directing and controlling. Planning has a sense of determining goals for future organizational performance as well as deciding the tasks and resources necessary to achieve those goals. Lack of poor planning or planning can destroy organizational performance. In its own agribusiness, planning consists of product planning, business location planning. Product planning includes the selection of product types and numbers of products to produce. Business

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location planning is the selection of business location that can give benefits to business in the future. Environmental conditions, sources of materials, and markets are factors to consider in selecting locations (Team of writers PS, 2008). Cutting-Loading-Transporting Management (TMA) A cutting-loading-transporting activity is one of the most important tasks in sugar mills. This activity prioritizes the accuracy in planning and carrying out a series of harvest cultivation and process to obtain maximum results of raw materials for sugar. The duties and responsibilities of cutting-loading and transporting are to harvest to obtain the highest quality of sugar and provide the demands for raw materials to mill according to the capacity of the factory continuously and accommodate the interest of Tebu Sendiri (TS) and Tebu Rakyat (TR). Cutting-loading-transporting management consists of four functions: planning, organizing, implementing, and supervising. Planning is a formulation of the issues of what and how a work will be carried out, including preparation for administrative measures. Organizing is an action that focuses on job distributions, including their types and functions that skillful people do. Organizing divides large activities into smaller ones. The implementation is divided into three parts: leadership, direction, and coordination (Sulaiman, 2015). The sugar cuttingloading-transporting system includes cutting, loading, transporting, and discipline queuing. Many factors influence cutting-loading-transporting system in a sugar factory. Commonly used systems are manual, mechanical and/or semi-mechanical systems. Particularly selected cuttingloading-transporting system will affect the productivity and overall rates of plant efficiency. The yield of produced sugar may increase. The analysis of cutting-loading-transporting system is done by observing the process in sugar factory. Observations are made by following the process flow: from cutting, loading sugar cane to conveyance, transporting sugarcane from the garden to the factory, and conducting queuing system in the cane yard. Sugarcane Loader Harvesting sugar cane can be done in several ways: (1) green cane harvesting (green cane), and (2) harvesting of burnt cane. Based on the main source of energy used, harvesting of sugar cane can be done in two ways: (1) harvesting of sugarcane manually, and (2) mechanical harvesting of sugar cane. Harvesting of green cane is directly done without any other treatment before it is harvested. Harvesting of burned sugar cane is done after sugar cane plant is burned to clean the sugarcane leaf waste. Manual harvesting is done in two ways: loose cane, and cane bundle. The yields using a loose cane method are in the form of loose sugarcane and loaded into vehicles via sugarcane loader. The harvest using a bundle cane-shaped method is in the form of bound formed cane and loaded into the vehicles using human power. Mechanical harvesting method is a way of harvesting using machine. These tools are more effective and efficient than the manual. A lot of tools belong to mechanical method, one of which is a sugarcane loader. A sugarcane loader is a mechanization tool for lifting and collecting pieces of sugarcane that have been harvested. This tool is considered more effective because it saves the harvest time. Sugarcane loader HY9600 is used in this research. The sugarcane loader of this type weighs 9,600 kg, and the weight of the sugar cane reaches 1,200 kg, making it easier for the farmer to load sugarcane after being harvested.

RESEARCH METHODS This research used a descriptive qualitative method with in depth interview serving as data collection method. The primary data were directly obtained from key informants. This research was conducted at PG Djatiroto, Lumajang. The choice of this location was due to the

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fact that PG Djatiroto, Lumajang was known as a high productivity sugar cane factory. PG Djatiroto, Lumajang has used sugarcane loaders for a quite long time. The area of PG Djatiroto covers the land of 5,450,414 Ha. PG Djatiroto becomes a sugar cane production center for Lumajang and surrounding areas. The samples were purposively selected. The research time was carried out in May 2016. Data were in the form of numbers, information or anything trustworthy which later would be used for drawing conclusions (Siregar, 2014: 37). Data were classified into primary and secondary data. Primary data were directly collected from the main source of research. While secondary data consisted of published data and those belonging to the main source. There were two research data: qualitative and quantitative. Qualitative data are data in the form of opinions or statements in the form of words or sentences. Quantitative data were in the form of numbers that would be processed using statistical analysis. Interviews, observations and documentation were data collection (using tape recorders) techniques of this present study. The key informants as the source of data especially the employees of PG Djatiroto were selected on the basis of their expertise: experience, abilities to master agricultural tools including sugarcane loader and mastery of understanding of freight cutting methods. The samples for this study involved 4 people who were considered capable of understanding the whole process of a sugar cane harvesting technique. RESULTS AND DISCUSSIONS There were two types of cutting patterns in PG Djatiroto that is, TAS and TAPG. TAS was a self-cutting-transporting method commonly done by farmers. TAPG is a factory-cuttingtransporting method sugar factory haulage. Both methods were equally employed, 50% and 50%, to meet the demands for raw materials to mill at PG Djatiroto. In TAPG, the factory took the whole responsibilities from the harvest sites to milling spots at factory. The authority varied from seeking manpower to cut the sugar cane plants from finding vehicles to load and transport the harvests. These findings were similar to the study by Bantacut (2012): to meet the demands for milling capacity not only using TS but also using TR. The cutting-loading-transporting methods were the combination of TAS and TAPG. The TAS system was with a written agreement between farmers and PG management in accordance with milling seasons. The factory did not bind the agreement with the farmers. Instead, the factory provided counseling and training, and conduct a comparative study to farmers who owned sugar cane fields. These strategies were intended to ensure the supplies for sugar cane from farmers were in a good quality so that they could be further processed in the mills. There were 2 types of cutting-loading-transporting methods: manual and semi mechanized method by using a sugarcane loader. In the manual, it was the people who took care for cutting, loading and transporting activities. In reality, this method had some limitations, one of which was instability of man power in transporting the sugar canes. The same was also true when people began cutting down the plants. Man power was also influenced by climate factors. In a semi-mechanically system, such a work was shared by people and machines. Sugarcane loaders were machines people used to load and transport the harvest. Sugarcane loaders had a variety of benefits such as economic, technical, and community empowerment benefits. Economic benefits were hardly found by the company during normal seasons. However, in extraordinary seasons (Muslim Festival days) where it was hard to find people to cut, even if any the factory would pay two or three times higher than a normal wage, economic benefits could be easily identified. Nowadays Djatiroto sugar cane factory has used sugarcane loaders in spite of high operational costs. The effectiveness of sugarcane was only 60-80 tons. This made operational costs of sugarcane loaders higher than those of manual cutting. The system was another factor that made the operational cost high. In practice, sugarcane loaders need much more fuel than trucks for mobility. The cost PG Djatiroto spent to pay people for their cutting service was

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around 5,600 per kWintal. They had to spend another extra cost of 9,000, if they hired people to load sugarcanes. It was predicted that the use of sugarcane loaders at Djatiroto would be effective in 4-5 years to come when they would no more employee people to cut the sugar cane plants. Next generations were unlikely to work as sugar cane cutters. Semi-mechanization alternative would be a good solution in the future. Infrastructure and systems needed to be improved. In so doing, there would be no errors in operating semi-mechanical cutting-loading-transporting systems. In the future, the sugarcane loader tool can also press the HPP. If manual cutting power decreased in number then the required wage would be increasing and exceeding the cost of the sugarcane loader itself (01/ES/VI/30-34). The technical benefits of using sugarcane loader promoted the productivity of the sugarcane loaders. The productivity of the sugarcane loader was to carry 5 quintals of sugar cane in one transport. Meanwhile, with a manual method, people could cut plants as wide as 80,000 ha to 90,000 ha or 9,000 tons. This work involved 4,000 to 5,000 workers. One person with one working day time could harvest 10-15 quintals. A manual method could supply sugar cane for 24 hours in 1 mill season. The benefit of sugarcane loader for community empowerment was that to increase their income. Sugarcane loader was effective during the sugarcane harvest period. People no longer needed to transport into vehicles. When using these tools, people could increase their income by working on the clearing of sugar cane in a larger area. Therefore, with a sugarcane loader the community can increase their income by working on the cutting of sugar cane with larger land, due to the fatigue factor. Farmers were required to move from one land to another when working with sugar cane plats. The cost for cutting down was Rp5,600 per cutting-loading work. If transport cost was removed and farmers cut down the cane in a larger area, this would increase their income. For transporting the sugar cane, people can use sugarcane loaders which could go faster than men. This condition would benefit PG Djatiroto because the capacity supply of the mill was quickly fulfilled. Nevertheless, female and male farmers had different opinions about sugarcane loaders. Female famers favored these tools for they were unable to lift sugarcane into vehicles. They preferred to work in a wider area but only cutting down the pants. The numbers of people who took care for cutting-loading work in PG Djatiroto were about 3,500. They were from various regions such as Lumajang, Jember, Banyuwangi, Probolinggo, and Madura. Cutting farmers from coastal areas such as Madura were considered to have better performance than those from other regions. Working hours of sugarcane farmers in PG Djatiroto during the milling season was from 7 am to 4 pm. From 7 o'clock to 9 o'clock was rated as peak performance, and at 10 o'clock the performance of the farmers was decreasing. Cutting-loading work haul hauling was reported and monitored via Whatsapp. The plant manager would ask the head of the plants along with their assistants if they could get appropriate capacities of sugar canes to send to the factory. If not, the plant manager would directly tell the general manager GM to do other plans to achieve the targets. Planning, organizing, implementing, controlling system at PG Djatiroto during the cutting milled season has been arranged well. For planning is set at RKAP which is made every year, while for organizing done from General manager to assistant of garden, from each level have responsibility respectively. While the implementation carried out by sugar cane farmers through the supervision of the assistant garden. Monitoring was done through Whatsapp involving the general manager, plant manager, and garden assistant. The general manager checked the supplies every hour by asking how much sugarcane were ready to be sent. If the ready-to-pressed cane has not reached the company's target, the plant manager would coordinate with the general manager. The general manager then made decision to solve the problems. Managerial implications included planning, organizing, implementing, controlling during the milling season in PG Djatiroto. Planning at PG Djatiroto

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has been listed in the annual RKAP. RKAP has been discussed: how many targets to harvest, how much capital is needed, how much labor is required. Organizing included duties and responsibilities PG Djatiroto put into consideration. It was Mr. Narwanto who had responsibility for cutting loading activities and transport sugar canes to mill. The evaluation was conducted about the target of sugar cane capacities, involving numbers of people such as the General Manager, plant manager, and garden assistants. Conclusion Based on the results of the study, the following conclusions are drawn. The economic benefits of sugarcane loader is hardly found. The reason is because the prevailing system is not running optimally: the cost of sugarcane loader is still much more expensive than that of manual loading power. The cost of using manual labor is Rp5,600/quintal. The cost of sugarcane loader reaches Rp6,000/quintal to load into vehicles. The technical benefits of sugarcane loader is relatively feasible because the achievement of sugarcane loader work reaches 80 tons/day. Meanwhile, manual cutting power reaches 10-15 quintals/day. The loading-transporting ratio is much larger than that of the manual. The benefits of using sugarcane loader for community empowerment have not been fully obtained. This is due to the resistance of the community. Male cutting farmers prefer not to use sugarcane loaders and choose to cut and haul in one area. Female cutting farmers prefer to use sugarcane loader, and they prefer to cut more in a larger area in order to increase their incomes. Sugarcane loaders should also go to areas with less population density or community with less agricultural subsistence. The effectiveness sugarcane loader is still not very effective compared to using manual loading power. Due to the system of sugarcane usage is still not perfect. As a result, the cost incurred is more expensive than that of the manual. Potential sugarcane loader itself is very good if applied with adequate systems and appropriate lands. REFERENCES Abidin, Z. (2000). ‘Dampak Liberalisasi Perdagangan terhadap Keragaman Industri Gula Indonesia: Suatu Analisis Kebijakan’. Disertasi Doktor, Bogor: Institut Teknologi Bogor Badan pusat statistik. Produksi Perkebunan Besar Menurut Jenis Tanaman, Indonesia, 19952014. www.bps.go.id Badan pusat statistik. Luas Tanaman Perkebunan Besar Menurut Jenis Tanaman Indonesia, 1995-2014. www.bps.go.id Bantacut Tajuddin, et al. (2012). ‘Kehilangan Gula Dalam Sistem Tebang Muat Angkut di Pabrik Gula Sindang Laut Dan Tersana Baru, Cirebon. Jurnal Teknologi Pertanian. Vol. 13 No. 3: 199-206 Daft, L. (2003). Pengantar Manajemen. Jakarta: Salemba Empat. Daft, L. (2007). Pengantar Manajemen. Jakarta: Salemba Empat. Ditjen Industri Agro dan Kimia. (2009). www.agro.kemeperin.go.id Driyanto Aris, et al. (2012). ‘Pengaruh varietas, potongan tebu, penundaan giling terhadap nira tebu’. Jurnal Agrointek. Vol 6, no. 2 Agustus 2012. Fauzantoro, et al. (2013). Si Manis Beribu Manfaat. http://www.biotek.bppt.go.id/index.php/artikel-sains/122-si-manis-beribumanfaat. Firdaus. (2010). Manajemen Agribisnis. Jakarta: Bumi Aksara. Fitriani, et al. (2013). ‘Faktor-Faktor yang Mempengaruhi Produksi, Curahan Kerja dan Konsumsi Petani Tebu Rakyat di Propinsi Lampung’. Ilmiah ESAI, 7(1): 1978-6034 Girei dan Giroh. (2012). ‘Analysisof the Factors Affecting Sugarcane Production under the Out GrowersScheme in Numan Local Government Area Adamawa State, Nigeria’.

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Journal of Education and Practice. ISSN 2222-1735 (Paper) ISSN 2222-288X (Online) Vol 3, No.8, 2012. Haposan, et al. (2012) ‘Analisis Perbandingan Pendapatan Program Kemitraan PT Perkebunan Nusantara II dengan petani tebu rakyat intensifikasi. Journal on Social Economic of Agriculture and Agribusiness, vol. 1 No.1,pp. 1-14 Herdiansyah, H. (2010). Metode Penelitian Kualitatif Untuk Ilmu-Ilmu Sosial. Jakarta: Salemba Humanika. Indrawanto, et al. (2010). Budidaya dan Pasca Panen Tebu. Jakarta: ESKA Media. Kurniasari, et al. (2015). ‘Permintaan Gula Kristal Mentah Indonesia’. Jurnal Ilmu Pertanian Vol. 18 No.1, 2015 : 24-30 Leovici. Helena. (2012). ‘Pemanfaatan Blotong Pada Budidaya Tebu (Saccharum officinarum L.) Di Lahan Kering’. Yogyakarta : Universitas Gajah Mada. Mareta, et al. (2011). Pengemasan Produk Sayuran Dengan Bahan Kemas Plastik Pada Penyimpanan Suhu Ruang Dan Suhu Dingin. Mediagro,7 (1) : 1-15. Moleong, L. J. (2010). Metodologi Penelitian Kualitatif. Bandung: Remaja Rosdakarya. Sanusi. (2011). Metodologi Penelitian Bisnis. Jakarta: Salemba Empat. Soetriono, et al. (2006). Pengantar Ilmu Pertanian. Jember: Bayu Media Sugiyono. 2014. Metode Penelitian Kuantitatif, Kualitatif dan R&D. Bandung: Alfabeta. Syafriandi. (2012). ‘Analisis Kecepatan Maju Traktor dan Putaran Pisau Pemotong Pada Pengeprasan Tebu Ratoon’. Rona Teknik Pertanian. Vol. 5(2): 373. Wayan, et al. (2014). Pengaruh Faktor Internal dan Eksternal terhadap Pendapatan Petani Tebu di Ngimbang, Lamongan. Surabaya.: Universitas Ciputra Wayan, Sinaga. (2011). 'Pengembangan Industri Gula Indonesia yang Kompetitif pada Situasi Persaingan yang Adil’. Lembaga Riset Perkebunan Indonesia. Institut Pertanian Bogor

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POSITIONING STRATEGY OF SERVICE PRODUCT AT "XYZ" COMPANY IN EAST JAVA Amelia Tedjabhawa, 2David Sukardi Kodrat♠

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Ciputra University Surabaya INDONESIA Email:

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[email protected],[email protected]

ABSTRACT Bookkeeping is part of accounting where accounting is important in a business, as well as taxation. Both are not always understood by businessmen. These conditions generate business service of accounting and taxation. And this business has a great potential to be developed, especially in East Java. The competition in this business is quite a lot, either with similar companies or with internal accountants. Any given product services is not that different from other business services because there are standard regulations to be complied. "XYZ" Company has no proper positioning strategy to cope with the on-going competition. Based on the background described, the researcher was interested in making thorough research on this, entitled "Positioning Strategy of Service Product at "XYZ" Company in East Java". This research is a descriptive qualitative research. The method of data collection was performed through interviews and the distribution of questionnaires to the informants. Informants who became the sample had been determined by the method of non-probability sampling with purposive technique. This research aims to determine how the positioning strategy of service product at "XYZ" Company in East Java works. This research emphasizes the explanation of the steps of positioning strategy at "XYZ" Company. The steps were using several management tools, such as analysis of CPM (Competitive Profile Matrix), analysis of multi-attribute model of Fishbein, analytical ranking of the uniqueness of the product, and the calculation of T-Score. Positioning strategy in this research was preceded by segmenting and targeting which resulted in positioning statement. This positioning statement generated some managerial implications, including its effect on differentiation and the brand of "XYZ" Company. Keywords: Positioning Strategy, Services, Accounting, Tax

INTRODUCTION Bookkeeping is part of accounting where accounting is important in a business, as well as taxation. Both are not always understood by businessmen. These conditions generate the business service of accounting and taxation. This business has a great potential to be developed, especially in East Java. East Java or locally called Jawa Timur is a province in eastern part of Java (or Jawa) Island with Surabaya as its capital (Wikipedia, 2016). The number of registered taxpayer in Jawa Timur in

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2012 is 3.2 million. This amount is significant enough as it contributes 13% to the total of registered taxpayers all over Indonesia. In Jawa Timur, the number of enterprise taxpayer is 2.9 million and the individual taxpayer is 300,000 while the number of taxpayer growth is about 10 15% per year (Direktorat Jenderal Pajak, 2013). In 2015, Jawa Timur has reached the second highest of economic growth, after DKI Jakarta, in Java Island. Jawa Timur has reached 0.65 poin higher than national economic growth. Jawa Timur was also able to contribute 14,36% to national contribution. The economic growth of Jawa Timur can be seen in this Table 1 below: Table 1. Economic Growth

Resource: Badan Perencanaan Pembangunan Daerah, 2016. The points mentioned above show a great opportunity for the development of accounting and taxation business. On the other hand, this business is quite competitive either with similar companies or with internal accountants. Any given product services is not that different from other business services because there are standard regulations to be complied. Consulting institutions should have their own positioning strategy, as no exception to “XYZ” Company. But, "XYZ" Company has no proper positioning strategy to cope with the competition. Based on the background described, the researcher recommended positioning strategy to be applied in this company. LITERATURE REVIEW Previous Research First of all, an article in the journal entitled "Competing Strategy Formulation of Instant Ginger Products at CV. Intrafood Surakarta Using Perceptual Mapping", by Harisudin, et al. (2013), formerly determined product attributes and its performance then conducted analysis of position

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and competing strategy as well as perceptual mapping analysis. The researcher found the points of data analysis based on the interview result with key informant and drew the conclusion from the consumers’ perspective, the most favorable attribute of instant ginger products produced by CV. Intrafood is the benefit of the product compared to its competitors. While the least favorable attribute is the quality of packaging and its product performance. To win this competition, recommended strategies needed to be taken which are to expose the attribute of its benefit and improve the quality of the product as well as the design of the package. The use of this thesis is about how to define product attributes. Secondly, an article in the journal "Emerging Market Firms: Measuring Their Success with Strategic Positioning Map" (Kumar Singal and Kumar Jain, 2014) using documentary studies ET500 and Forbes Global 2000. This journal discusses positioning strategy and variables that influence it. Positioning strategy in this study was divided into 3 points: expanding international presence, increasing market capitalization (in terms of sales, profit, and ROA), and making movement that increases the company's presence and market capitalization. The variable that mostly influence in positioning is the size of the company, growth, and attractiveness. Those variables are used in the data analysis in this research. Thirdly, an article in the journal of Crick and Chaudhry (2000) entitled "UK SMEs' Awareness, Use, and Perceptions of Selected Government Export Assistance - An Investigation into The Effect of Ethnicity", discusses how awareness, usefulness, and perceptions of ethnicity on export assistance from UK government. The research method of this journal was by in-depth interview to 34 Managers with Asian ethnic background. The findings in this study show the existence of variance in behavior and perceptions of export assistance from UK government. Statistical analysis shows that two of the three sub-hypotheses can be rejected in this study and conclude that there are differences in behavior and perceptions of Asian and Local ethnic to UK government export assistance. The using in this thesis is about perceptual measurement. Fourthly, an article in the journal entitled "Positions and Positioning: Strategy Simply Stated" (McKechnie, et al., 2008). This journal uses document analysis and Simply Constructed Matrix. This journal discusses how to implement positioning strategy in the company according to their position. The research was performed to four airlines in United Arab Emirates (UAE). Researchers determined positioning of company by doing SWOT and simple analysis Constructed matrix. It was assessing the focus of the company and firming constraints to enter the market. This journal point used is about the company's focus according to its position. Last of all, an article in the journal entitled "Slank Positioning Strategy in Embedding Image as One of Group Band in Indonesia" (Reagan and Rosilawati, 2009). This journal uses documentation study and interview, which discusses the positioning strategy of Slank. The purpose of Slank positioning is to distinguish or provide a unique value for Slank than other bands that exist. The positioning strategy in this study was using tagline. Thus, tagline is taken for this thesis. Service Product Definition of service according to Lovelock et al. (2011: 16) is an economic activity offered by a party to another party, within a certain period of time, in the form of activities that bring the desired results to the recipient. The desired result is not about ownership, but the value. According to Yazid (2008) in Hidayat (2012), characteristics of services are intangible, heterogeneous, inseparable, and imperishable. There are three types of interactions between service providers and consumers, related to the location according to Lupiyoadi (2009) in Hidayat (2012): 1. Consumer comes to the service provider.

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2. Service provider comes to consumer. 3. Business services transactions are conducted through other companies. Positioning Strategy The concept of strategy has long existed. According to Thompson and Strickland in Reagan and Rosilawati (2009), strategy is a combination of planning and adaptive action. While according to Schemerhorn (1999) in Reagan and Rosilawati (2009), strategy is a comprehensive planning activity that defines the instructions and critical direction on the allocation of resources to achieve the organization's long-term goals. Positioning according to Al Ries and Jack Trout in Kartajaya, et al. (2005: 56) is to place products and brands on customer's mind. The marketing war is not placed in the market, but in the mind of customer. Positioning according to Philip Kotler in Kartajaya, et al. (2005) is every effort to design products and brands to occupy unique position in the mind of customer, so that it can creates a value proposition that fits customer’s reason to purchase. Based on the opinion of some experts above, it can be concluded that positioning strategy is a combination of plans and actions of product and brand placement on customer's mind collaboratively with instruction and critical direction to the allocation of resources which at last aims on the right value proposition which becomes customer’s reason to purchase. According to Kasali (2005: 527-538), the definition of positioning pays attention to several things as mentioned below: 1. 2. 3. 4. 5. 6. 7.

Positioning is a communication strategy. Positioning is dynamic. Positioning related to event marketing. Positioning relates to product attributes. Positioning should give meaning to consumers. The selected attribute must be unique. Positioning should be disclosed in a statement.

Positioning statements must be made correctly so it can be saved in consumer’s nudes memory. Positioning should be built more than a slogan, can be preserved for a long periods of time, and deliver consumers to go through the AIDA process (Attention, Interest, Desired, and Action), so that the consumers can still remember the slogan, eventhough the promotional budget is tighten. Positioning Strategy of Service Product The positioning strategy aims to: 1. 2. 3. 4. 5.

Strengthen its own position. Seek and seize new positions. De-position. Re-position. Product ladder.

The preparation of product service positioning according to Kartajaya, et al. (2005: 81-85) pays attention to service quality dimension (SERVQUAL), namely: Tangibility, Empathy, Reliability, Assurance, and Responsiveness. Myers (Kasali, 2005) introduced three simple positioning techniques, described as follows: 1. Positioning Based on Product Profile. This technique is performed by highlighting the attributes that are considered as the most prominent points of the product in consumers’ perspective. The weakness of this approach is

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the obscurity to judge whether the attribute that are considered as the most prominent by consumers is valued as an important attribute or not. 2. Quadrant Analysis. Quadrant analysis places the importance of attributes according to the consumer and compares it to brand / product achievements by consumers. 3. Rating The uniqueness of Product. This approach links the uniqueness of the product with its importance. These ratings are displayed in a graph. Vertical line represents the importance of product attributes. Horizontal line represents uniqueness of product attributes. Attributes that occupy the dots on the right top is selected as a highlighted attribute in positioning.

RESEARCH METHODS This research is a descriptive qualitative research. According to Moleong (2010: 6), qualitative research is research that intends to understand the phenomenon of what is experienced by the subject of research holistically, by description in words and language in a particular context that is natural and utilizing various natural methods as well. While, according Herdiansyah (2011: 9), qualitative research is a scientific research aimed to understand a phenomenon in social context naturally by giving priority to the process of deep communication interaction between researchers and the investigated phenomenon. This research aimed to determine how the positioning strategy of service product at "XYZ" Company in East Java works. The research was performed from May to August 2016. The method of data collection was conducted through interviews and the distribution of questionnaires to the informants. Informants who became the sample were determined by the method of non-probability sampling with purposive technique. This research uses two types of data resources; they are primary and secondary data. This research emphasizes the explanation of the steps of positioning strategy at "XYZ" Company. Positioning strategy was preceded by segmenting and targeting. The steps of positioning strategy were using several management tools, such as analysis of CPM (Competitive Profile Matrix), analysis of multi-attribute model of Fishbein, analytical ranking of the uniqueness of the product, and the calculation of T-Score. Positioning strategy in this research was preceded by segmenting and targeting which resulted in positioning statement. The positioning statement generated some managerial implications, including its effect on differentiation and brand of "XYZ" Company.

RESULT & DISCUSSION The positioning strategy was preceded by segmenting and targeting. In segmenting, there were three phases of procedure done. According to Purnama (2004), they are namely: a. Survey Phase. At this phase, the interview was performed via Whatsapp messenger with ten clients of the "XYZ" Company and ten clients of others (non "XYZ" Company) on the topic concerning the consideration in choosing consulting institution and what a good consultant is on their minds. b. Analysis Phase. Based on the results of the interview, there were thirteen attributes to look for in positioning of service product at “XYZ” Company, namely: competence, professionalism, integrity, independence, credibility, reliability, responsiveness, and location, price/fee and consultant’s

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assurance (guarantee for client’s confidentiality), empathy connection/relationship with clients, and size of client’s company. c. Formation Phase.

towards

clients,

Analysis Phase shows the two most significant attributes out of 13 attributes mentioned by the informants, as they are the competence of the consultant institution and connections/relationship with clients. Researcher then prepared segmentation based on both attributes. Competence according to Spencer and Spencer in Dharma (2010) is divided into the main competence and differentiation competence. Connections/relationship with client according to Ford in Wahyono (2013) consists of interaction customer relationship (relationship begins from first contact), coordinating activities (relationship requires coordination from both side), and adaptations (relationship creates a shared satisfaction). Classification segment based on both of those attributes delivers 6 market segments, namely: 1. AA Segment, i.e. all new community which are served by basic competence then they should cooperate with “XYZ” Company. 2. BB Segment, i.e. clients with contract period less than 1 year, which are served by basic competence then they should perform furthermore coordinating activities with “XYZ” Company. 3. CC Segment, i.e. clients with contract period more than 1 year, which are served by basic competence then they should create a shared satisfaction with "XYZ" Company. 4. DD Segment, i.e. all new communities which are served by differentiation competence then they should cooperate with “XYZ” Company. 5. EE Segment, i.e. clients with contract period less than 1 year, which are served by differentiation competence then they should perform furthermore coordinating activities with “XYZ” Company. 6. FF Segment, i.e. clients with contract period more than 1 year, which are served by differentiation competence then they should create a shared satisfaction with "XYZ" Company. After segmenting them, the researcher performed targeting step, by using the selected segment namely DD, EE, FF. Those segments are in accordance with the criteria of size, growth, and attractiveness. The last step was to prepare the positioning strategy. According to Walker (2008), the strategy of positioning can be done with the 7 steps, as they are: a. Identifying the competitors Researcher chose “Reksatama” Company as a competitor for “XYZ” Company. According to Widodo in Harisudin (2011), identification of competitor is performed by analysis of CPM (Competitive Profile Matrix). Based on the results of the analysis of CPM, “XYZ” Company is superior compared to "Reksatama" Company especially in terms of competence, professionalism, integrity, credibility, reliability, responsiveness, assurance/ warranty of confidentiality, empathy, and connection/ relationship with client. b. Identifying the most favorable attributes Identification attribute using the Fishbein model (Suryani, 2008), is valuing belief and evaluation, i.e. informant assessment against the "XYZ" Company and "Reksatama" Company before and after the alliance contract. This analysis also produces higher value for the “XYZ” Company, especially in terms of professionalism, competence, connection/relationship with clients, integrity, credibility, reliability, responsiveness, assurance/warranty of confidentiality, empathy, independence, and price/fee. c. Collecting information from consumers to know their perception. The perception of informants is determined by using the T-Score (Rahmadyanti, 2013). By using T-Score analysis, positive and negative perceptions are indicated. Based on the results

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of the analysis, the positive perceptions of “XYZ" informants are assurance/warranty of confidentiality, connection/relationship with clients, competence, integrity, empathy, professionalism, credibility of institution, and price/ fee. d. Analyzing the strength of the positioning of the product. Analysis of the strength of the position of the products was carried out by ranking the uniqueness of the products, according Kasali’s theory (2005). The most important and unique attribute based on this analysis are competence, connection/relationship with clients, and professionalism. e. Determining the combination of consumer choice. Based on top 3 of informants’s choices on CPM analysis, multiple attribute analysis (Fishbein model), measurement of perception with a T-Score, and ranking the uniqueness of the product, combination of attributes that are appropriate for positioning statement are competence and connection. Both attributes should be considered as value proposition by "XYZ" Company in preparing the positioning statement.

f.

Considering consumer choice and segment attractiveness.

Attributes of consumer choice are in line with the result of the segmentation at the phase of the formation, which forms the market segment based on the attributes of competence and connections, with target market DD, EE, and FF segment. g. Determining positioning statements which contains value proposition. According to Walker (2008), value proposition consists of benefit, target market, and price offered. Based on these propositions, researcher made four positioning statements which were considered by the informants. Positioning statement that was chosen is: "XYZ" Company - Best Partner. High competence.”

CONCLUSION Researcher has performed steps to deliver positioning statement that is appropriate with “XYZ” Company. The strategy of positioning was preceded by segmenting and targeting. Based on the results of the research analysis, positioning statement that was chosen is: "XYZ" Company - Best Partner. High competence.” There are some managerial implications of that as follows: a. The purpose of this research on the positioning strategy were seeking and seizing new position. “XYZ” Company has 6 market segmentations, whose target markets are DD, EE, FF segment, and positioning statement: “XYZ" Company - Best Partner. High competence. b. “XYZ” Company has several steps of fixing and quality enhancement in accordance with the results of the research. c. Positioning statement should be maintained in a long period and make the consumer capable of going through the process of AIDA (Action, Interest, Desired, and Action). d. Positioning result of "XYZ" Company is the first step of brand identifying in determining the differentiation. Differentiation of service product of "XYZ" Company is to provide the best service to every customer through: 1. Service with longer working hours to the client, i.e. at 7 am – 10 pm. Service is provided with a full commitment to help clients find solutions for their problems and improve the effectiveness and efficiency of their business performance.

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2. The use of Team Viewer application which is remote software for controlling desktop computer via internet, in purpose to overcome the problems of clients without the need to go to their office and can be done at anytime. 3. Empowerment of good human resources in every engagement and consistent effort to maintain the quality of its human resources. e. The differentiation made by the “XYZ” Company is a step to create brand awareness in market, which finally will establish a brand identity for the “XYZ” Company. The brand is represented by elements of the visible and the invisible. All of these elements must cooperate consistently and continuously to communicate the promise embedded on "XYZ" brand, form a wide perception of "XYZ" brand, and fulfill the expectations over brand "XYZ".

REFERENCES Badan Perencanaan Pembangunan Daerah. (2016). ‘Dinamis 1 2016’. http://bappeda. jatimprov.go.id/bappeda/wp-content/uploads/2015/09/dinamis_sem_1_2015.pdf (accesed on Mei 3, 2016). Crick, D., & Chaudhry, S. (2000). ‘UK SMEs' Awareness, Use, and Perceptions of Selected Government Export Assistance - An Investigation into The Effect of Ethnicity’. International Journal of Entrepreneurial Behavior & Research, 6(2), 72-89. Dharma, Surya. (2010). Manajemen Kinerja: Falsafah Teori dan Penerapannya. Yogyakarta: Pustaka Pelajar. Direktorat Jenderal Pajak. (2013). ‘Konsultan Pajak Harus Berkontribusi Meningkatkan Kepatuhan Wajib Pajak’. http://www.pajak.go.id/content/ news/konsultan-pajak-harusberkontribusi-meningkatkan-kepatuhan- wajib-pajak (accesed on Mei 3, 2016). Harisudin, M., et al. (2013). ‘Perumusan Strategi Bersaing Jahe Instan Produk CV. Intrafood Surakarta Menggunakan Perceptual Mapping’. Jurnal Agriekonomika,2 (2), 86-95. Herdiansyah, H. (2011). Metodologi Penelitian Kualitatif untuk Ilmu-Ilmu Sosial. Cetakan Kedua. Jakarta: Salemba Humanika. Hidayat, Nanang Choirul. (2012). ‘Strategi Memasarkan Produk Jasa’. Jurnal Progressif 9 (25), 112 - 140. Kartajaya, et al. (2005). Memenangkan Persaingan dengan Segitiga Positioning DiferensiasiBrand. Cetakan Keempat. Jakarta: PT Gramedia Pustaka Utama. Kasali,R. (2005). Membidik Pasar Indonesia. Segmentasi, Targeting dan Positioning. Cetakan Ketujuh. Jakarta: PT Gramedia Pustaka Utama. 84 Kumar Singal, A., & Kumar Jain, A. (2014). ‘Emerging Market Firms: Measuring Their Success with Strategic Positioning Maps’. Journal of Business Strategy, 35(1), 20-28. Lovelock, C., Wirtz, J., & Mussry, J. (2011). Pemasaran Jasa (Manusia, Teknologi, Strategi Perspektif Indonesia) (Edisi 7 Jilid 1). Jakarta: Erlangga.

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McKechnie, D. S., et al. (2008). ‘Positions and Positioning: Strategy Simply Stated’. Business Strategy Series, 9(5), 224-230. Moleong, L. J. (2010). Metodologi Penelitian. Cetakan Keduapuluh Delapan. Bandung: PT Remaja Rosdakarya. Purnama, L. (2004). Strategic Marketing Plan. Cetakan Ketiga. Jakarta: Gramedia. Rahmadyanti, Puspita Ayu. (2013). Sikap dan Perilaku Konsumen terhadap Produk Olahan Durian. Skripsi tidak diterbitkan. Medan: Universitas Sumatera Utara. Reagan, M. R., & Rosilawati, Y. (2009). ‘Strategi Positioning Slank dalam Menanamkan Citra sebagai Salah Satu Grup Band di Indonesia’. Jurnal Ilmu Komunikasi, 6 (1), 87 -118. Wahyono, Budi. (2013). ‘Pengertian Relationship Marketing (Pemasaran Relasional)’. http://www.pendidikanekonomi.com/2013/02/pengertian-relationship-marketing.html (accesed on September 23, 2016). Walker, O. C., et al. (2008). Marketing Strategy: A Decision-Focused Approach. Edition 6. McGraw-Hill International Edition. Wikipedia. (2016). ‘Jawa Timur’. https://id.wikipedia.org/wiki/Jawa_Timur (accesed on Mei 3, 2016).

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MARKETING MIX ANALYSIS ON DECISION MAKING TO STUDY IN THE CONTINUING HIGHER EDUCATION (STUDIES IN STIKES ANWAR MEDIKA HOSPITAL SIDOARJO) Farida Anwari, 2Hermeindito♠

1

Ciputra University Surabaya

INDONESIA E-mail: [email protected]

ABSTRACT National education as one way to prepare human resources in the future, must be planned carefully from primary, secondary to college. As UU No. 20 (3) of 2003 states that the national education serves to develop skills and character development and civilization of the nation's dignity in the context of the intellectual life of the nation. On the other hand the lack of the state budget for the education sector and the many enthusiasts cause to the limited opportunity to study in state universities. Besides competition among educational institutions are also growing rapidly. Market acceptance of the educational services provided by STIKES RS. Anwar Medika Sidoarjo good enough that can be said with a marked increase in the number of students in 2016. This requires an increase in management to better understand the influence of aspects of the marketing mix to the tendency of students choose STIKES RS. Anwar Medika as a place of study options. This study aims to determine the effect of aspects of the marketing mix of product, price, promotion, location, physical evidence, lecturer and staff, as well as the process of the student's decision to study at STIKES RS. Anwar Medika Sidoarjo. The method used is quantitative study sample as many as 57 students. Data collection techniques in this study conducted by distributing questionnaires using likert scale. Based on the analysis, it can be concluded that the product, price, location, promotion, and physical evidence has a significant influence on the selection decision STIKES RS. Anwar Medika, while lecturer and staff as well as the process does not significantly. Key Words: Product, price, promotion, location, physical evidence, lecturer and staff, process, study selection decisions INTRODUCTION Sustainability of national education is a state guarantee as stipulated in the 1945 Constitution article 31. Law number 20 Year 2003 Article 3 which states that national education serves to develop skills and character development and civilization of the nation's dignity in the context of educating the nation must be addressed properly by the education providers to achieve these objectives.

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In conducting its role as an educational institution, a university or high school must be properly managed in order to realize the educational goals that have been formulated with optimal especially to meet the needs of national education itself. The lack of state budget for the education sector and the many enthusiasts of state university cause not all Indonesian citizens have the opportunity to study in Universities. On the other hand, the need for continuing education at the college level is very important in order to improve people's lives. This opens up opportunities for the private sector to participate and help educating the nation through the establishment of private universities. Purwanto (2011), competition between institutions is an uncontested reality and lasted more strict. Competition no longer concerns the efficiency of education, but it has become a natural thing if educational institutions were selected that have an edge on almost all aspects of. On the other hand, marketing is one of the important factors to promote the quality of education and maintain market competition. According to Kotler and Armstrong (2013), marketing is defined as the process by which companies create value for customers and build strong relationships with consumers in order to acquire the value of the consumer in return. There are seven factors in the marketing mix for services, namely product, price, promoton, place, people, process and physical evidence which in practice will affect your decision in choosing educational institutions. As one of the educational institutions in Sidoarjo, STIKES RS. Anwar Medika can be said to have been growing rapidly, one of which is marked by the increasing number of students in 2016. The increase is demanding the management to better understand the influence of aspects of the marketing mix to the tendency of students choose STIKES RS. Anwar Medika Sidoarjo as the preferred place of study. LITERATURE REVIEW Past Research Yulfita'aini (2010) conducted a study with the aim to determine the effect of the decision hahasiswa Marketing Mix in continuing studies at university (Study at the University of Sand Pengaraian-Riau). This type of research is quantitative research. Based on testing using multiple linear regression anaisis, the overall marketing mix elements together significantly influence the student's decision to continue studies at the University of Sand Pengaraian. Partially, it was found that product, price, location, physical evidence and process a significant effect on student's decision, while promotion is not significant. Also concluded that the price has a dominant influence on the student's decision to continuing his studies. Ujang Muhyidin (2015), in the Proceedings of the National Seminar on Multi Disciplines & Call For Papers University Stikubank Semarang through research entitled "Effect of Educational Services Marketing Mix Decision Against Students Choosing Colleges in West Java". This type of research is quantitative research. By using multiple linear regression analysis, it was concluded that not all elements of the marketing mix has a significant impact on student's decision to choose a private college in West Java. Promotion, price and people are not significant. While the variables that significantly ie products, locations, processes and physical evidence. Tabita and Halim (2014) investigated the factors that influence high school students in choosing a college. This type of research is quantitative. Based on the analysis using PLS, concluded that

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academic factors, economic factors, process factors, factors promotional site factors, and factors of each professor's reputation significantly influence the electoral college in Surabaya. Marketing Mix Product The product is anything that can be offered to the market for attention, acquisition, use or consumption that might satisfy a desire or need. (Kotler and Armstrong, 2013). According to Kotler and Fox (1995), the products in the field of education was given another term that program. The program is the most basic decisions that must be made by educational institutions. The program of an educational institution showing the identity and position of the institution when compared with other educational institutions. Price Price is the amount of money that must be spent to get the product or service. More broadly, the price is the sum of all the value that consumers give to get the benefits of having or using the product or service. (Kotler and Armstrong, 2013). According Enache (2011), the price of education is tuition programs that are affected by the cost, demand and price competition. Location Location refers to the activity of the institution resulting products / services can be provided to the target consumers. (Kotler & Armstrong, 2013). Mustafa et al. (2014) measured on the aspect of the proximity of the school to the consumers (students). Location also affects the cost of which it is a significant factor in the process of choosing a university. It encourages students to consider choosing a university close to home (Priceet et al., 2003). Promotion Promotion is an activity that communicate the benefits of the product and persuade target consumers to buy them. (Kotler and Armstrong, 2013). Li and Hung (2009) measures the promotion of education that includes aspects of mission and vision, latest news, student achievement, parent-teacher meeting, exhibition, and the mass media. People People are all human actor who had a part in providing the services. (Zeithaml, 2009). According Enache (2011), education services associated very strongly with people involved in the distribution of services. Faculty and administrative staff is very important to attract students. Physical Evidence The physical evidence is a component of the offer tangible services. (Ivy, 2008). According Enache (2011), because the educational product intangible physical evidence has an important role as evidence of the product that will be provided in the registration phase. In the registration phase, building and campus facilities, hardware and all other tangible evidence reflects the quality of the services to be provided. Process Processes are the procedures, mechanisms and flow of activities that actually when services are rendered. (Zeithaml, 2009). The process is how things happen in an institution such as process management, enrollment, teaching, learning, social and even sports activities. (Kotler and Fox, 1995). Study selection decisions According to Kotler and Armstrong (2013), consumer behavior is influenced by cultural, social, personal, and psychological. Study selection decision in this study refers to the concept of purchasing decisions in the field of marketing. Purchasing decisions consists of five stages: recognition of needs, information search, evaluation of alternatives, purchase decision and postpurchase behavior.

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RESEARCH METHODS Research Approach This study uses a quantitative approach to causality. According Sugiyono (2013), quantitative research methods can also be interpreted as a method of research that is based on the philosophy of positivism, is used to examine the population or a particular sample, the sampling technique is generally done at random, data collection using research instruments, data analysis is a quantitative / statistics in order to test the hypothesis that has been set. Causality in this case would see a causal link of one or several variable against another. Place and time of research The study was conducted in STIKES RS. Anwar Medika Sidoarjo Jalan By Pass Krian Km. 33, Sidoarjo, East Java. First, the authors observation data on the number of students in STIKES RS. Anwar Medika Sidoarjo, then perform final project proposal preparation from March-May 2016 is to make the questionnaire as a source of research data. Authors plan began to collect and process data in mid-May, 2016. Population and Sample Population is a generalization region consisting of objects or subjects that have certain qualities and characteristics defined by the researchers to learn and then drawn conclusions (Sugiyono 2013). The explanation of the population in this study were students STIKES RS. Anwar Medika Sidoarjo with a total student of class I / 2015 and class II / 2016 as many as 132 people. Slovin formula obtained by using a sample of 57 respondent. The sampling technique used in this research is purposive sampling. Sampling criteria in this study were students who study in STIKES RS. Anwar Medika Sidoarjo. These criteria are taken with the consideration that the students who have to study in STIKES RS. Anwar Medika Sidoarjo better understand the internal conditions, so as to provide more accurate responses about the elements of the marketing mix in STIKES RS. Anwar Medika Sidoarjo besides STIKES RS. Anwar Medika Sidoarjo including educational institutions that are new, namely the number of students as much as two generations. By taking a sample of the student of class I / 2015 and class II / 2016 is expected to provide accurate recommendations to management STIKES RS. Anwar Medika Sidoarjo on effects of marketing mix elements that have been done. Method of collecting data This final project using an instrument with a likert scale questionnaire. In the measurement, each respondent was asked to comment on a statement, with a rating scale from one (1) to five (5). Responses strongly agree rated most five (5) and responses strongly disagree rated least one (1). Measurement of Variables The independent variables used in this research that the marketing mix elements which are composed of a variable product, price, promotion, location, lecturer and staff, physical evidence, as well as the process. The dependent variable is the selection of a student's decision to study in STIKES RS. Anwar Medika Sidoarjo. Product

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The indicator used to measure product STIKES RS. Anwar Medika Sidoarjo draws on research Kotler & Fox (1995); Ivy (2008); Mustafa et al. (2014); Ogunnaike et al. (2014): 1. The curriculum or program quality lectures. 2. Learning programs that can provide improved student achievement. 3. Lectures practical activities that can provide a new experience to students. Price The indicator used to measure prices in STIKES RS. Anwar Medika Sidoarjo draws on research Alipour et al. (2012): 1. Their installments on payment of the cost of money building. 2. Pieces Special fees for students who excel. 3. Details of tuition fees is published in detail through the school website. 4. Brochures containing items about tuition. Location Indicators used to measure the location STIKES RS. Anwar Medika Sidoarjo refers to study Li and Hung (2009): 1. Ease to reach public transportation. 2. The location is close to the settlement (residence) Student. 3. Easy road access for students Promotion The indicator used to measure promotional STIKES RS. Anwar Medika Sidoarjo refers to study Li and Hung (2009), namely: 1. Delivery of the vision and mission through brochures or leaflets to students. 2. Informasi yang diberikan selalu up-date. 3. The publication of student accomplishments ever achieved. 4. The meeting between the parents of students and the institutions to create a communication positive feedback. 5. Education exhibition for promotional activities. 6. The use of mass media such as newspapers in a media campaign 7. Special event title for the graduation ceremony (graduation) so that other people know more about the existence of the institution. Lecturer and staff The indicator used to measure faculty and staff STIKES RS. Anwar Medika Sidoarjo refers to Kotler and Fox (1995), Ogunnaike et al. (2014) and Mustafa et al. (2014): 1. Qualified lecturers. 2. Lecturers who can express themselves clearly to students. 3. Lecturers can adopt appropriate teaching techniques to the field of study. 4. Lecturers who coined polite behavior 5. Lecturers who have high concern to students. 6. Academic administrative staff who provide excellent service to students. Physical Evidence The indicator used to measure physical evidence STIKES RS. Anwar Medika Sidoarjo refers to Kotler and Fox (1995) and Ogunnaike et al. (2014): 1. The appearance of the building that supports learning fun. 2. And environmental hygiene are well preserved.

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3. Academic facilities such as lecture halls are equipped with multimedia and AC. 4. Laboratories that can support learning activities. 5. Amenities featured. 6. Internet connections that support learning activities. Process The indicator used to measure processes in STIKES RS. Anwar Medika Sidoarjo refers to research Kotler and Fox (1995): 1. Student enrollment is easy and uncomplicated. 2. The process of re-registration student administration that works effectively. 3. The lecture is executed properly, in accordance with the curriculum department Study selection decision Indicators used to measure the selection decision refers to the theory and Armsrong Kotler (2013): 1. The main options for the study according to the needs of students. 2. Election after knowing the information that comes from advertising, and the experiences of others. 3. Selection after high school compared with other similar. 4. The belief of the students after analyzing various information. 5. Recommendations to others in need RESEARCH METHODS Validity and Reliability Validity is a measure that indicates the level of validity of an instrument (Arikunto, 2010). Test validity can be done by performing the correlation between scores on each item answer questions with a total score answers. If the significance of the correlation value generated less than 0.05 (α = 5%), then the item is considered valid statement. Reliability refers to the notion that the instrument trustworthy enough to be used as a tool of data pemgumpul (Arikunto, 2010). Reliability indicates whether such instruments consistently deliver results on something the same size as measured at different times. Reliability is measured by Cronbach alpha. If Cronbach alpha greater than 0.60, the questioner is reliable. Regression analysis To test the effect of variable product, price, location, promotion, faculty and staff, physical evidence, and the proceedings against the electoral college decision in this study used multiple linear regression analysis, which the model is (Sugiyono, 2013): Y = a + b1X1 + b2X2 + b3X3 + b4X4 + b5X5 + b6X6 + b7X7 + e Information: Y = The decision electoral college a = Intercept bi = Regression coefficient X1 = Product X2 = Price X3 = Location X4 = Promotion X5 = Lecturer and staff X6 = Physical evidence X7 = Process e = Error Results and Discussion Characteristics of Respondents

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Respondents identified by gender, age, national origin, as well as the work of parents. Based on the results of data processing is concluded that the majority of students who are the sample were female (80.7%), aged between 18-20 years (75.4%), derived from Sidoarjo (56.1%) and had parents with private jobs (54.4%). Descriptive analysis The average value and standard deviation calculated the respondents' answers to a description of the answers in the questionnaire. Based on the results of data processing is concluded that the student has a good perception on aspects of product, price, location, promotion, faculty and staff, physical evidence, as well as the process. This is indicated by the value of the average response at each variable at 3.51-3.77 with the agreed categories. Moreover the perception of the election decision STIKES RS. Anwar Medika can also be said to be high, with an average of 3.87. Standard deviation for answers in each item also shows the diversity of data is relatively low. Validity and Reliability Test Results Test the validity of using the Pearson correlation showed that each indicator generates significance value less than 0.05, so it can be said that the indicators used in the questionnaire was valid. Each variable produces Cronbach alpha values greater than 0.6, between 0.642-0.828, in addition to the value of Cronbach alpha if item deleted every indicator does not exceed Cronbach alpha values for each variable. From these results it can be concluded that the questionnaire in this study can be expressed reliably. Regression Analysis Regression analysis was performed using SPSS 20.0. Here are the results: Table 1. Regression analysis result Coefficients a

Model 1

(Constant) X1 X2 X3 X4 X5 X6 X7

Unstandardized Coefficients Std. Error B .206 .168 .096 .036 .065 .153 .226 .107 .181 .074 .073 .115 .244 .110 .102 .022

Standardized Coefficients Beta .142 .192 .249 .194 .081 .222 .023

t .815 2.631 2.338 2.113 2.447 .629 2.214 .211

Sig. .419 .011 .024 .040 .018 .532 .031 .834

Collinearity Statistics VIF Tolerance .734 .317 .155 .342 .129 .214 .187

1.363 3.151 6.445 2.922 7.746 4.676 5.343

a. Dependent Variable: Y

According to the table above, the regression model can be written as follows:

The value of F count generated is equal to 59 558 with a significance value of 0.000, where significant value is smaller than 0.05 (α = 5%), which means that there is significant influence from variable products (X1), Price (X2 ), location (X3), promotion (X4), Lecturer and staff (X5), Physical evidence (X6), and process (X7) simultaneously to decision electoral college (Y). Based on the regression results in the table above is known that the variable Products (X1), Price (X2), Location (X3), Promotion (X4), and Physical Evidence (X6) each generate significant t-value is smaller than 0.05, with conclusion that partially these five variables, namely Product (X1), Price (X2), location (X3), promotion (X4), and Physical evidence (X6) has a significant influence on the electoral decree STIKES RS. Anwar Medika. Meanwhile, the results of testing the effect of variable Lecturers and staff (X5) and Process (X7) of the Electoral

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Decree STIKES RS. Anwar Medika generate significant value greater than 0.05, or with the conclusion that the variables of faculty and staff as well as process variables, partially no significant effect on the Electoral Decree STIKES RS. Anwar Medika. The coefficient of determination showed kindness size regression model or size of data variation in the dependent variable (Y) which can be explained by variations in the data in the independent variable (X). Here is the value of the coefficient of determination resulting in the regression model in this study: Tablel 2. Coefficient of determination Model Summary b Model 1

R R Square .946a .895

Adjusted R Square .880

Std. Error of the Estimate .17694

DurbinWatson 1.885

a. Predictors: (Constant), X7, X1, X4, X2, X6, X3, X5 b. Dependent Variable: Y

The coefficient of determination for 0.895 show that 89.5% of variation of data Decisions Selection of students can be explained by Product (X1), Price (X2), location (X3), promotion (X4), Lecturer and Staff (X5), Physical Evidence (X6), and process (X7). With the other interpretation can be concluded that the product (X1), Price (X2), location (X3), promotion (X4), Lecturer and Staff (X5), Physical Evidence (X6), and Process (X7) has the effect of 89.5% the selection of the Decision RS STIKES. Anwar Medika. Discussion Based on the results of the regression analysis concluded that the product significantly influence selection decisions STIKES RS. Anwar Medika. Kotler and Fox (1995), suggests that aspects of the product of a college education is a program that identifies an educational institution. In connection with this opinion, STIKES RS. Anwar Medika presenting educational programs on the basis of medical science as the basis for the curriculum, which is expected to meet the needs of consumers. In addition to the courses offered by the program D3 Midwifery and S1 Pharmacy with the assurance of higher education accreditation adds value for STIKES RS. Anwar Medika, of course, with the support of hospital facilities as a means of supporting the practical activities of lectures for students is expected to increase the interest of students or prospective students to choose STIKES RS. Anwar Medika as a place to continue higher education. Price significant effect on selection decisions STIKES RS. Anwar Medika. In accordance with the opinion of Ivy (2008), the price also affects the perception of students in a lecture at the institution pendidikan.Biaya STIKES RS. Anwar Medika determined by considering aspects of consumers competitively specified in detail in the components of the charge before the lecture was held. In addition STIKES RS. Anwar Medika also provides convenience fees for students with their college scholarship program, installment plans building costs money, as well as pieces of special fees for students excel. With the program selection decision is expected STIKES RS.Anwar Medika increased. Significant effect on the location selection decision STIKES RS. Anwar Medika. According to Price et al. (2003) The location has an impact on costs, where it is a significant factor in the selection process of the university. The location is within easy reach of public facilities, close to the settlement of students, as well as the ease of access will form one of the considerations in the selection of the university. STIKES RS. Anwar Medika founded in Jalan By Pass Krian Km. 33, Sidoarjo, East Java. With these locations make STIKES RS. Anwar Medika very easy to reach by public transportation such as city buses and other transport equipment because it is located on the main road Krian. Besides its strategic location makes it possible for students from

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the region to reach out to support the decision of increasing the student to select STIKES RS. Anwar Medika. Promotion significantly influence the election decision STIKES RS. Anwar Medika. According to Li and Hung (2009) sale either through formal or informah media (pamphlets, letters, brochures, or internet portals) is an important element in marketing. In this regard, STIKES RS.Anwar Medika very concerned about the promotional aspects, through both education fairs, promotion through graduation activities, the vision and mission as outlined in the brochure, as well as through the publication of student achievement in a variety of media. Based on the results of the regression analysis concluded that faculty and staff did not significantly influence the election decision STIKES RS. Anwar Medika. STIKES RS.Anwar Medika is one of RS.Anwar Medika development unit working in the field of education. From the aspect of public service in general, or students in particular will see the RS. Anwar Medika as consideration to make your choice RS.Anwar STIKES Medika, so RS.Anwar Medika become a brand that stands out in the election STIKES. Physical evidence of significant effect on selection decisions STIKES RS. Anwar Medika. According to the Ivy (2008), components of physical evidence, namely the building and campus facilities, hardware and all other tangible evidence to contribute to the first impression of the students. In this regard STIKES RS. Anwar Medika very concerned about the physical aspects, by providing facilities such as laboratories or lecture facilities directly connected with a hospital facility or school building facilities that are currently in the process of remodeling construction. Hopefully, by the adequate physical facilities, the tendency election Medika increased STIKES RS.Anwar. The process does not significantly influence the selection decision STIKES RS. Anwar Medika. This suggests that the selection decision by the student does not make the process as considerations which mean, this is because the registration and re-registration process students have effectively done online, making it easier for students. The lecture does not affect significantly the selection decision STIKES RS. Anwar Medika pretty confident is because students with curriculum suitability is given especially with the support of hospital. Managerial implications Research has been done on the effect of the marketing mix is the decision-making students in choosing STIKES RS.Anwar Medika can ultimately provide managerial implications that can be used as internal guidelines STIKES RS. Anwar Medika to improve the marketing mix. Relating to the variable products, has implications for the improvement of the quality of the instrument of accreditation under the terms of BAN-PT, which is associated with learning programs and lectures, study visits to educational establishments other, with regard to the effectiveness of learning programs and learning activities as well as Perform advanced studies on the effectiveness of learning programs and learning activities in STIKES RS. Anwar Medika. With regards to price, namely by completing the draft of school fees through the website, along with details, giving installment terms with a much longer time and conduct further studies with the aim that the opportunity for prospective students to get fee waivers running on target and evenly. With regards to location, the implication that the procurement of public transport such as buses or metromini campus once a public bus stop, provides residential facilities (mess) for students around the campus, as well as increase security around the campus area, and ensure that no flooding. In connection with promotion, holding implications for the need to further study on the effectiveness of the media campaign of STIKES RS. Anwar Medika, as well as promotion through cooperation with local television stations, to strengthen the brand in the first.

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In connection with lecturer and staff, has implications for the need for improvement of high concern to students is evidenced by the group in social media between lecturers and students, as well as the improvement of services of administrative staff when serving to give a smile and a faster turnaround. In connection with the physical evidence, implications for the Development of physical facilities do STIKES new building with adequate facilities, as well as the renovation (repair) the entrance to the location. In connection with the process, the implications for the re-registration process only through academic administration, as well as the lecture was orderly process that is the subject that must be taken in accordance with the Ministry of Health and Higher Education with the appropriate number of credits. Conclusions and recommendations Conclusions Based on the analysis, it can be concluded as follows: 1. The result of partial effect. a. Variables that affect the decision are Product (X1), Price (X2), Location (X3), Promotion (X4), and Physical Evidence (X6 ) thus concluded that partial these variables have a significant influence on the Student Decision to Continuing Studies in STIKES RS. Anwar Medika. As for who has the highest influence Physical Evidence (X6) and low of influence Products (X1). b. Variables which do not affect that lecturers and staff (X5) and Process (X7), so that it can be concluded that the partial variable does not affect the student's decision to Continuing Studies in STIKES RS. Anwar Medika. 2. The test results influence simultaneously shows that the significance value of 0.000> 0.05 thus concluded that there is significant influence from variable products (X1), Price (X2), location (X3), promotion (X4), Lecturer and Staff (X5), Physical Evidence (X6), and process (X7) simultaneously to the Decision of Students for Continuing Studies in STIKES RS. Anwar Medika (Y). 3. The coefficient of determination is equal to 0895. This value indicates that 89.5% of variation of data Decisions Selection of students can be explained by Product (X1), Price (X2), location (X3), promotion (X4), Lecturer and Staff (X5), Physical Evidence (X6), and Process ( X7). With the other interpretation can be concluded that the product (X1), Price (X2), location (X3), promotion (X4), Lecturer and Staff (X5), Physical Evidence (X6), and Process (X7) has the effect of 89.5% the selection of the Decision RS STIKES. Anwar Medika. Recommendations Based on the conclusion, it can be submitted several suggestions as follows: 1. For STIKES RS. Anwar Medika: a. Should pay more attention to product variable, price, location, promotion, and Physical Evidence even need to be improved these factors have a significant influence on the Electoral Decree STIKES RS. Anwar Medika. b. Increased competence of lecturers and staff services Stikes Anwar Medika Hospital will continue to be a priority in its development, although in this study was not a factor for students in choosing a college.

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2. For academics in particular further research is to see the value of R square is 0895, or 89.5%, so there is 10.5% variable or other factors that influence the decision making in choosing a college, so researchers can further increase the number of variables or factors other than variables or factors has existed in this study. REFERENCES Abdillah, W., & Jogiyanto, H.M. 2009. Konsep dan Aplikasi PLS Untuk Penelitian Empiris. Edisi 1. Yogyakarta: BPFE. Alipour, M., et al. 2012. A new educational marketing mix: The 6ps for private school marketing in Iran. Research Journal of Applied Sciences, Engineering and Technology, 4(21), 4314-4319. Arikunto, S. 2010. Prosedur Penelitian Suatu Pendekatan Praktek. Jakarta: Rineka Cipta. Buchari, Alma. 2009. Manajemen Pemasaran dan Manajemen Jasa, Edisi II. Bandung: Alpha Beta. Enache, I. C. 2011. Marketing Higher Education Using the 7 Ps Framework. Bulletin of the Transilvania University of Brasov. Series V: Economic Sciences, 4(1), 23-30. Ghozali, I. 2011. Structural Equation Modeling Metode Alternatif Dengan Partial Least Square PLS, Edisi 3. Semarang: BP. UNDIP. 2011. Aplikasi Analisis Multivariate Dengan Program SPSS. Semarang: BP. UNDIP Glava, C. C., & Glava, A. E. 2015. Moment of Truth in Educational Marketing. Factors That Contribute to the Decision Making on the Educational Market in Romania. Procedia Social and Behavioral Sciences, 180 (November 2014), 170-175. Ho, H.F. 2014. Revamping the Marketing Mix for Elementary Schools in Taiwan. Asian Social Science, 10(3), 15-25. Ivy, J. 2008. A new higher education marketing mix: the 7Ps for MBA marketing. International Journal of Educational Management, 22(4), 288-299. Kotler, P., & Armstrong, G. 2013. Principles of Marketing. World Wide Web Internet And Web Information Systems, 42, 785. Kotler, P., & Fox, K. F. A. 1995. Strategic marketing for educational institutions. Engle Wood Cliffs Prentice Hall. Li, C., & Hung, C. 2009. Marketing tactics and parents’ loyalty: the mediating role of school image. Journal of Educational Administration, 47(4), 477-489. Lupiyoadi, R dan A. Hamdani. 2008. Manajemen Pemasaran Jasa Edisi II. Jakarta: Salemba Empat. Muhyidin, U. 2015. Pengaruh Bauran Pemasaran Jasa Pendidikan Terhadap Keputusan Mahasiswa Memilih Perguruan Tinggi Swasta Di Jawa Barat. Prosiding Seminar Nasional Multi Disiplin Ilmu & Call For Papers Universitas Stikubank. Semarang: ISBN:978-979-3649-81-8. Mustafa, L. M., et al. 2014. An Overview of Private Preschool in Malaysia: Marketing Strategies and Challenges. Procedia-Social and Behavioral Sciences, 130, 105-113. Ogunnaike, O. O., et al. 2014. Empirical Analysis of Marketing Mix Strategy and Student Loyalty in Education Marketing. Mediterranean Journal of Social Sciences, 5(23), 616625. Oentoro, D. 2012. Manajemen Pemasaran Modern. Yogyakarta: Laksbang Pressindo. Price, I., et al. 2003. The impact of facilities on student choice of university. Facilities, 21(10), 212-222. Purwanto, N. A. 2011. Strategi bersaing dalam bisnis pendidikan. Jurnal Manajemen Pendidikan, 7(01), 9-16.

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Santoso, S. 2014. Panduan Lengkap SPSS Versi 20. Edisi revisi. Jakarta: Gramedia. Sugiyono. 2013. Metode Penelitian Bisnis. Bandung: Alfa Beta. Tabita & Halim. 2014. Faktor-faktor yang mempengaruhi siswa SMA dalam Memilih Perguruan Tinggi. Prosiding Seminar Nasional Teknik Industri UK Petra 2014. ISBN 978-602-71225-1-2. Yoo, B., et al. 2000. An Examination of Selected Marketing Mix Elements and Brand Equity. Journal of the Academy of Marketing Science, 28(2), 195-211. Yulfita’aini. 2010. Analisis Pengaruh Marketing Mix Terhadap Keputusan MahasiswaDalam Melanjutkan Studi Pada Perguruan Tinggi (Studi Pada Universitas Pengaraian-Riau). Tesis, Universitas Brawijaya, Malang. Zeithmal, V. A., et al. 2009. Service Marketing: Integrating Customer Focus Across The Firm. London: Mc. Graw Hill http://www.republika.co.id http://www. kopertis7.go.id http://www.stikesanwarmedika.ac.id

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BUSINESS TO BUSINESS MARKETING STRATEGIES FOR FRESH ORANGE JUICE XYZ PRODUCTS Alvand Gosal, 2Denny Bernardus♠

1

Ciputra University Surabaya INDONESIA Email: [email protected], [email protected] ABSTRACT This study discussed the marketing strategies. The purpose of this research was to investigate marketing strategies for suitable B2B (business to business) market segments in XYZ fresh fruit juice company. Using a qualitative approach, this study involved three types of subjects: hotels, cafes and restaurants. The key informants were purposively selected. The data were obtained through semi-structured interviews. Five informants were selected based on XYZ's target fresh fruit juice market, two hotels, two cafes and one restaurant. This study recommended that it was important to change people's mindset to buy fruit juice in the packaging. The set price of Rp. 30.000/liter was considered acceptable by hotel, restaurant, and café customers. The researchers used such fixed price to market fresh orange juice products. People preferred 500 ml and one liter for proper size of the packaging. With that size, the products woud not be stored for too long, and still had good tastes. Keywords: Marketing Strategies, Orange Juice, Marketing Aspects, Marketing Tools

INTRODUCTION Food and beverage as one of Indonesia’s industrial sectors has been increasingly growing. This sector continues developing in the future due to favorable investment climates in the country, in addition to growing numbers of public consumption. Indonesian people consume 33 liters/capita of soft drink. In other Asean countries, the consumption levels of Thai people and Singaporeans have reached 89 liters and 141 liters per capita respectively. In a social life, people get used to entertaining their guests at home with soft drinks in packs since it is more practical (Pos Kota, 2016). Packed soft drink industries include tea, soda, coffee and isotonic drinks and fruit juice (Mars, 2016). XYZ Company starts running packed fresh orange juice fruit. For XYZ Company, it is a good businesss because no other companies use 100% of original orange, without making use of preservatives. XYZ fresh orange juice products are produced to fill the gap in the prevailing markets. XYZ companies claims to have comparative advantages for using 100% original citrus fruits and without any preservatives. The company needs to develop good marketing strategies to promote better investment plans. Considering good opportunities into consideration, this study aims to examine suitable marketing concepts for packed soft drink industries, especially fresh orange juice XYZ. The research problem of this present study is formulated as follows: "how is the business to business marketing strategy for fresh orange juice XYZ conducted?" The purpose of this

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research is to design the marketing activity concepts and strategies relevant to needs of B2B (business to business) customers, especially hotel, restaurants, cafes customers, through the sales of packed fresh orange juice by XYZ Company. LITERATURE REVIEW Previous Studies The first study, entitled "The Influence of Marketing Mix and Consumer Behavior on DecisionMaking Purchase of Fresh Fruit Juice" by Octaviani, et al., (2014) aimed to analyze the characteristics of respondents from fresh fruit juice consumers in Bandar Lampung. The mixed marketing had significant effects on the product, price, place and promotion of customers’ decision making to purchase fresh fruit juice in Bandar Lampung. The research was conducted in Zainar Pagar Alam Street, Jalan Purnawirawan, and Pramuka Street in Bandar Lampung. The samples of this study included 105 students who were deliberately chosen when they bought fresh fruit juice from January 2014 until February 2014. The second study entitled "The Influence of Marketing Mixes on Rolas Buying Decision" was conducted by Primary (2015). It aimed to investigate if mixed marketing consisting of product, price, promotion, and location had simultaneous or partial influences on customers’ purchasing decisions of Rolas Tea. The analysis technique used was multiple linear regression, involving as many as 72 respondents. The third study, entitled "Marketing Strategy Codification of Sport Drinks (Case Study of Padideh Dinavand Food Products Industries Company) was conducted by Saeednia, et al., (2016). This study aimed to investigate if the mission of an organization must be formulated; the environmental influences that become opportunities and threats to the organization must be known; the strengths and weaknesses in the organization become the outcomes that need to be achieved; different strategies for the future should be specified specifically to continue the organization. The purpose of this research was to formulate marketing strategies for Padideh Dinavand Co. SWOT ANALYSIS If a company does not know the advantages, shortcomings, opportunities and threats to business, then it will be difficult for that company to develop. Companies need to analyze the strengths, shortcomings, opportunities and threats of companies using SWOT. SWOT is a way to monitor the state of organization both internally and externally (Kotler and Keller, 2012: 70). SWOT is an abbreviation of S (Strengths) is an advantage that the company has from the internal side compared to competitors. W (Weakness) is the company's internal deficiencies compared to competitors. O (Opportunity) is an external state that can be utilized by the company. T (Threat) is an external factor that can affect company performance. STP (SEGMENTING, TARGETING, POSITIONING) A company needs STP for the basis of marketing strategy (Kotler and Keller, 2012: 56). Before running marketing activities, STP needs to be done first. Segmenting or commonly referred to as market segmentation is the process of dividing groups of buyer into categories or customer types. The purpose of the market segmentation is to make companies easier to serve a variety of market needs (Hasan, 2013: 331). Targeting means choosing one or more target segments to be served based on the segment's potential profits and corporate corporate strategies (Tjiptono, 2014: 26). Targeting implies that the target market of the company has been scaled down. Positioning is how marketers differentiate their services from competitors in the views of customers (Ratnasari and Aksa, 2016: 27). Companies need to instill the identity of their products or services. MARKETING MIX B2B

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According to Saha (2013), the concept of marketing mix for industrial consumers (B2B) is very different from the marketing mix intended for retail consumer (B2C). The fundamental difference is that every industrial consumer has different needs and must be served specifically (custom). Therefore, here are some marketing mix concepts for B2B. Product To get a new B2B customer and maintain a long-term relationship with that customer, the customers always request the samples according to the required description before purchasing the product. Companies that serve B2B customers always change their products in terms of shape, color, quality, etc based on customer's desired specifications (custom). B2B industry customers are usually more rational in deciding which suppliers to take. Because the product will be resold to retail consumers later, B2B customers are very concerned about the quality and consistency of the availability of goods to be taken. According to Saha (2013), the key to successful marketing mix, especially the first "P" aspect (product) is on service (service) to B2B customers.

Price With regard to the second marketing mix of price aspect, industrial customers or B2B customers are very concerned with how the company offers the price and payment terms later. Number of goods taken, the consistency of repeated purchase, and smooth payment of accounts receivable are factors worth considering by companies targeting the B2B segment. There is neither exact price nor special benchmark given to B2B customers because every customer is expected to have specific service related to product quality, color, packaging, etc. Companies should have a pricing method for determining the minimum selling price to offer to customers. The followings are are six pricing methods (Kotler and Keller, 2012: 417): Place In the B2B business market, it is important that knowledgeable, experienced and effective salesmen carry out a place-related marketing mix function. In addition, getting a loyal distribution channel, from the level of distributors, agents, to resellers is also very important. Salesmen need to persuade the shop owners to put the products in the right place. Promotion Promotion is an activity that the company does to attract customers to buy a product. According to Saha (2013), the concept of promotion as the fourth aspect of the marketing mix in the B2B world should be run in two directions: push marketing and pull marketing techniques. Push marketing technique is a promotional technique that encourages the shop owners to put the product arrangement in the strategic areas in their store. This can be done by placing a banner or in-store promotion, etc. Pull marketing technique is a promotional technique that encourages end-users to learn about products, and they finally decide to buy them at the nearest store. For example, this can be done by advertising in mass media such as radio, newspapers, internet, etc.

COMPETITOR PROFILE MATRIX CPM is a matrix used to assess the company's competitors by using several key success factors. Zimmerer in the journal Sohel, et al., (2014) said that "Competitor Profile Matrix (CPM) is a tool which helps the companies to assess their major success factors for that industry." CPM can

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be used by certain companies to compare their performance with those of other companies by referring to key success factor as indicators. Bygrave and Zacharakis in the journal Sohel, et al., (2014), said "CPM not only creates a powerful visual catch-point but also conveys information about your competitive advantage and is the basis for your company's strategy". CPM is useful to see the advantage of competing with other companies, and it can be the basis of making corporate strategy. The researcher used SWOT, STP, Marketing Mix, and CPM analysis to formulate marketing strategy for fresh orange juice to middle to upper class customer segments or Horeka customers (hotel, restaurant, and cafe). Interviews were conducted to collect data from the respondents who become the target customers of B2B. RESEARCH METHODS Using a qualitative method, this study focused on the company's internal data while referring to marketing theories. The Primary data were collected from the objects of the study through interviews (Mardalis 2014: 28). The research site was in Surabaya becuae the business plan would be in Surabaya area. Theoretical references, guidance from supervisors, and interviews with informants were conducted from February 26, 2017 to April 26, 2017. The subjects of the study were purposively selected using non-probability sampling method. Researchers took five key informants from prospective customers of fresh orange juice company "XYZ". These informants were from different sites such as hotels, restaurants and cafes. Three places were also chosen they became the largest customers of business to business for fresh orange juice products. The researcher chose five sources whose purpose was to know the customer's views about fresh orange juice in terms of taste, smell, packaging, color, and price. It can help researchers in making this marketing strategy. The following resources are the objects of the interview.

Table 1. Respondent No

Name

Companies

Position

1 2

Hans Charles Haryo Nugroho

Kafe Koniq Kafe Common Grounds Restaurant Guilin Hotel Java Paragon Hotel Ibis Budget

Owner Manager

Date of Informant Interview Code 26 April 2017 HC 19 April 2017 HR

Owner Supervisor Manager

28 April 2017 27 April 2017 1 Mei 2017

3 Ivan Sebastian 4 Romli 5 Hendri Setiawan Source : Primary Data

IV RM HS

There are four methods for data collection: in-depth interviews, participatory observation, focus group, and documentation (Son, 2012: 46). This present stidy used documentation and interview. Researchers took documentation as a method of data collection in order to maintain the validity of the data. Interview methods were conducted towards the informants from 3 different company types: hotels, restaurants, and cafes. After the interview, marketing strategies of fresh orange juice XYZ were developed. If the results obtained were not feasible, then the researcher would make improvements on the planning of marketing activities. Otherwise, the researcher would continue running fresh XYZ fresh food business

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SWOT

The Marketing Strategies of B2B Fresh Orange Juice “XYZ”

STP Marketing Mix CPM

Hotel Java Paragon

Hotel Ibis Budget

Kafe Koniq

Kafe Common Grounds

Restaurant Guilin

MARKETING ANALYSIS STRATEGIES

MARKETING STRATEGIES

Figure1.1 Analysis Model RESULTS AND DISCUSSION Setelah melakukan penelitian dan pembahasan terhadap rencana strategi pemasaran yang akan dilakukan oleh perusahaan fresh orange juice XYZ terdapat beberapa implikasi manajerial yang dapat diterapkan pada perusahaan. Pada implikasi manajerial, penelitian lebih memperhatikan ke bagian pemasaran, yaitu berdasarkan analisis SWOT, STP, Marketing Mix dan CPM, khususnya untuk masuk ke dalam segmen B2B (business to business). There were some managerial implications to apply in the company. In terms of the managerial implications, it is a marketing department that needs to be intensified. Based on SWOT, STP, Marketing Mix and CPM analysis, this department should be improved in order to penetrate into the B2B segments (business to business).

Table 1.2 Magerial Implications No 1.

235

Variable SWOT

Before Research After Research Not knowing detail • The researchers can make use of the strength of about strength, the company's products: using 100% unrefined weakness, orange juice and other additives and affordable opportunity, threat product prices. Using 100% oranges need to be highlighted in marketing activities. • The researchers find solutions to counteract

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• •

2.

STP

The target, segment and positioning were still not optimal

3.

Marketing The prevailing Mix startegies were not optimal

• • • •

4.

CPM

Ignoring the existing competitors because the existing products were different from those in the market.

Source: Primary Data

• •

company weaknesses. For example, products could be quickly damaged because they had no preservatives. There has been no brand that had inconstant sense because it uses the original citrus fruit. The prevailing opportunities could be exploited by researchers to market the product: healthy lifestyle trend in the future. The researchers had to be careful about existing threats and also sought solutions to avoid threats: extending the horizon of customers’ mindset (hotels, restaurants, cafes) that packaged fruit juices had to be equipped with preservatives and concentrates. Moreover, there were a lot of famous competitors. • To get additional target markets such as people who liked to go to the gym • To have proper product positioning: cheap fresh orange juice products whose price was Rp30,000 per liter. • The usual target markets for orange juice were parents, young executives and families in the hotel (hotels, restaurants, cafes) The preferred size of the products was from 500ml to one liter. Rp30,000/liter was accepted by hotel, restaurant, and café customers. Hotel, restaurant, and café were the most appropriate place for marketing. Determining appropriate marketing strategies of the analysis. Find out the main competitors known by hotels, restaurants, and cafe customers through the country choice. Monitor marketing activities in order to find out what customers like so that they give their trust. II.

The managerial implications are worth considering. The companies need to put these insights into their consideration so that their business can be properly run. STP's strategy need to focus on the upper middle segments, horeka customers, and positioning as fresh products with affordable price adjusted to the strength and opportunities. The informants mention that fresh orange juice products are very attractive to them who like to come to the hotels, restaurants and cafes. As a reults these products are very promising and business is worth developing. CONCLUSION This study found fresh products juice XYZ is suitable for the upper middle segments such as hotels, restaurants and café customers, in addition to retailers and supermarkets. With regard to positioning, people need to be convinced that fresh orange juice product is without concentrates,

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preservative, and any other additives. These packed products can be consumed as healthy beverage. With regard to marketing mix, the price set of Rp30,000/liter is still considered affordable by horeka consumers (hotel, restaurant, and cafe). They become the main marketing targets for the products. The findings of the study serve a reference for the writers to plan marketing strategies in the future, focusing more on production of one liter than the other size. In the same way, ATL and BTL have to do the same in order to attract the interest and from their customers. The marketing mix (product, price, place, promotion) set for fresh orange juice has been tailored for the horeka consumer as the main target of market segmentation. The selling price of Rp30,000/liter is still very affordable for the upper middle class who often come as visitors in hotels, restaurants, and cafes. They prefer products that care about health rather than cheap products but with poor quality. To realize the results of this study into a real business, the following is an action plan timeline that will be done in the early stages of business planning. In the first year, the writers will conduct business feasibility studies in depth, focusing on financial and non-financial aspects. In the second year, the author will prepare the capital to be used as assets in the form of land and infrastructure. In the third year, operations and production will run as planned. Five steps B2B marketing strategy include the following steps: 1) recruiting direct selling sales force to target to the consumer horeka; 2) conducting various promotional cooperation with media and other institutions such as airlines, fitness centers, etc. that have a high demand for fresh orange juice products; 3) paying attention to the consistency of taste quality and; 4) maintaining product availability in order to build consumer confidence. In so doing, new companies will get trust from their customers and 5) pursuing competitive advantages. Costleadership strategy becomes the focus in early years of marketing so that they can compete with competitors. This study has some limitations such as limited number of informants. They are not all from middle-class hotels, restaurants and cafes. The demands for fresh orange juice in horeka are very little. The informants also come from fitness centers and airlines that may have a greater demand for fresh orange juice products. In addition, due to the fact that XYZ Company has not been operating, or it is still in the planning stage. It is important to do the analysis of strength, weakness, opportunity, and threat by referring to secondary data considerations. REFERENCES finance.detik.com. (2016). Kejar Pertumbuhan Industri 5,4% di 2017 Ini Langkah Menperin. Jakarta: www.finance.detik.com. Hasan, A. (2013). Marketing dan Kasus-Kasus Pilihan. Jakarta: CAPS. Herdiansyah, H. (2012). Metodologi Penelitian Kualitatif untuk Ilmu-Ilmu Sosial. Jakarta: Salemba Humanika. Ireland, D. (2013). Strategic Management : Competitiveness and Globalisation. Australia: Southwestern. Kerin, R. H. (2013). Marketing : The Core. New York: McGraw Hill. Kotler, P. a. (2012). Marketing Management. United States of America: Pearson. Mardalis. (2014). Metode Penelitian Suatu Pendekatan Proposal. Jakarta: PT Bumi Aksara. Octaviani, M. W. (2014). PENGARUH BAURAN PEMASARAN (MARKETING MIX) DAN PERILAKU KONSUMEN TERHADAP PENGAMBILAN KEPUTUSAN PEMBELIAN JUS BUAH SEGAR BANDAR LAMPUNG. JIIA, 133-141. Poskota. (2016). Peluang Industri Minuman Ringan Masih Terbuka. Jakarta: www.poskotanews.com.

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Pratama, Y. A. (2015). PENGARUH BAURAN PEMASARAN TERHADAP KEPUTUSAN PEMBELIAN TEH ROLAS PT. ROLAS NUSANTARA MANDIRI. Jurnal Ilmu dan Riset Manajemen, 1-20. Pratiwi, W. (2016). Nilai Bisnis Industri Jus Buah Ready-to-drink Lebih Dari 8 Trilliun Rupiah. Jakarta: www.marsindonesia.com. Putra, N. (2012). Metode Penelitian Kualitatif Pendidikan. Jakarta: PT Raja Grafindo Persada. Rangkuti, F. (2006). Analisis SWOT Tekni Membedah Kasus Bisnis. Jakarta: PT. Gramedia Pustaka Utama. Ratnasari, R. T. (2016). Teori dan Kasus Manajemen Pemasaran Jasa. Bogor: Ghalia Indonesia. Saha, S. K. (2013). B2B Marketing Mix Impact On Asia Pacific Region . INTERNATIONAL JOURNAL OF SCIENTIFIC & TECHNOLOGY RESEARCH , 65-72. Sohel, S. M. (2014). Competitive Profile Matrix (CPM) as a Competitors' Analysis Tool: A Theoritical Perspective. Research Gate, 39-47. Sugiyono. (2015). METODE PENELITIAN KUANTITATIF KUALITATIF DAN R&D. Bandung: Alfabeta. Tjiptono, F. (2014). PEMASARAN JASA. Yogyakarta: Andi. Wahyudi. (2014). Pemasaran Jasa- Prinsip Penerapan dan Penelitian. Bandung: Alfabeta.

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THE FACTOR ANALYSIS ON PURCHASING DECISION MAKING IN STORES X Yenny Rahayu, 2Tina Melinda♠

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Ciputra University Surabaya INDONESIA ABSTRACT This study examined the factors that made up customers’ purchasing decisions in Store X. The purpose of this study was to analyze the factors that determine customers’ purchasing decisions in store X. One hundred respondents who purcahed the products in store X became the samples of this study. The analytical technique used in this study is confirmatory analysis (2nd Confirmatory Factor Analysis) using the program of smart PLS version 3.0. This study found there were eight factors that determined customers’ purchasing decisions in store X including location, merchandise, pricing, communication mix, customer service, store design and display, internal (psychological), external (socio-cultural). Keywords: Merchandise, Pricing, Communication Mix, Store Design and Display, Internal (Psychology), External (Social Culture). INTRODUCTION Retail business in Indonesia has made great progress in the last few years in Indonesia. This can be seen from numbers of shops, offices, the growth of Industry, Small and Medium Enterprises (SMEs), and other types of business. The progress of existing retail business in Indonesia is due to the development of manufacturing business and the market opportunity which is quite open due to the impact of the speed of society condition. These developments have resulted in changes that affect people's lives, one of which is the place of public spending.

Figure 1. The Graphic of consuming class Growth Source: KEN, Indonesia’s Economic Projection 2011-2045 The projection of the growth of Indonesia’s consumption class in Figure 1 is projected from 2010 to 2030: there will be an increase in income of 5-6%. As a result, potential consuming class will be 90 million. If the income increase is about 7%, there will 125 million people who become consuming class. The increase in income will be accompanied by a change in people’s lifestyle standards.

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Kediri City as the city of Karesidenan with various facilities and potential become the destination of the surrounding buffer city as seen in Table 1. Based on these data, this city has visible potential for tourism that surrounding community need. Table 1. Total Population and Area Size of Kediri and Surrounding Area Size in Km Population Kediri City 63.40 293,282 Kediri Regency 963.21 1,475,000 Kertosono, Nganjuk 1,182.64 1,017,030 Jombang 1,159.50 1,201,557 Tulung Agung 1,055.65 1,024,034 Blitar 1,588.79 1,116,639 Trenggalek 1,261.40 769,966 Source: Population and Civil Registration Data of Kediri City 2015 Along with the development, Kediri with comfortable and modern economic has facilitated the needs of the residents and tourists who visit. Table 2 describes the development of the modern market in Kediri Table 2. Modern Market of Kediri City until the End of 2015 Nama Outlet Alamat HYPERMART Town Square Jl. Hasanudin, Kediri GOLDEN Swalayan Jl. Hayam Wuruk, Kediri RAMAYANA Supermarket Jl. Jend. Sudirman, Kediri SUPERINDO Supermarket Jl. Brigjen Katamso, Kediri BOROBUDUR Supermarket Jl. Panglima Sudirman, Kediri APOLLO Supermarket Jl. Doho, Kediri Source: 2015 Statistics Center Data X store which is also present in Kediri Mall has participated in fulfilling the shopping needs of Kediri people and surrounding areas as a means of family shopping in the mid of 2015. X store hopes it can serve good service to customers, employees, and suppliers. This store is presenting a new concept of making the store a better place for his community and his partner, a better place to shop with better service and execution as well. With the presence of X shop in Kediri, ths store offers new jobs and increases income of the surrounding community. Based on these rationales, it is necessary to do further analysis to improve consumer purchasing decisions. The results of a survey from 10 customers have offered data about factors that determine customers’ consideration in making purchases (Table 3). There are 11 factors (1) location, (2) promotion, (3) facilities, (4) price, (5) shop atmosphere, (6) product sold, (7) service, (8) needs, (9) ) Shopping convenience, (10) word of mouth, (11) lifestyle

No 1 2 3 4 5 6

Table 3. Survey Results from 10 consumers Factors % Location Promotion Price Price Shop Atmosphere Product sold

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7 Service 8 Need 9 Shopping convenience 10 Word of Mouth 11 Lifestyle Source: Primary Data 2016 This study aims to analyze the factors that make up the purchase decision in store "X". LITERATURE REVIEW Renfist (2012) studied factor analysis that influenced customers’ shopping behavior in supermarkets in Padang. This study was descriptive that aimed to describe the nature of something that has been going on. Stratified random sampling was used as a sampling technique (random sampling of easy-to-use population members) and Factor Analysis was used for data analysis. There were some factors affecting consumers’ shopping behavior at the supermarket in Padang: demographic, promotion, merchandising, room, facility, location, cultural and employees. About one hundred fifty six people were involved as the respondents. Herlley (2013) studied factors that influenced consumers’ purchasing decisions in J.CO Donuts, West Jakarta. Using a quantitative approach, his study used a questionnaire for a data collection method. In the questionnaires, there were 25 questions to measure 7 variables. The samples of the study were selected using purposive sampling method. The respondents should be the customers who had purchased one time at least, and they should be 17 years old. Validity and reliability tests were also employed to examine the quality of the instrument. Factor analysis was used for data analysis (to observe a pattern). Herlley (2013) found there were eight factors influencing customers’ purchasing decisions: determination of prices, a lot of variations, menu, eating standards, Jabuka J.co Donuts, discounts, employees’ uniforms, crowd and overall good service. The most dominant factor was menu variations. The number of samples involved 100 respondents. Avurry Avijeet (2013) in his study “A study on the Factors Influencing Consumer's Purchase Decision towards Smartphones in Indore” concluded that prices did not play an important role for people to buy smartphones. However, Brand, Social Image, Technology and endurance were the most important factors that influenced their intentions to purchase the products. Michael Levy and Burton A.Weitz (2013) stated that, "Retailing is the set of business activities that adds value to the products and services sold to consumers for their personal or family use". Meanwhile, according to Berman & Evans (2010), retailing is a business activity involved in the sale of goods and services to consumers for personal use, family and household. According to Berman and Evans (2010), retailing is a business activity involved in the sale of goods and services to consumers for personal, family and household use According to Lukmanuddin (2014), retail is one or more activities that add value products and services to consumers either for family needs or for personal use RETAIL MIX According to Levy and Weitz (2009: 6), "Retailing is a set of business activities that add values to the products and services sold to consumers for their personal or family use". In other words, retailing is a series of business activities that add value to products and services sold to consumers for personal or family use. According to Berman and Evans in Munir and Dirgantara (2010:4), "Retailing encompasses the business activities involved in selling goods and services to consumers for their personal, family, or household use." This means retailing includes business activities involved in the sale of goods and services to consumers for their personal, family, or household use. According to

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Levy and Weitz (2009: 21) elements in the retail mix consists of location, merchandise assortments, pricing, customer service, store design and display, and communication mix. Location (location) According Ma'ruf (2006), a location is a very important factor for customers to choose a store. Stores at the right location will be more successful than those located at other less strategic places although they sell the same products or service. Merchandise Merchandise is a product retailers sell in their stores. Merchandising is a procurement of goods in accordance with the shop's business (food-based products, clothing, home items, general products, etc., or combination) to be supplied in a store at appropriate amount, time, and price in order to reach the goals of store or retailer (Ma'ruf, 2006). . According to Barbara Farfan - Retail Expert (2016), merchandising is a part of a retail industry specific terminology that describes an aspect of retailing. This concept is much larger than a mere definition of the term can explain. The meaning of the term "merchandising" and examples should be explored in retail glossary explanation. Merchandising is any practice which contributes to the sale of products to a retail consumer. At a retail in-store level, merchandising refers to a variety of products available for sale. The products are displayed in such a way that they are able to stimulate customers’ interest to make a purchase. Merchandising is important because it is not just about what products are available in retail stores for customers. Retail stores must be able to sell their merchandise. By using best practice of merchandise, retailers or retail stores can motivate customers and consumers to spend more money in the sense that customers can shop more than usual. Pricing (price) It is a perceived value and the ratio received by consumers. Pricing is a crucial part of the retail marketing mix because it will bring either profit or loss to the retailer, and it affects consumers' perceptions as well. According to Levy (2013: 414), there are 4 factors that affect retailers in setting prices: customers’ price sensitivity and cost, cost of the merchandise and services, competition Laws that limit pricing, retailers’ need to comply with legal regulations and ethical issues in price fixing. According Jobber (2010: 18), price affects the value customers perceive from buying products. Pricing is an important element that customers put into consideration when making a purchase decision. Price is a key element of the marketing mix because it represents, on a unit basis, what the company receives for the product or service that is being marketed. It is the only element of the marketing mix that creates revenue; meanwhile, all of the other elements represent costs. Communication Mix (Communication mix) A communication mix is an activity people use in order to communicate to others about the products or services they offer while convincing those who are offered. According to Levy and Weitz (2013: 183), the methods of communicating information to consumers in Edwin's research (2013) include (1) Advertising, (2) Sales promotion,) 3) Web site, (4) Community building, (5). Store atmosphere, (6) Personal selling, (7) Direct mail, (8) Word of mouth Store design and display According to Dunne, Lusch and Griffith (2002) in Edwin's research (2013), store design and display elements are important in the planning of a store. Strategies for store design and display elements include (a) layout, an interesting store arrangement, is to provide convenience for

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consumers, (b) signage and Graphics, ie signage boards and images such as paintings or photographs, (c) theme setting showing product offerings in available environments and atmospheres in store, (d) space management or arrangement of in-store items facilitating consumers (E) visual merchandising or a presentation of a store and merchandise in a way that attracts potential customers, (f) temperature, (g) colors and Lightning and (h) music Customer service (service) According to Levy and Weitz (2013: 220), customer service is a collection of programs and activities provided by the store or retailer to produce a better shopping experience. There are 5 perceptions used by consumers to evaluate customer service: by using service quality: tangibility focusing on physical appearance of facilities, equipment, personnel, and communication materials; empathy referring to concern and attention given to consumers such as personal recognition by name; Reliability providing consistent and accurate service as promised and in accordance with specified delivery time; responsiveness or willingness to help consumers and provide their services quickly and accurately such as calling back and sending emails immediately; and assurance (certainty) in the form of knowledge, ability and ethics of employees to convey trust and confidence Internal factors (personal psychological) According to Sumawan (2015), individual differences are the internal factors of individuals that arise from within the consumer and its psychological processes such as motivation, personality, self concept, management information and perception, and learning process External Factors (Socio-Cultural) According to Urfana and Sembiring (2013), socio-cultural factors can be interpreted as a means to do interaction between people in society. It has functions to regulate actions and actions as raised by individuals as members in a community According to Sangaji and Sopiah (2013), socio-cultural factors influencing customers’ purchasing decisions such as culture, demographic, social and economic characteristics, family, reference group, and technology Consumer behavior According to Schiffman and Khanuk (2010) in Suryani (2014: 14), consumer behavior is everything that they show in searching, buying, evaluating and spending products and services they expect to satisfy their needs. According to Hawkins and Mothersbaugh (2013) in Suryani (2014: 6), consumer behavior is a study about how individuals, groups and organizations and processes are undertaken to select, secure, use and discontinue products, services, experiences or ideas to satisfy their needs and impact to consumers and society. Consumer behaviour, according to James F.Engel et al. (2014), is defined as “the acts of the individuals directly involved in obtaining and using economic good services. This means that consumer behavior is defined as the actions of individuals directly involved in the business of obtaining and using economic services including the process of decision-making that precedes and determines those actions. Consumer behavior is a process that involves thinking, feelings people experience and the actions they take in the process of consumption. The American Marketing Association defines consumer behavior as the dynamic of the interaction between influence and awareness, behavior and the environment in which humans engage in aspects of life (Peter and Oslon, 2014: 6) Buying Decision According to Peter and Olson (2010: 160), purchasing decision making is an integrated process that is a combination of knowledge used to evaluate two or more behavioral alternatives and then choose one of them. Urfana and Sembiring (2013: 3) say consumer purchase decision is

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defined as a stage in the buying process where consumers finally actually make a purchase of a product or service. From these views, it can be concluded that consumers’ purchasing decision is a stage in the purchase process where consumers evaluate two or more alternatives in accordance with the value of significance of the purchase According to Adibowo et. al., (2012: 4), purchasing decisions can be measured by five indicators: purchasing decisions based on previous experience, Interest-based purchasing decisions, purchase decisions based on perceived risk, purchasing decisions based on the situation, purchasing decisions based on social outlook RESEARCH METHODS This research used a second order confirmation factor (CFA) model. Population in the research was infinite population, involving all visitors of shop X. Sampling method used was Convinience Sampling, Amirin, Tatang (2011), giving questionnaire to consumers who shopped in modern market X. For data analysis, this study used a Confirmatory factor Analysis second order. In this study, there were (Sugiyono, 2013) eight variables, namely, Location (X1), Merchandise (X2), Pricing (X3), Communication Mix (X4), Store Design and Display (X5), Customer Service (X6), Internal-Psychological (X7 ), External-Social Culture (X8). The eight research variables were formed based on the formulation of the problem and the theoretical basis ANALYSIS AND DISCUSSION Data analysis The test was performed on a latent formative second order construct by using t-statistic test through bootstrapping method. If the value of t-count was greater than the value of t-table (ttable = 1.96 with α = 5%) then the hypothesis was acceptable. Factors proposed in this study were as many as 8 factors, and the results are as follows

Figure 2. Model 2nd Order CFA Table 4. Path Coefficients Relations Communitaction Mix -> purcahing decision Customer Service -> purcahing decision Eksternal -> purcahing decision Internal -> purcahing decision Location -> purcahing decision

T Statistics (|O/STERR|)

Description

5.786.122 8.528.166 6.548.637 4.863.127 3.338.332

Significant Significant Significant Significant Significant

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Merchandise Assortment -> purcahing decision Pricing -> purcahing decision Store Design dan Display -> purcahing decision Source: Primary Data

6.210.565 6.784.854 8.058.903

Significant Significant Significant

Table 4 shows all the first order constructs significantly affected purchasing second order with T-statistics> 1.96. The dominant factors were customer service, store design and display, pricing, external, merchandise, communication mix and last internal The conclusion of the analysis is that all first order construct has significantly effected second order decision construct where T-statistic value generated for all first order construct was bigger than 1.96. This means that all first order collisions were construct-dimensional constructing purchasing decisions of the second order.

Discussion Location Forming a Purchase Decision In line with study by Arum (2016); Autami and Atmosphere (2015), location has a significant effect on purchasing decisions. Based on the results of the datam, location variables can improve the weaknesses that exist in the company which can be done through cooperation with Advertising and Public Transportation. Merchandise Forming a Purchase Decision The wide range of product categories and brands offered are Merchandise to make purchasing decisions. The wide range of products and brands range from food, fruits, household necessities, carpentry, clothing, item types (Retail Business, 2016). Strategies undertaken are to conduct a survey, benchmark and continuous evaluation. In so doing, the consumers’ perception about complete goods can give impacts on the stock management as well. So far, the range of all products has been uniformed based on groups of stores. This uniformly is likely to become the strength for being complete variety and range of products. However, in certain region, it is also necessary to deepen certain variety of products. Meanwhile, other categories need to be evaluated: which basic products are needed or not needed by the community. Based on this study, on average, employees have with expenditures below Rp. 800,000 per month. Their expenditures are usually arranged by their mothers. This condition will affect the turnover of merchandise in the store. Merchandise Flexibility and Promotion Merchandising is a thing worth noticing in a store. Sustainability in the store affects customers’ purchasing decisions. Customers may not purchase products at the forst time. However, when dispayed in interesting ways with good promotions (such as clearance sale, birthday, school holidays), this may affect their decisions to buy. In the meantime, this procedure has been implemented. However, this procedure has not been consistently carried out. Pricing Forming a Purchase Decision Facts has shown that little attention is given to Legal Rule that definitely affects people to purchase products. People often cancel their purchases. For that reason, it is important to do

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things certain measures such as Review Pricing, Price Image and analyze the implementation of Price Changing Communication Mix Forming Purchase Decision Facts known in the field about Communication Mix is still inconsistently carried out. Community Building is sometimes done as seen in the schedule of activities. The contrary is also true where people often neglect this program. However, when continuously conducted, Communication Mix can affect people’s purchasing behavior in the long term. Other indicators also need to be improved and developed again. Customer Service Forming a Purchase Decision Tangible factor is related to tidiness and cleanliness of employees. This procedure has been standardized and maintained during the training. Emphaty, Realiability and Assurance are still the general standards of service, and they can solve problems and foster sustainable relationships. Store Design and Display Forming Purchase Decision With regard to Store Design and Display Lay Out, the overall areas of the distance between the aisles need to be freed. In so doing, people can move with two trolleies. With the rest of the body size of normal people, consumers are free to shop. Goods should be neatly arranged in a group of similar areas in every aisle with accompanying board, helping consumers to read the notice from a distance. The music aspect in the store is calculated according to the theme. People also need to pay attention to the volume. Setting the temperature and well adjusted lighting during the morning, noon, and night are also the necessity. When consumers are crowded or quiet, the arrangement of the retailer side ahouls be appropriately arranged. Lighting and temperature effect to the costs incurred for electricity for lighting at peak loads. For exposure lighting in some areas, the light should be directly shone into the display products. It is good to make the product look fresh. This image should be consistently turned on. Similarly, the temperature is set in hours and hours of quiet hours, visual merchandising, and space management, signing and graphics. eme Setting is not maximal because it has not been set. Internal (Personal Psychology) Determining Customers’ Purchasing Decision This research is in line with the study by Arum (2016); Autami and Atmosphere (2015) who have proved Internal has a significant influence on purchasing decisions. The prevailing promotions have not been successful at motivating people to buy all products. They buy them because of their needs, capabilities, and interests due to the promotions of certain products such as rice, oil, sugar. As a result, X store should perform program evaluation in accordance with the needs and capabilities of consumers, and conduct further shopping survey as a mirror of personality and self-concept External (Socio-Cultural) Forming a Purchase Decision The study was conducted by Arum (2016); Autami and Atmosphere (2015) proves that External variables have a significant influence on purchasing decisions. There has been a shopping lifestyle trend in the modern market that people come to visit stores because of their friend’s invitation/social gathering clubs (arisan). These people have given references about stores. The need for kosher assurance to consume is also necessary to note which store X has not given much attention to. For that store X should expose existing products to display halal logo from MUI. This logo can be a guarantee to consumers, and it is likely to increase customers’ confidence to buy products.

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Conclusions and Recommendations From the result of discussion, it is concluded that 8 factors consist of customer service, store and design, pricing, external (social culture), merchandise, communication mix, internal (psychological), location factor shaping consumer decision in making a purchase. It is recommended further studies conduct periodic evaluations of eight factors. If there is a weakness of these 8 factors, immediate measurs can be taken. Otherwise, the neglegace will impact on the sales of stores X. Other researchers are also recommended to examine other variables such as brand awareness factor, loyalty factor that can determine customers’ purchasing decision. REFERENCES Amirin, Tatang M. 2011.Populasi dan Sampel Penelitian : Pendekatan Praktis : :Himpunan Jurnal Penelitian Yogyakarta: Penerbit Andi. Arum, Utami (2015) Pengaruh Bauran Pemasaran terhadap keputusan pembelian konsumen di minimarket kopma Universitas Negeri Malang Autami dan Suasana (2015), Pengaruh retail mix terhadap keputusan pembelian konsumen pada gerai Chatime Avijeet Singh Thakur (2013), A study on the Factors Influencing Consumer's Purchase Decision towards Smartphones in Indore Badan Pusat Statistik Kota Kediri (2015) “ Profil hasil pembangun Kota Kediri 2014” Berman, Barry & Evans, Joel R. (2010). Retail Management: A Strategic Approach (11th Ed.). New Jersey: Prentice Hall. Brigays, Helly (2013) Analisis Faktor - Faktor yang mempengaruhi konsumen d alam keputusan pembelian J.CO Donuts di Jakarta Barat Engel, James F., Blackwell, Roger D., dan Miniard, Paul W., Perilaku Konsumen, Alih bahasa Budiyanto, Binarupa Aksara, Jakarta, 1994 Jendi, Renfist (2012), Analisa Faktor Faktor yang mempengaruhi perilaku konsumen berbelanja di supermarket di kota Padang Levy, Michael & Weitz, Barton A. (2013). Retailing Management (9thEd.). New York: McGraw-Hill Irwin Marketing (2013). Brand Switching Analysis dalam Industri Ritel Modern. Retrieved March 10, 2013, from http://www. Marketing.co.id Peter, J. Paul dan Olson, Jerry C. Perilaku Konsumen dan strategi pemasaran, Alih bahasa Sihombing, Penerbit Erlangga, Jakarta, 1999 Sangadji, E.M., dan Sopiah. 2013. Perilaku Konsumen: Pendekatan Praktis. Himpunan Jurnal Penelitian Yogyakarta: Penerbit Andi. Sekaran, U. dan Bougie, R. (2010).Research Method for Business. UK: Wiley Setiwan, Nasrul.(2014). Teori Analisis Faktor, Statistik Ceria Sciffman, L.G., Kanuk, L.L. (2010). Consumer Behavior, (10thEd.). New Jersey: Prentice Hall Sugiyono (2013), Metode Penelitian Kuantitatif, Kualitatif dan R&D (19thEd.). Alfabeta, CV. Bandung Surmawan, Msc,: Prof. Dr. Ir. Ujang (2011), Perilaku konsumen teori dan penerapannya dalam konsumen (Edisi Kedua), Bogor: Ghalia Indonesia Urfana, M., & Sembiring, B. K. (2013). Analisis Pengaruh Faktor Kebudayaan, Sosial, Pribadi, dan Psikologis Terhadap Keputusan Pembelian Makanan Cepat Saji pada Konsumen Kentucky Fried Chicken (KFC) Walikota Medan. Media Informasi Manajemen , Vol. 1, No. 3, pp. 1-10.

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IMPACT EVALUATION OF SWM/SPS DEALERSHIP SYSTEM BY PT SIS TO PT RMBA Kuswana Rama Destian, 2David Sukardi Kodrat♠

1

Ciputra University Surabaya INDONESIA Email: [email protected] ABSTRACT This research is a qualitative research that will evaluate the outcome of the implementation of SWM/SPS System by PT SIS as the principal to PT RMBA as its network. This research will heavily put interview and internal data as its main resource since the implementation of the system have deep impact on both side. Also the interview will be done to 3 top management people from both companies. As the system implementation have a very big impact on PT RMBA’s distribution line, sales and its strategy of doing business, this reseach will have a lot of discussion on that matter. Key Words: Management System, Distribution Line, Sales, Network cooperation, Sales Strategy

INTRODUCTION PT Rama Mandiri Bangkit Abadi (hereinafter called PT RMBA) is a company engaged in motorcycle automotive which was established in 1996. PT RMBA used the name CV Rama Mandiri Motor (hereinafter called CV RMM) which do a business cooperation with Yamaha Motor Indonesia as Sub Dealer of PT Surya Timur Sakti Jatim. In its development, CV RMM cooperated with PT Indomobil Sukses International (Now PT Suzuki Indomobil Sales) as a partner of Suzuki Motor Corporation in Indonesia to sell Suzuki motorcycles by becoming a sub dealer of PT Indomobil Jakarta Motor Gemilang (which was then called PT IJMG) in 2002. It was till 2010 when CV RMM Changed the name to PT RMBA n PT SIS started the implementation of SWM/SPS dealership system. SWM/SPS (Suzuki World Motorcycle/Suzuki Premium Shops) is a system where resellers are given the opportunity to purchase units directly from the factory without having to go through the Main Dealer (Single Agent). The difference between SWM and SPS is from a minimum number of showrooms owned by resellers, where SWM must have at least 7 showrooms and SPS must have at least 2 showrooms. According to Kotler (2010: 113), distribution channels are an organization-dependent device that is covered in a process that makes the product or service to be used or consumed by consumers or business users. PT SIS tries to improve the quality of its resellers by including distribution cost difference to unit sales profit and spare parts which are expected to increase promotion activities at the local level. CONTEXT

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Suzuki World Motorcycle and Suzuki Premium Shop or commonly called SWM / SPS are a dealership system in PT SIS applied to the majority of provinces in Indonesia since 2008. SWM/ SPS system is intended to give more power to resellers to make sales and promotions in the certain region. The main change to this SWM / SPS system is cutting the distribution paths up to 2 steps. Before SWM / SPS system is implemented, PT SIS uses dealership-based dealership system. In addition, to conduct supervision of sales and promotion activities, PT SIS established a new division called Regional Office. Swhwarz (1985: 488) Saying that the optimal policy form can be complex, at any given time, the number of orders in one or more of the locations varies with time even if all relevant requests and factor costs are time varying. With the introduction of SWM and SPS systems and territorial constraints on the sales and development of the showroom network being abolished, resellers have the opportunity to compete in other areas within the SWM / SPS applied region or called open area policy. As explained by Kodrat (2009: 23), there are four uses for which this distribution channel influences. 1. Use value form It is a benefit created by changes of a product. There are not many changes to the value of the form with the change of Suzuki brand distribution line apart from the reduction of the previous postage through the main warehouse dealer and sub dealer. 2. Time value It is the availability of products when it is needed. At this point, with shorter distribution channels, the availability of goods in the market will be better because the delivery of goods is done directly to SWM / SPS. 3. Use place value It is the value of the goods or services depending on placement of the store itself. The process of new Suzuki distribution channel experienced a pretty good change with the cutting of postage from the manufacturer to the customer. 4. Use value of property It is an activity in the ownership of certain goods or services. In the old distribution process, the products move 4 times from the manufacturer, main dealer, sub dealer, to the customer. The new distribution line only have 3 moving process from manufacturer, SWM / SPS to the customer. From the point value, the change of the distribution system from the main dealer to SWM / SPS does not adversely affect Suzuki's business as a whole. It brings improvements in the distribution of products. However it the principles loss control of certain area which is caused by the open area policy. The change of the distribution channel and the cut off of PT SIS information line is the basis in the form of regional office and the impact on Suzuki reseller problem of Suzuki reseller. Problems faced by PT RMBA with the implementation of SWM / SPS System 1. Oversupply Disconnecting the information path and the establishment of RO caused a change in the negotiation of goods delivery initially based on sales capacity to be based on market projection. With the increasing number of motorcycle sales in Indonesia, motorcycle manufacturers are

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projected to increase sales every year. As regional supervisors and police, RO leadership always sets unit purchase targets with the expectation of an appropriate sales increase projected by the manufacturer. 2. Price and loss war Price wars are common in business competition when a product or service is competing in one market or adjacent territory. But there are several factors that actually exacerbate the price war in the market share of Suzuki motorcycles. - Brokers Brokers are people who earn income from commissions that are issued by resellers. In the absence of regional restrictions and over supply that occur on the reseller, the broker has the opportunity to conduct a mini commission auction on every transaction. - Salesman Broker Salesman is a person / party who know the work pattern of resellers and brokers. By relying on the knowledge, it is common for salesman from one reseller to be a broker of another reseller. Salesman knows the profit on each transaction. That is the reason why salesman Broker is more dangerous in creating a price war. Due to the ongoing price war and the factory's emphasis on making sales by shipping items beyond the reseller's capacity, it is often the resellers to sell off just to get the funds quickly. 3. Decrease in sales The backward impact of the above problems is that when the reseller has to stop selling loss practices, the sales that usually come from the broker are gradually lost. So also from salesmen who behave brokers. This has a significant impact on sales decline. RESEARCH METHODS RESEARCH SCOPE The scope of this research is limited to business process conducted by PT RMBA related to business cooperation with PT SIS and also the whole business process of PT SIS in sales and promotion of Suzuki motorcycle in East Java area. DATA TYPE Qualitative Data Qualitative data used are historical data of PT SIS development and also interview result with relevant source in this case leadership of PT SIS, PT RMBA and East Java Regional Office. Quantitative Data Quantitative data used are sales data, inventory goods and finance PT RMBA, Regional Office PT SIS and AISI related to the development of Suzuki reseller motor with the period 20132015. DATA SOURCE Primary data Primary data uses the interview result of PT SIS Director, East java RO’s Leader and Chairman of PT RMBA. Secondary Data Primary data uses historical data of PT SIS development, internal data of PT RMBA, Regional Office of PT SIS and AISI related to sale, availability of goods, finance and promotion. DATA COLLECTION TECHNIQUE Documentation Data were collected by collecting data related to sales, availability, finance and promotion of motorcycles owned by PT RMBA, Regional Offices of PT SIS and AISI.

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Interview Interviews were conducted with parties directly related to the policy of PT SIS and how PT RMBA accounted from that. RESEARCH INSTRUMENT The research instrument is a tool used in data collection to make the research becomes systematic and measurable. In this study, research instruments used are as follows: Interview guide The interview guide is a series of questions that guide the interview in conducting for a series of events or data that can be used in this study. Interviews Code Coding in qualitative research is intended to be able to organize and systemize data in full and detailed display so the data can bring topic projection. By then, the researcher will be able to find the meaning of data collected. Documentation of tools and documentation in the form of recordings Documentation tools and documentation in the form of recording is a collection of data that can be arranged systematically so that it can appear a conclusion that can be read and analyzed. Observation Guide Direct sensing of events occurring in business conduct over a period of time that can be used in research DATA ANALYSIS TECHNIQUE Data analysis techniques used in this study were conducted through several processes, namely: 1. Analyze supply issues by formulating negotiations based on supply chain management theory. 2. Analyze the issue of price wars with prices based on competition and reseller profits. 3. Analyze the problem of sales decline with the increasing number of orders and increase the sale of land. 4. Formulate and select alternative problem solving. 5. Conclusions and troubleshooting suggestions. RESEARCH FRAMEWORK This research is conducted by analyzing the context of problems arising from the implementation of SWM / SPS system and to verify the problems that arise. The context of the problem analyzed in this study is the explanation of the main dealers system and the SWM/ SPS dealership system. To understand the impact, it is necessary to understand what exactly the changes are that occur when the implementation of the new system, especially on the distribution of goods. In addition, in the application of SWM / SPS system, there is a change in the organizational structure of PT SIS that occurs within a short time and also in the form of regional organizations called regional offices. This change will also affect the Suzuki motorcycle business as a whole. After understanding the context of the problem, to proves the problem felt by PT RMBA with the implementation of SWM/ SPS system. It was proven by the instruments of research which are documentation, interview and observation. A clear picture and verification of problems arising from the application of SWM/ SPS system can be used as the basis for analysis of the findings of alternative solutions that can be taken by PT RMBA. Decision-making on the taken alternatives is done by looking at the proportion of advantages and disadvantages of each alternative.

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There are three problems in the context of the existing problems of oversupply, price war, and sales decline. The problems are then analyzed in accordance with the analysis related to the problem. The problem of over supply in SWM/ SPS is a problem that arises because the policy of purchasing order in which the deciding party is not the seller. Analysis and problem solving through a negotiation process based on supply chain management theory is needed for this problem. Based on the theory, it can be done by the reseller negotiations to PT SIS as a manufacturer to conduct a review to the distribution system of motorcycle units. It is necessary to conduct price policy according to competition among resellers and profits that can be gain from every sale. And on the problem of sales decline, the analysis of the number of orders and land selling need to see aspects that have not been done by PT RMBA. The results of the analysis of the problems that are based on the existing theories can be used as the basis for determining the problem-solving alternatives. These alternatives are then carried out the assessment of the advantages and disadvantages and assessed which alternative is most positive impact on the development of PT RMBA as a reseller of Suzuki motorcycles. ALTERNATIVE SOLUTIONS From the problems faced by PT RMBA with the implementation of SWM/ SPS system, there are 3 problems: 1. Oversupply 2. Price War 3. Decrease in Sales Based on those three issues, it is necessary to formulate alternative solutions that can answer the three problems. Each problem has an analysis in a different way. On the problem of oversupply, it needs an analysis using negotiation with supply chain management. In the price war issue, it is necessary to conduct a pricing analysis based on competition and profit calculation, and on the problem of sales decline, it is necessary to analyze the expansion for sale and addition of order quantity. SUPPLY CHAIN AMANGEMENT NEGOTIATIONS There are two alternative problem solving that PT RMBA can do to solve the over supply problem by using Negotiation on supply chain management. The first way is SWM / SPS collaboration and the second is territory control. SWM / SPS collaboration SWM / SPS collaboration is a dealership system whereby SWM / SPS in an area, for example East Java, together arrange for promotional items and sales policies before proposed or negotiated with PT SIS through regional office. This merging pattern can be done by meeting regularly every month to determine what policies will be taken related to the sale of promotions and the purchasing order. The results of the meeting are then submitted to the regional office and PT SIS and represented by the leadership of the SWM/ SPS which is appointed by the results of collaborative meetings. By uniting a voice in an area, the SWM/ SPS has a higher bargaining power when negotiating. Mastery of Territory The dealership scheme of the main dealer system is unlikely to be returned due to the location of SWM/ SPS mutually overlapping in all regions. But SWM / SPS function can be equated with main dealer by giving control of a region to one SWM/ SPS. By becoming a regional ruler, PT RMBA can gain more bargaining power because sales and promotional activities in that area are only done by PT RMBA.

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PRICING BASED ON COMPETITION AND PROFIT CALCULATION There are two problem solving alternatives that PT RMBA can do to set prices based on competition and profit calculation. The first is an external price fixing with a price equalization agreement with SWM / SPS throughout East Java and internally by setting a broker fee for each sale made by PT RMBA. External Price Pricing External price pricing by engaging in price equations is an agreement with other SWM / SPS by setting Surabaya area’s profit as profit standard. With this price equation, SWM / SPS can focus more on competition to other brands rather than the competition between SWM / SPS itself. Internal pricing Internal pricing by setting the broker fee is a way that can be done by PT RMBA to face price competition that occurred. By doing a fix fee that can be given to the broker and provide a container for the brokers on the move, then they are indirectly in control and maintained. This method can also help PT RMBA increase sales if the brokers form a strong network in the area of PT RMBA. This provision is adjusted nominally in accordance with the value of the merit of a sale and the value is made into a provision that cannot be changed. SALES EXPANTIONS AND INCREASE THE PURCHASING ORDERS The first is the addition of sales by doing business to business sales with sales agencies and sales in a business to customer by establishing or opening a new showroom. Business to Business (B2B) Business to Business sales can be in the form of agency sales performed by PT RMBA to other organizations such as banks, schools or factories. This sale is usually initiated by the announcement of an organization to the surrounding motorcycle salesman about the large purchases that the organization will make. Then the sellers / dealers will send their offer in the hope that the organization will make their purchase on one of the sellers. Unlike sales through leasing, agency sales are sales where Suzuki Honda and Yamaha have the same bargaining power because the main factor is the margin given by the factory that ranges from 9-10%. PT RMBA can increase its sales by forming a new division that is tasked specifically to search for organizations that will make purchases of motorcycles in large quantities. Business to Customer (B2C) B2C sales can be done in many ways one of them is by the addition of new exhibition space inside and outside the selling area of PT RMBA is still in the selling area SWM / SPS East Java. This step will certainly increase sales because with the addition of showrooms then PT RMBA will directly get sales from the area where the showroom was established. CONCLUSION The research conducted in this thesis entitled “Impact Evaluation of SWM/SPS Dealership System by PT SIS to PT RMBA. This study is intended to better understand problems of the system implementation and provide solutions to the problem. Researcher finds various problems related to the implementation of SWM / SPS dealership system by PT SIS to PT RMBA. The problems are: 1. Oversupply This problem caused PT RMBA to overdrive that occurred after the implementation of SWM / SPS dealership system where the number of goods in the year 2013-2014, not in accordance with the situation in the SWM / SPS. 2. Price and loss war Price war occurs because of competition between SWM/ SPS caused by the opening of the territory. In addition, the regional office does not set a pricing policy that binds SWM/ SPS. However, this competition not only applies to the same product but also

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applies to the exact same product as the competition between SWM/ SPS in selling FU 150 Satria. 3. Decrease in sales The decline in sales that occurred on Suzuki motorcycles is the instability of PT SIS organization after the implementation of SWM / SPS system. Of course this factor cannot be controlled directly by PT RMBA. However, this sales decline can be overcome by increasing the sale land and increasing the number of orders. The solutions - solutions to face problems faced by PT. RMBA with the application of SWM / SPS system by PT.SIS among others are: 1. There are 2 alternative problem solving that PT RMBA can do to solve the over supply problem by using Negotiation on supply chain management. The first way is SWM / SPS collaboration and the second is territory control. 2. There are two alternative problem solving that can be done by PT RMBA to set price based on competition and profit calculation. The first is an external price fixing with a price equalization agreement with SWM / SPS throughout East Java and internally by setting a broker fee for each sale made by PT RMBA. 3. There are two alternatives that PT RMBA can make to increase sales with the expansion of the selling area and the addition of the number of orders. The first is the addition of sales by doing business to business sales with sales agencies and sales in a business to customer by establishing or opening a new showroom. REFERENCE Aldi, Adirama (2012) Pengaruh Citra Merek dan Kualitas Produk Terhadap Keputusan Pembelian Konsumen (Studi Kasus pada Konsumen Sepeda Motor Satria FU di Klaten) Andam, ZR, 2003, e-Commerce and e Business,www.businessonline.com/php/articleonline, Tanggal akses 17 Mei 2011 Dhamayanto, R. Analisis Faktor – Faktor Yang Meningkatkan Loyalitas Employer Pada Situs Online Recruitment. Tesis. 2008 Hasibuan, H. Malayu S.P. Jakarta : Bumi Aksara, 2003, 2005 Manajemen sumber daya manusia Jalbar A.B., Gutie´rrez J., Puerto J., Sicilia J., 2003. Policies for inventory/distribution systems: The effect of centralization vs. decentralization. International Journal of Production Economics, 81–82. King, Ronald R.; Smith, Vernon L.; Williams, Arlington W.; van Boening, Mark V. (1993). The Robustness of Bubbles and Crashes in Experimental Stock Markets. In Day, R. H.; Chen, P. Nonlinear Dynamics and Evolutionary Economics. New York: Oxford University Press Kodrat, David Sukardi. (2009) Management Distribusi, Old Distribution Channel and Post mo Distribution Channel Approach. Graha Ilmu: Surabaya. Kotler, Philip. (2010) Manajemen Pemasaran, Analisis Perencanaan, Pengendalian,Prentice Hall, Edisi Bahasa Indonesia, Jakarta: Salemba Empat Kotler, Philip. Susanto, AB. (2007) Manajemen Pemasaran Indonesia.Buku 2.Jakarta: Salemba Empat. Maribun, B.N (2003) Kamus Manajemen, Jakarta: Pustaka Sinar Harapan. Oktaviani, Analisis Startegi Bisnis PT XYZ dengan Menggunakan Analisis SWOT, UG Jurnal Vol. 5. No. 12 Raju, J., Zhang, Z.J. (2010) Smart Pricing: How Google, Priceline, and Leading Business Use Pricing Innovation for Profitability. FT Press.

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Rayport, J.F dan Bernard J. Jaworski, Introduction toe-commerce, Boston: McGraw Hil Schwarz, L.B., Deuermeyer, B.L., Badinelli, R.D. (1985) Fill-rate optimization in a onewarehouse Nidentical retailer distribution system. Management Science 31, 488–498 Tjiptono, Fandy (2008) Strategi Bisnis Pemasaran. Andi.Yogyakarta Zachariassen, Frederik (2008) Negotiation strategies in supply chain management, International Journal of Physical Distribution & Logistics Management, Vol. 38 Iss: 10, pp.764 - 781

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LEADERSHIP ROLE AND ORGANIZATIONAL CULTURE IN THE SUCCESSION PLANNING OF PT DABN Shinta Nastiti, 2Hermeindito♠

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Ciputra University Surabaya INDONESIA ABSTRACT This research aims to describe the role of leadership and organizational culture in the succession planning of PT DABN. The background of this research is to illustrate the company’s needs about what kind of leadership roles and organizational culture which can be applied in PT DABN's succession planning. But still, there are several things that do not fit with current circumstances, so they need a concept of leadership roles that suitable with the organizational culture. The prospect, after the result is out, will be used as a reference for the leadership in next generation (succession). This research is done by using qualitative research and interview methods. The result of this research proves that leadership roles has been going well, but there are several things that hasn't run optimally, such as the communication sector, the willingness from the leader to educate his employee, and founder's mentality towards the company's employees. The organizational culture in PT DABN hasn't run optimally yet because of the SOP and lack of evaluation from the leader. Coaching and rewarding aren't fully granted. The successor already has an ability to be a leader, but he must learn more and needs motivation to increase his desire to learn. Keywords: Family business, leadership’s role, organizational culture, succession, founder’s mentality

INTRODUCTION Family enterprise is a type of company that has big contribution in the global economy, especially in Indonesia. An organization is called a family enterprise when there is an involvement of two generations in the family that give influences in family policies. (Donnelley, 2002 and Susanto, 2007 in Mustamu, 2015). According to The Jakarta Consulting Group, 88% of private companies in Indonesia are family enterprises. This is showing that family enterprise has a really big role in the economy. The successful achievement that has been achieved by the family enterprise can increase the job opportunity in a country. As the founder of their company, they definitely want their company to last for a long time. Hence, many of them engage their family members to do the business together in the company in order to have a successor of the business that has already built (Novalia, 2016). According to Susanto et al (2008), one of the issue in family business that is important to be noticed is about succession. Succession is a leadership and ownership transition from the old generation to the younger generation. The emerging issues in succession is the unclearness of the succession plan and the conflict between the candidates of the successor. The matter that

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must be noticed in the succession plan is this leadership transition must not produce any obstacles in the business activity, which can bother the company’s business performance. PT DABN was founded on April 27, 2000 in Surabaya, started by its founder as the contractor for underwater work. The founder of this company is Mr. B. Haryono (59). He has a son named Mr. DK (37) and two daughters named Mrs. EN (35) and Ms. SN (22). Mr. B. Haryono is already near to the retirement age, so he needs to think about the leadership transition in the company. Besides, his children have been mature enough to continue the leadership and becoming his successor. Because this company is a family business, so in his leadership, Mr. B. Haryono applies some of the family cultures in the work circumstances. However, there are some unnecessary matters which didn’t fit with the condition inside the company. So that, we need a leadership concept based on the leadership theory and organizational culture. After getting the result, we can apply it as the reference for the next leadership. LITERATURE REVIEW Succession in the Family Enterprise According to Susanto et al (2008), one of the issue in family business that is important to be noticed is about succession. Succession is a leadership and ownership transition from the old generation to the younger generation. The emerging issues in succession is the unclear succession plan and the conflict between the candidates of the successor. The matter that must be noticed in the succession plan is this leadership transition can’t result obstacles in the business activity, which can bother the company’s business performance. Succession is a really important stages and become the determinant for the family business. According to Brockhaus (2004) in Prasetya and Mustamu (2014), something that matters in the succession is the family’s attitude. If the family doesn’t support the successor, it will give a bad impact for the family business. Succession Planning in the Family Enterprise Succession planning is started with determining the criteria. Alcorn (1982) in Theresa and Mustamu (2015) said that there are some criteria needed by the candidates of the successor, they are (1) the ability to adapt, (2) having interest and participation, (3) having a vision for the company, (4) having empathy, (5) having competency with knowledge, skill, and high performance, and (6) having passion. Leadership in the Family Enterprise Parallel with the business and management world development, including the leadership theories, a family enterprise needs to apply a more universal leadership concept. The Jakarta Consulting Group developed Quantum Leadership Concept which is very relevant if we apply it in the family enterprise. There are three basic philosophy of Quantum Leadership Concept: 1. Leadership Roles to See, Dream, and Perform A leader shall understand the reality inside and outside the company, accept the situation and circumstances, and also making a future goal based on this reality. 2. Leadership Roles to Change A good leader will guide the followers to make them a good leader for their selves. 3. Leadership Roles to Drive A Quantum Leader shall think about the direction that will be chosen for achieve a vision, and estimating how far they will go to achieve the vision and doing the right things. Organizational Culture

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According to Azanza et al (2013), organizational culture is the set of shared values and norms that controls organizational members’ interactions with each other and with people outside the organization. The organizational culture is linked with the employee’s work satisfaction, leadership, and organizational effectiveness. Miller (1984) said that an effective company is a company that cultivate eight cultural values called principles, they are (1) aim principle, (2) excellence principle, (3) consensus principle, (4) unity principle, (5) performance principle, (6) empiricism principle, (7) intimacy principle, and (8) integrity principle. If Indonesian companies can use those principles, it will create an effectiveness, productivity, and efficiency that can give positive impacts for the society. Founder’s Mentality Founder’s mentality is the key from the competition among young companies to become a bigger companies. However, how big the company will be, if they have founder’s mentality, they will always be obsessed to be the front guard of their company, having a full responsibility towards the employees, products, customers, and also the decision for the business. RESEARCH METHODS This research used qualitative methods, where this research has an aim to understand a phenomenon in the social context that putting the communication and interaction forward between the researcher and the objects of the research (Herdiansyah, 2012). This research took place in Surabaya, where PT DABN is located, and the researcher did the research for 10 days. The sampling method that was used for this research is Non Probability Sampling, where the individual or the population unit doesn’t have the same probability to be chosen. There are certain considerations for choosing the sample (Herdiansyah, 2012). The unit of analysis that is used in this study is the individual (informant). Individual analysis units are selected to explore individual knowledge and opinions as supporting data in the analysis. The informants used are the owner of PT DABN, the successor of PT DABN, an employee of PT DABN, and an expertise in Human Capital Management. Data collection methods in this study using data promer and secondary. Primary data is data obtained by self through interview and observation. Secondary data, ie data obtained from second source through document / literature study. Data analysis from this research is done by analyzing every aspect that is studied, those are leadership’s role, organizational culture, and succession. The data can be declared valid if there is no difference between the reported by the researcher with what actually happened to the object under study. According to Yin (2009), there are four kinds of testing to validate data through construct validity, internal validity, external validity, and reliability. RESULTS AND DISCUSSION Leadership From this research, we got the results as follows: Theory that has been applied Advantages Leadership’s Role to See, Dream, and Perform Leadership’s Role to Drive Lack

Leadership’s Role to Change Founder’s mentality

Explanation Having colleagues and networking to obtain the project PT DABN is one of the biggest underwater company in Indonesia One way communication from the leader to the employee The employee doesn’t have owner’s

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mindset PT DABN has already been trusted for handling 50 national and international projects for 17 years after it was founded. The vision of PT DABN is to become a salvage and underwater services company in Indonesia that can be trusted in national and international scale. With that vision, Mr. B. Haryono attempts to achieve it by doing the required stages and looking at the future to develop the company to be a better company. This matter is fit with a theory from The Jakarta Consulting Group where Mr. B. Haryono has already done his role as a leader that can build his imaginary building about the organization’s future and stand on the reality. It can be seen from the amount of projects that were offered to PT DABN because of their “good image” and big network. Something that is need to be fixed from the leadership in PT DABN is the communication between leader and employees. As it happens in PT DABN, the leader assumes that he has already done the best and giving discretion to his employee to make innovations, but the employees still think that this leadership still come from the leader itself. By widening the communication, they can reduce the misunderstandings between the leader and employees. A small company has a few advantages from a few sides. Employees in a small company can make a decision when they have something called owner’s mindset (Zook and Allen, 2016). However, the condition in the company is showing the absence of this mindset. A company has an owner’s mindset when the employees have a feeling to own the company and want to make this company bigger. But, the condition in PT DABN is the employee still obey their leader’s words and do not make much innovation and giving a suggestion in management sector. However, for the technical sector, the employee has already decided the right decision but still have to get the permission from the leader. Organizational Culture From this research, we got the results as follows: Theory that has been applied Advantages Aim Unity Empiricism Integrity Intimacy

Lack

Excellence Consensus Performance

Explanation Providing a high quality service for the consumer Fair treatment between the employees Using the work report and statistic data to do the activity Doing the best in service Good relationship between the employees Everything still depends on the leader The reward and incentive still not optimal enough

In PT DABN, there is a Standard Operational Procedure (SOP) setting a few of cultural things in the company, such as wearing uniform. But in the office, the employees still rarely wear the uniform. This happens because of the office is located in a house and a visitor or people rarely come to the office except the employees, so they don’t obey the rule of wearing uniform. Not only the employees, even the leader still doesn’t implement the rule that is written in the SOP. This doesn’t fit with the organizational culture’s theory where the leader shall become the example for the employees. It’s a small matter but it’s really important to do the small thing that will be followed by the bigger things and give a big impact for the company (Tan, 2002). Besides, excellence is needed to be upheld in an organization to make the employees more creative and innovative in doing their works. This is important to create the other principles to

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be a primary value in the company that will become an organizational culture (Sutrisno, 2010). According to Want (2006), there is a leader that has a thought that coaching is unnecessary. It will make the organization development and also the people inside it developing slower. Therefore, coaching and calling the expertise are needed to develop the company’s employee and the company itself. So far, there are some trainings that had been given to the employee, such as SOP training and Safety training. But in fact, the application of this training is still lacking because of the less control and the evaluation from the leader. Besides, there are many trainings needed by the employees, for example: technical training such as Basic Sea Survival, Non Destructive Test, etc. Succession From this research, we got the results as follows: Theory that has been applied Advantages The ability to adapt Having interest and participation Having a vision for the company Having empathy

Lack

Having competency knowledge, skill, and performance Having passion.

Explanation Familiar with the situation of the company and the employees Having a vision to make the company bigger and reaching a higher standard Putting himself in the other people’s position and understanding what the other people need with The candidate of the successor is still high less learning

This year, Mr. B. Haryono has already engaged his successor (Mr. DK) to identify the company’s circumstances. It has a purpose to make the successor having an ability to adapt and growing his participation in the company. However, from the research that has been done, Mr. DK is still less learning in order to make himself ready as the successor. In a fact, from 50 projects that has already done by PT DABN, Mr. DK led the latest 2 projects. All this time, he still be the “assistant” of Mr. BH as the leader of PT DABN. Mr. DK is the operational director that is responsible for the operational matters in the site project. But for the technical matters, Mr. DK only knows about the “wrap”, that’s why he needs to learn more in order to master all of the company matters. This is really needed because as the successor he must be the one who knows the most about how the company works, in technical matter or management matter. All the decisions will be put on his hand. But Mr. DK has a big vision for the future of PT DABN, i.e. make PT DABN better known with completing the company with the certification in several sectors. The vision in a company is really important because it can reflect that this company has an identity and knows the direction where it will be brought. The establishment of a family business depends on the readiness of the old generation to prepare the young generation to continue the leadership (Soedibjo, 2012). Succession Planning After we are done with the result, there are some planning in order to make the succession in PT DABN succeed. 1. Pre Succession of PT DABN Component Explanation Leadership’s Role The successor has followed the activity in the company as an operational director

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Organizational Culture

2. The Process of Succession of PT DABN Component Leadership’s Role

Organizational Culture

3. Post Succession of PT DABN Component Leadership’s Role

Organizational Culture

Introducing the work circumstancess and networking to the successor Collecting the evaluation about organizational culture (regulation, SOP of machine and technical matters, and the work circumstancess) Explanation Involving the successor in the project technically Involving the successor in the training, technical or management matters Accompanying the successor in order to increase the awareness from the successor about the company Evaluating SOP for performance and regulation of the company Initiating the family meeting Making family policies Explanation Increasing the skill and performance of the successor Having a retirement plan for the successor Successor’s commitment for leading the company The first generation and the successor have the same vision about future innovation Fixing the communication between the first generation and the successor Still accompanying the successor from the first generation in order to bring the company to a better future Making the job description’s distribution more clearly and adjust with the sector, but still help each other (watch the limitation) Making a new SOP along with the company development, in technically procedure and administrative sector. Giving incentive and reward to increase the employee’s loyalty and strengthen the relationship between the employees.

CONCLUSSION Leadership’s Role The result of this research proves that leadership’s role has been running well, but there are still a few things that has not run optimally, i.e. in communication sector, leader’s desire to make the employees intelligent, and also to increase the founder’s mentality in the company. Organizational Culture

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According to the result, the organizational culture in PT DABN hasn’t run optimally because the SOP hasn’t done well and less evaluation from the leader. Besides, there are less coaching and rewarding for the employees. Succession The result of this research shows that the successor has a basic to be a leader. But in fact, the successor is still less learning and needs more motivation to increase his interest in learning. REFFERENCES Agusta, L. & Sutanto, E.M. (2013). Pengaruh Pelatihan dan Motivasi Kerja terhadap Kinerja Karyawan CV Haragon Surabaya. AGORA Vol 1 No 3. Arini, M. (2013). Pengaruh Budaya Organisasi , Komitmen Organisasi terhadap Kepuasan Kerja dan Dampaknya pada Kinerja Karyawan (PT. X Surabaya). Surabaya : Universitas 17 Agustus 1945 Azanza, G., Moriano, J.A., & Molero, F. (2013). Authentic Leadership and Organizational Culture as Drivers of Employee’s Job Satisfaction. Journal of Work and Organizational Psychology 29: 45-40. Fishman, Allen E. (2009) 9 Elements of Family Business Success. United States of America: McGraw-Hill Hoch, J.E. (2013). Shared Leadership and Innovation: The Role of Vertical Leadership and Employee Integrity. Journal of Business Psychology 28: 159-174. Imran, H., Arif, I., Cheema, S., & Azeem, M. (2014). Relationship between Job Satisfaction, Job Performance, Attitude towards Work, and Organizational Commitment. Entrepreneurship and Innovation Management Journal Vol 2 Issue 2 (May 2014): 135144. Lily, F. & Praptiningsih, M. (2014). Perancangan Model Suksesi yang Efektif pada Perusahaan Keluarga PT. ABC. AGORA Vol.2, No.2. 2014. Lina, D. (2014). Analisis Pengaruh Kepemimpinan dan Budaya Organisasi terhadap Kinerja Pegawai dengan Sistem Reward sebagai Variabel Moderating. Jurnal Riset Akuntansi dan Bisnis Vol 14 No 1, Maret 2014. Prussia, G.E., Hassan, S., Mahsud, R., & Yukl, G. (2013). Ethical and Empowering Leadership and Leader Effectiveness. Journal of Managerial Psychology Vol 28 No 2 (pp. 133-146). Sari, Y.K. (2014). Pengaruh Kepemimpinan, Motivasi, dan Disiplin Kerja terhadap Kinerja Karyawan pada PT. Patra Komala di Dumai. Jurnal Tepak Manajemen Bisnis, Vol VI No 2 (2 Mei 2014). Soedibyo, Mooryati (2012). Family Business Response to Future Competition. Jakarta: PT Gramedia Pustaka Utama Suryanto, W. & Ardianti, R. (2014). Proses Suksesi dan Performa Paska Suksesi pada Perusahaan Keluarga (Studi Deskriptif pada PT. Panca Duta Buana). AGORA Vol.2, No.2. 2014. Susanto, A.B., Wijanarko, H., Susanto, P., & Mertosono, S. (2014). The Jakarta Consulting Group on Family Business. Jakarta : The Jakarta Consulting Group. Theresa, Y. & Mustamu, R.H. (2015). Analisis Pelaksanaan Suksesi pada Perusahaan Konstruksi. AGORA Vol.3 No.1. 2015. Wibowo, U.B. (2011). Teori Kepemimpinan. Yogyakarta: Badan Kepegawaian Daerah Yogyakarta. Zook, C. & Allen, J. (2016). Founder’s Mentality. Boston: Harvard Business Review Press.

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THE ANALYSIS OF BRAND BUILDING FACTOR OF TEA PRODUCT IN SURABAYA ¹Alfy Wahyu Pramita Sari, ²Tina Melinda♠ Ciputra University Surabaya INDONESIA Email: ¹ [email protected], ² [email protected] ABSTRACT The aim of this research is to test the variables formers of tea products’ branding in Surabaya. The investigated variables in this research are packaging variable (X1), product quality variable (X2), and price variable (X3). The packaging variable has four indicators such as materials, logos, colors, and sizes. The product quality variable has four indicators such as product durability, product conformity, design variation, and comfort of use. The prize variable is also has four indicators such as prize affordability, prize conformity with the quality, prize conformity with the benefit(s), and prize competitiveness. This research uses a confirmatory factor analysis as the measuring instrument. The populations of this research are Surabaya citizens who consume 60 teas. There are 53 respondents as the samples taken by non-probability sampling techniques by using purposive sampling method. The analysis result shows that the biggest determinant indicator of the prize variable is the prize conformity with the benefits, followed by the biggest determinant indicator of the packaging variable which is colors, and the biggest determinant indicator of the product quality variable is comfort of use. Keywords: branding, packaging, product quality, prize

INTRODUCTION Advertisement is a promotional program to inform any information regarding a product to costumers which has to be done effectively and efficiently because it would be one of the determinants in increasing selling besides product quality, price, customers service level and seller capability. The way to delivers advertisement to customers can utilize some media such as printed media, television, radio, billboards or banners. Advertising is one of the ways where a brand can be seen and will be impacted on a tendency to be bought. In Indonesia, there is an institution that surveys brands and determines the top brand award, which given to the best brands based on customers’ choices. According to the Top Brand Award official website in 2016, the top brand award for food and beverage category such as ready to drink packaging teas are given to Teh Botol Sosro in the first position, then followed by Teh Pucuk Harum as the second position, and Teh Gelas as the third. The criteria determination to win the Top Brand is the customers’ choices through the survey by looking at the three parameters such as Top Mind of Share, Top of Market Share, and Top of Commitment Share. In 2012, still in the Top Brand Award official website, Sariwangi wins the food and beverage category for tea bag by 81% and becomes the only one top brand in this category at that time.

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Akar Pulung is one of the companies which produces food and beverage products. Akar Pulung started to produce food and beverage since 2010. Akar Pulung produces new product that is fragrant tea shaped in tea bag and brewed. This product is produced to meet the market’s demand that does not prefer the herbs flavour which is contained in the previous herb tea product. It is important to analyse the factors which building a brand in order to boost sales and introduce Akar Pulung products to public. Simamora (2002) stated that the existence of a brand has a benefit for buyers, society and sellers. The benefits for the buyers are to image the quality and help in giving attention to new product that might be useful for them. Hence, strengthening Akar Pulung products’ brand is the right market strategy to compete with other companies. Supported by the previous researches about the factors that influenced by tea brand, thus in this thesis the researcher examines the Analysis of Brand Building Factors of Tea Product in Surabaya to find out what the factors and the indicator which have been occurred before it can be applied in this research. LITERATURE REVIEW Previous Research Sigh and Dr. Anita (2012) wrote a research journal Consumers Buying towards Branded Tea’s. This research examined the customers’ behaviour towards the purchase of the tea brand. It was conducted in India where tea was a popular beverage. This research connected the branded teas with the local product teas. The result showed that all level of tea penetration in India reached 77.2 % in average and the result was also showed that price; gift, scheme, brand, quality standards, packaging, consumption intensity, attractive facilities, and customers’ awareness are the important factors which influence the customers’ behaviour towards the purchase of the tea brand. Brand American Marketing Association (AMA) defines brand as a name, term, sign, symbol or design, or combination of all that aimed to describe a stuff or service and at the end can distinguish itself with others (Kotler, 2002). Brand image, according to Buchari (in Octaviana, 2016), image is an impression which thought and known by someone or a group about a good thing of a company or its products. Tjiptono (in Octaviana, 2016), stated that brand image is a set of confidence, ideas and impressions which owned by someone toward an object. Amstrong and Kotler (in Octaviana, 2016) said that brand as a name, term, sign, symbol or design, or combination of all that intended to identify of the competitors’ stuff and services and a certain form of a meaning trace which left in customers’ mind. There are some supported factors that building brand image, such as favourability of brand association, strength of brand association, and uniqueness of brand association (Keller in Ferriadewi, 2008). According to Ambadar (2007), there are two brand functions: identifying a product, thus the customers recognize diverse trademarks and helping to get the potential buyers. Brand Trust According to Costabile research (in Ferinnadewi, 2008), brand trust is a perception of the reliability from customers’ perspectives based on the experiences, or more on the transaction sequence or interaction which characterized by the expectation achievement of product performance and satisfaction. According to Kustini (2011:23), brand trust can be measured by dimension of viability and dimension of intentionality.

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Brand Strategy According to Schultz and Barnes (in Wibisono, 2010), brand strategy can be defined as a brand management where there is an activity that organises all elements which aimed to build a brand. Brand strategy is included brand positioning, brand identity, and brand personality (Gelder, in Wibisono, 2010). Schultz and Barnes (in Wibisono, 2010) were also added that brand communication is also included as brand strategy. Brand Awareness According to Aaker, brand awareness is the strength size of a brand existence in customers’ mind. Brand awareness includes Brand Recognition (a brand that has been known by the customer), Brand Recall (a brand that has been recalled by the customer for a certain product category), Top of Mind (the first brand that has been mentioned by the customer as a certain product category), and Dominant Brand (the only brand that is remembered by the customer). Marketing Mix Kotler (2012:101) stated that marketing mix is a set of marketing stuff which used by a company to achieve the marketing goal in the target market continuously. It can be classified become 4P; Product, Price, Place, and Promotion (Kotler, 2011:181). Packaging Packaging is a process which related to the container or wrapper design and production of a product (Tjiptono, 2002:151). According to Kotler, there are four packaging functions as a one of the marketing stuff, such as self-service, consumer affluence, company and brand image, innovation opportunity. The packaging indicators which used in this research refer to Kotler and Wirya such as: 1. Material: There are several kinds of material which used for packaging, such as paper, glass, aluminium foil, plastic and metal. 2. Logo: A trademark or company logo has an important role to improve packaging for examples are communicative, symbol identity. 3. Colour: Customers are pay attention to colour rather than shape or form, and colour is the first thing that is displayed in a product. 4. Size: Packaging size is depended on the kind of product that wrapped, whether the length, width, or thinness and thickness of the packaging. Tea Tea (Camellia sinensis) is a branched herbaceous plant which has a round stem. The leaves are ovalis with serrated edge. The leaves colour is green and glossy. The tea flowers are white in the leaf axil and scented aromatic. The fruit is round. Before cooked and become brown, the fruit is green (Mursito in Daroini, 2006). The chemical composition in tealeaves is influenced by the quality of tea produced. Those chemical components are directly influenced against colour, flavour, and the tea steeping stimulation (Nasution and Tjiptadi, in Daroini, 2006). In Indonesia, there are three kinds of tea based on the process, such as black tea/fermented tea, green tea/unfermented tea, and jasmine tea. RESEARCH METHODS This research is a factor analysis research. Factor analysis is a multivariate statistic technique which applied to examine the connection of variables that has interdependency relationship. This research uses second order confirmation factor analysis (CFA) model. This model is a measurement model where the main factor is measured by a number of indicators based on some indicators (Dachlan, in Juanda, 2005).

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The questionnaire of this research is conducted in Surabaya. The research is conducted during June 2016 until May 2017, whereas the data collection is conducted in March 2017. The target population in this research are 60 respondents of tea customers who are living in Surabaya. The samples of this research are 53 customers who have been drinking tea. This research applies Non-probability sampling technique and purposive sampling method with the inclusion criteria of tea customers and live in Surabaya. The sources of data in this research are references which used from branding and respondents’ questionnaire. Then, for the data collection uses quantitative data in form of numbers that processed using mathematic calculation technique. The data collection is conducted by distributing questionnaire to the respondents. This research focuses on finding out what factors that build a tea branding. The researcher expects that this research can be applied by tea products’ companies for branding their products to be more known by public and can compete with other competitors. The data analysis of this research uses second order Confirmatory Factor analysis (CFA) with Partial Least Square (PLS) because the samples used are less than 100. There are two analysis steps in this research, the first analysis is done from dimension latent construct to the indicators and the second analysis is done from latent construct to the dimension construct.in analysing second order CFA, it is suggested to apply repeated indicators approach or also called hierarchical component model (Ghozali, 2015). Reflective indicators is evaluated through the convergent validity and discriminant from the indicator which forms latent construct and composite reliability also cronbach alpha for the indicators block (Chin, in Ghozali, 2015). The first testing step is conducted on first order reflective indicators by using convergent validity test (loading factor, AVE, and communality), discriminant validity, reliability (cronbach’s alpha and composite reliability) and reflective indicators hypothesis by using outer loading test. The second testing step is conducted on second order formative construct by using t-statistic test through resampling method (bootstrapping). This research uses 5% level significance so if t-statistic value is more than t-table (t-tabel=1.96 with alpha=0.05) thus, it can be concluded that the formative indicators are valid. RESULTS AND DISCUSSIONS The Packaging Variable of Brand Building The research data discovers that the lowest factor loading value of packaging variable (X1) is found in indicator (X1.3) which discusses packaging colour has the lowest value, means that the respondents’ answers at that question are the most homogeneous. Based on the average value in every indicator of packaging variable, the result of X1.1 or material indicator has the highest value while in X1.3 or colour indicator has the lowest value. Thus, it can be assumed that respondents or tea customers mostly prefer a product with safe and practical packaging to be consumed. The occurring conclusion about packaging variable of brand building supported by previous research, explained that packaging variable is significantly influenced in building purchase decision of a brand (Singh, 2012). “Packaging is common activities in stuff planning which involves design determining and wrapper or packaging making of a stuff” (Kotler, 1999:227). Packaging is a process which related to container or wrapper designing and making of a product (Tjiptono, 2002:151). Packaging as early market media can be seen first by the customers. It becomes an early opportunity to build brand of a product for the early presentation. In this globalisation era, an interesting presentation can be attraction and characteristic of a product, so customers can remember that product.

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This fact supports the theoretical fact and indicators that used in this research. There are several aspects which build branding of packaging variable such as material, logo, colour, and size of the packaging. The result of this research reveals that packaging variable is significantly influenced in building branding of tea product. Due to those aspects are included in packaging variable and build branding, so companies in branding a product to create a right and effective branding strategy as requirement by the customers and happening trend should consider those points. The Product Quality Variable of Brand Building The research data discovers that the lowest factor loading value of product quality variable (X2) is found in indicator (X2.4) which discusses the comfort of use has the lowest value, means that the respondents’ answers at that question are the most homogeneous rather than other indicators in product quality variable. Based on the result of respondents’ answers, mostly the respondents agree that good product quality will build branding of that tea product. Yet, some respondents have ever been disappointed by their expected product quality. Based on the average value of respondent’s answers in quality variable, X2.2 indicator (product conformity) is the highest one while X2.1 indicator (product durability) is the lowest one. Thus, it can be assumed that respondents or tea customers mostly prefer a product with safe and practical packaging to be consumed. It means that customers prefer good or no defected product with short time durability. Product quality variable is one of the variables in this research supported by Sigh and Dr. Anita (2012) research as the previous research which showed that price, gift, scheme, brand, product quality standard, packaging, consumption intensity, attractive facility, and customers’ awareness are the important factors which influence customers’ behaviour toward that tea brand purchase. It is the basic reason why product quality variable is used as a brand-building factor in this research. Product quality variable becomes a point that considered by the customers in buying a product and will be embedded in that product how far the product quality which given to the customers is. Thus, it becomes the customers’ reference when they want to buy similar product next time. Hence, the product offered to the customers should has a good quality product than the similar products which produced by other competitors. If a company can maintain the quality consistency of the product, there will be a brand trust in customers’ mind while they buy that product. Some indicators such as product durability, product conformity, design variation, and the comfort of use mainly build product quality. In accordance to the result of this research which shows that product quality variable is significantly influenced as branding building of tea product. Hence, product quality variable should be improved and guarded (the value) to attain the regulation standard and can give positive value to product functions and customers’ needs. Price Variable of Brand Building It is found that the lowest factor loading value from price factor (X3) is in indicator (X3.3) which discusses about price conformity with product quality has the lowest value, means that the respondents’ answers at that question are the most homogeneous rather than other questions of price variable. It means that the respondents (here are the customers) feel that product quality they get is worthy with the price they pay. According to the average value in each indicator in price variable, the result shows that X3.2 indicator (price conformity with quality) is the highest indicator, while X3.4 (prize competitiveness) has a low value. It means that respondents or customers have felt that the price they pay is worthy with the quality they get but lack of price competitiveness as compared with similar products. Therefore, a tea product is expected to have more value to be given to costumers as a product with improvement value besides its benefit as a bursting thirst product.

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Price is a number of money which must be paid by customers to get a certain product. The conclusion of this research is that price factor is significantly influenced as branding building of tea product according to the test and data calculation. As the result of the previous research, that “price, gift, scheme, brand, product quality standard, packaging, consumption intensity, attractive facilities, and customers awareness are the important factors which influences customers behaviour toward tea brand purchase” (Sigh and Dr. Anita, 2012). Furthermore, Kotler and Amstrong (in Amrullah, 2006) stated that some price indicators such as price affordability, price conformity with product quality, price competitiveness with production benefits also support it. According to the demography data, majority of respondents income 2.500.000 IDR-4.999.999 IDR and dominated by women respondents, it is found that the high significance price on price variable with an interesting price offer or affordable is the same as branding building of that product. The brand product launching to customers is the first step for a manufacturer in selling its products. It can concluded that price variable is a variable that should be considered and included in variable which has the highest significance value in building a tea brand , because there are many good quality products in market so it should be supported by interesting price then boosting the tea customers attraction to buy. CONCLUSION Based on the results of this research and after going through data calculation and discussion, it can be concluded that: 1) Packaging Variable (X1) builds tea product branding in Surabaya 2) Product Quality Variable (X2) builds tea product branding in Surabaya 3) Price Variable (X3) builds tea product branding in Surabaya Packaging variable, product quality variable, and price variable build branding of tea product in Surabaya, thus this research states that the factors of tea products branding building in Surabaya can be accepted and the research questions of this research are answered. REFERENCES Akrom, Muchammad Chusnul. (2013). Pengaruh Kemasan, Harga, dan Promosi Terh (thesis)adap Proses Keputusan Pembelian Konsumen Kripik Paru UMKM Sukorejo Kendal. Semarang Amrullah, Artika Romal. (2016). Pengaruh Kualitas Produk, Harga, dan Citra Merek Terhadap Keputusan Pembelian Honda Beat. Surabaya Arikunto, S (2010). Prosedur Penelitian: Suatu Pendekatan Praktik Edisi Revisi. Jakarta: Rineka Cipta. Chernatony, Leslie de (2010). From Brad Vision To Brand Evaluation. The Strategic Process Of Growing And Strengthening Brands. Third Edition. Britain: Elsevier. Dharma, N.P.S. Adi & I Putu Gde S. (2015). Pengaruh Citra Merek, Kesadaran Merek, dan Kualitas Produk Terhadap Keputusan Membeli Produk Apple. Bali Ghozali, Prof.Dr.H. Imam (2011). Structural Equation Modeling Metode Alternatif dengan Partial Least Square PLS Edisi 3. Semarang: Undip Ghozali, Prof.Dr.H. Imam (2015). Partial Least Squares Konsep, Teknik dan Aplikasi Menggunakan Program SmartPLS 3.0. Semarang: Undip Hair, J.F., et al. (2010). Multivariate data analysis. (7th edition). New Jersey : Pearson Education Inc. Juanda, Michelle (2015). Faktor-Faktor yang Membentuk Keputusan Pembelian pada Konsumen Haresret Art. Surabaya

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Keller, Kevin Lane (2008). Strategic Brand Management. Building, Measuring, and Managing Brand Equity. Third Edition. USA: Pearson Prentice Hall. Kotler, P.D. (2010). Managemen Pemasaran Edisi 13 Jilid 2 Terjemahan oleh Bob Sabran. Jakarta: Erlangga. Kotler, P. & Amstrong, G (2010). Principles of Marketing, 13th Edition. New Jersey: Pearson Prentice Hall. Kotler, P., & Ketler, K. L. (2012). Marketing Management Edisi 14. New Jersey: Pearson Prentice Hall. Han, Yuqi. (2014) ‘Brand Development In Chinese Tea Market. Case Company: Lipton’, McNally, David., & Karl D. Speak. (2004). Be Your Own Brand. Resep Jitu Meraih Personal Brand Yang Unggul. Jakarta: Gramedia Pustaka Utama. Nora, Narulita H. (2011). Analisis Pengaruh Kesadaran Merek, Persepsi Kualitas dan Loyalitas Merek Terhadap Ekuitas Merek (Studi Kasus Pada Pengguna Shampoo dan Konditioner SUNSILK Kota Semarang). Semarang Octaviona, Nanda. (2016) ‘Pengaruh Citra Merek Dan Persepsi Harga Terhadap Keputusan Pembelian Gadget Di Toko Suryaphone Samarinda’, eJurnal Psikologi, 4 (4) 397-407 Purwati, Setiawan, H., & Rohmawati. (2012). Pengaruh Harga dan Kualitas Produk Terhadap Keputusan Pembelian Motor Honda Matic Beat (Studi Kasus pada PT. Nusantara Solar Sakti). Jurnal Ekonomi dan Informasi Akuntansi (Jenius), Vol. 2, No. 3, 260-277. Qasim, M Shehbaz. (2013) ‘Analysis of The Influencing Factors for Brand Preferences Towards FMCG in Delhi NCR’, International Journal of Science and Research (IJSR) Shojaei, V.K, Sayed H. K. H, Parviz A. (2012) ‘Conceptualization of Integrated Brand Engagement (IBE) Grounded Theory Strategy: A Case Study of Iran Automobile Industry’, Intl J. Humanities Vol.18 (2): 133-150 Singh, Mahavir, & DR. Anita. (2012) ‘Consumers Buying Behaviour Towards Branded Tea’s’, International Journal of Computing and Corporate Research Vol 2 Yunitasari, Cindy & Edwin Japrianto. (2013). Analisa Faktor-Faktor Pembentuk Personal Branding dari C.Y.N. Surabaya

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ANALYSIS THE INFLUENCE OF TRUST ON SUCCESSION PLANNING (STUDY AT SONOKEMBANG GROUP) 1

Amanda Syafrida Paramita, 2Christina Whidya Utami♠ Ciputra University INDONESIA Email: [email protected] ABSTRACT

Phenomenon that is often encountered in family business is the fewer number of family business that can sustain until the third or fourth generation. In order to survive and develop, succession planning is necessity. The trust from predecessor generation is one of the supporting factors in succession planning. The purpose of this study is knowing and analyze the main dimensions of trust which are competence, integrity, and benevolence against succession planning. Research subjects were consumers, employees and family of Sonokembang. This quantitative research is using questionnaire with Likert scale. Sampling method by proportionate random sampling and processing data using Structural Equation Modeling Partial Least Square (SEM-PLS). This study found that competence, integrity and benevolence have significant effect on trust, trust has significant effect on succession planning, and competence, integrity and benevolence have significant effect to succession planning. Keywords: Family enterprise, succession planning, trust, competence, integrity, benevolence INTRODUCTION From a family business survey conducted by PWC in 2014 found that more than 95% of businesses in Indonesia are family owned and in Southeast Asia 60% of public companies are family businesses. However, many family businesses are difficult to pass through three generations. Referring to research conducted by the Family Firm Institute for The Family Business Review (Hall, 2008), it is known that only 30% of all family-owned enterprise survived at the transition period between generations in the second generation, while only 12% survive in third generations and only 3% are capable of developing until the fourth generation. The planning and implementation of succession is one thing to maintain the existence of a family company and continue to develop in a better direction (Noraini & Ahmad Najmi, 2009). Succession is a crucial issue in maintaining the sustainability of the family business. A survey conducted by The Jakarta Consulting Group states only 67.8% companies that have prepared the next generation with succession planning (Susanto, 2007). This survey shows that there are still many companies that have not or have not done succession planning. Succession planning is a very complicated and often makes the founder or predecessor generation does not want to do so. This reluctance may be due to concerns about the death of the company, to give up control of the company, the fear of loss of self-identity, or even jealousy or rivalry toward its successors. Another reason not to be prepared for succession is that the founder feels that the younger generation is not interested in participating in the

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company, or it is difficult to determine which child is competent enough to continue the business. What often happens is that despite officially declaring retirement from the company, in fact the senior generation is interfiring in the business activities. Meanwhile, the child feels burden of advancing the company as his parents or the burden of uniting family members in the event of internal conflict. In addition of burden, the feeling of less appreciate from senior is also one of the obstacles in succession planning. Sonokembang Group is a family enterprise legalized since 1987. Its business unit is 4 (four) catering business units located in Surabaya, Malang, Semarang and Jakarta and 1 (one) wedding decoration business unit in Surabaya. Currently its ownership and leadership have reached the second generation and some of the third generation family members have started joining at entry level and managerial in the catering business unit. The current situation in the Sonokembang company is that some of the family members have occupied managerial positions but have not been given full trust and authority in making business decision, have communication problems, lack of appreciation for achievements made by third generation, and other third generation family members have not clearly understand the vision of this company so they show lack of interest in joining the company. This study was conducted with consideration of the current state of the company and the Sonokembang family, especially the second-generation trust factor of the third generation and vice versa. The purpose of this research is to know and analyze the influence of competence, integrity and benevolence to trust and influence of trust, competence, integrity and benevolence to succession planning. LITERATURE REVIEW Previous Research Previous research used as a reference in this study is a study conducted by Krot and Lewicka (2012) entitled "The Importance of Trust in Manager-Employee Relationship." The purpose of the research is to see the role of the dimension of trust in multi-level organization in a company. From the results of the research, the result shows that competence is the least important in all types of relationships, integrity is an important thing in trust between fellow workers, and benevolence is the most important thing in the relationship between managers and employees. Second is the research conducted by Gupta and Choudhary (2016) entitled "An Emprirical Study Assess the Impact of Various Relationship Dimensions on Supplier Relationship in Indian Scenario". This study aims to determine the dimensions of the relationship between trust, satisfaction, cooperation, communication and commitment to supplier relationship in India. The results of the study stated that there is a relationship between competence and trust. The relationships owned by both variables are positive so when competence increases it will affect the trust given positively. The third study was a study conducted by Heinre and Mahmbe (2015) entitled "The Influence of Integrity and Ethical Leadership on Trust in The Leader". This study aims to investigate the relationship between integrity, leadership and trust in the leadership model. The results of this study indicate a positive relationship between ethical leadership and trust, integrity and leadership and also integrity and trust. Family Business According to John L. Ward and Craig E. Arnoff (2002, in Susanto, 2007), a family business is a company consists of two or more family members who supervised the company's finances. Robert G Donnelley (2002, in Susanto 2007) state that an organization is called a family business if there are at least two generations involved in the family and they influence company policy. Sonokembang Group belongs to a family company because it is now a second-generation ownership and second generation management as a board of directors and some of a third generation who occupy managerial positions.

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Family Business Life Cycle Ichak Adizes (1989) introduces 10 life cycles of a company: courtship, infant, go-go, adolescence, prime, stable, aristocracy, early bureaucracy, bureaucracy, death. Like humans who have a life cycle from infancy to adulthood then become an elderly, the company also has a life cycle. Unlike human that age is determining the life cycle, the company's age is not a determining factor of a company’s life cycle. Sonokembang Group is currently at the Prime-Stable state where its organization is growing and making improvements to its working system by Standard Operating Procedure (SOP), organizational structure, international certification for food safety. This condition needs more attention, especially from the second generation, because making a succession planning is a must in order to maintain the existence of the company, considering only 35% of third generation who has already joining the company. Succession In order to maintain the sustainability of family business, there is a need for succession process. Within a family company, family members expect the successful from the next generations. Susanto (2007) states that leadership succession is a natural event and reached various managerial layers. Succession is related to various corporate policies, including changes in the pattern of corporate movements, corporate development, and career planning policies, promotion systems and mutations. Succession, therefore, is not limited only the transfer of the top leadership, and also not only based on age nor from owners to next generation and professionals. Succession should be planned and implemented for a broader purpose. Based on the Company's life cycle (Adizes, 1989) a founder should perform succession planning at the Go-Go stage because the company will die along with the death of its founder. The founder could not work alone, he must prepare delegation of authority to his next generation, administrative system and procedures so that the company is not always tied to its founder. While in the second generation and onwards the succession planning should begin in the Prime and Aristocracy phases where in this phase organizational development takes place which requires the involvement of outsiders to take control in the managerial ranks and directors to maintain the company's sustainability. Succession Planning Succession planning aims to maintain and develop the standard excellence of the company's performance as well as the competencies it possesses and responds to the preparation needs of "Future Executives" who has to be ready for future challenges (Peter Ashey in Susanto, 2007). Succession planning is made for the effectiveness in the family business. Effective succession plans mean planning it as early as possible by involving family members. There should be an option for the next generation whether joining or not in the company (Susanto, 2007). Trust Trust is an important core of the family business (Eddleston, Chrisman, Steier and Chua, 2010) and is the privilege in family business (Davis & Harverston, 1998). Rousseau et al. (1998) defines trust as a psychological condition to accept others based on positive expectations of the person's intentions and behavior (in Atsan & Erden, 2015). Trust is the foundation of a relationship. A relationship between two or more parties will occur if they trust one another. This trust can not be simply recognized by others but must be built and proven from the beginning.

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Dimension of Trust Interpersonal trust has a cognitive and affective basis (Atsan & Erdem, 2015; Mc Allister, 1995). Cognitive based beliefs are built on perceptions and interests as they relate to performance and achievement through direct contact with others. Cognitive trust occurs when a person makes a decision to believe based on knowledge (McAllister, 1995). While affective trust is based on an emotional bond that often tends to go beyond business or professional relationships or prior knowledge. These emotional bonds make the basis of trust. Cognitive trust builds on the beliefs of competence, integrity, responsibility, credibility, reliability, and dependability. The affective trust consists of benevolence, interest, loyalty, altruism, commitment and mutual respect (Atsan & Erdem, 2015; Ribiere & Sitar, 2010). Trust in a family company succession The dominant factor in successful succession in family firms is family relationships. In a previous study conducted by Morris, Williams and Nel (1996) about factors affecting family company succession, it was stated that trust between family members and firms was the determinant of a successful transition. Competence, Integrity and Benevolence in Succession Planning Poza (2010) states that competence without integrity or commitment will not make the predecessor feel confident in terms of leadership transfer with the future generations. Although the next generation fulfills all the specified qualifications but does not gain trust in making decisions for both businesses and family interests then the child is still declared has not ready to lead the company. The Influence of Competence on Trust Competence is the ability of a person in fulfilling all tasks appropriately to his work. Supported by research conducted by Krot and Lewicka (2012) there is a relationship between competence and trust. It happens to a new organization or company where competence has a high role to build trust in relationships within the organization. Trust can be built through someone competency because it does not contain emotional elements and expected to have higher performance in accordance with the mandated. H1: Competence affects trust. The Influence of Integrity on Trust Integrity is one of the belief-forming dimensions of honesty aspect, strong character and courage (Poza, 2010). It shows that leaders need to have integrity to gain trust in the organization or company he leads. The relationship is supported by Krot and Lewicka (2012) research results that explain that integrity can influence the trust that occurs in relationships within the company. It happens to a company that has grown, so that integrity plays a larger role compared to competence and benevolence. H2: Integrity affects trust. The Influence of Benevolence on Trust Benevolence is a willingness to pay attention to the trustor's interests in the decision-making process (Krot & Lewicka, 2012). It shows that with the nature of the benevolence has the belief that all good deeds done by people who are given trust, there is no effort to get benefit from people who gave trust. This is supported by the results of a research conducted by Krot and Lewicka (2012) which also explains that there is a relationship between benevolence and trust. The results also suggested that benevolence is the most important dimension in trust that occurs

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between employees and managers. Therefore, if a person's own benevolence increases, then the trust given will also increase. H3: Benevolence affects trust. The Influence of Trust on Succession Planning Trust is an important factor on family business (Eddleston, Chrisman, Steier and Chua, 2010). Trust is the foundation of a business relationship within a company. The first priority of a family leader is to build trust among family members. The existence of this relationship is supported by the research conducted by Morris, Williams and Nel (1996) on factors that influence the succession of family companies. The result of this study suggested that trust among family members and firm is a determinant factor of successful transition. Therefore, trust is related to the successful of succession planning in an organization or family enterprise. H4: Trust affects succession planning. The Influence of Competence on Succession Planning Competence is necessary in an organization or company. In family enterprises, competence is also considered in succession planning. This is related to the next generation of companies that need to qualify before continuing the company management (Poza, 2010). Based on results of the research, Hatak and Roessi (2015) note that competence has a strong relationship with the transfer of knowledge in the succession of family companies. If the competence increases will affect the transfer of knowledge in family succession also increase. The succession will be well planned. H5: Competence affects succession planning. The Influence of Integrity and Succession Planning Integrity is also one of the dimensions associated with succession planning in the family company (Poza, 2010). Integrity means doing what should been done and emphasizes on honesty, strong character and courage. Poza (2010) states that competence without integrity or commitment will not make the predecessor feel confident in terms of leadership transfer with the next generations. Although the next generation fulfills all the specified qualifications but does not gain trust in making decisions for both business and family interests then the child is still declared not ready to lead the company. H6: Integrity affects succession planning. The Influence of Benevolence on Succession Planning Benevolence is a willingness to pay attention to the trustor's interests in the decision-making process (Krot & Lewicka, 2012). Given the nature of benevolence such as paying attention to every employee and family member and doing good to the employees or future generations such as the welfare of family members, the transfer of values as a family culture will be effective for the next generation preparation that includes knowledge, legitimacy and credibility so that succession planning becomes effective and family business can run well. H7: Benevolence affects on succession planning RESEARCH METHOD This type of research is quantitative study. This approach is used because the data in this study is using statistical methods to determine the relationship between independent variables which are competence, integrity and benevolence and dependent variables which are trust and succession planning. The data collection used in this research is survey method using instrument in the form of questionnaire with Likert scale (1 = strongly disagree, 2 = disagree, 3 = enough, 4 = agree, 5 = strongly agree) which then analyzed by using SEM -PLS (Partial Least Square Structural Equation Modeling).

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The population in the study is 223 people consisting of 35 members of the Sonokembang family who came from the second and third generation, 60 employees and 128 consumers of Sonokembang Catering Semarang. Meanwhile, the sampling technique is using proportionate stratified random sampling technique. Used the Slovin formula and error rate of 5%, the sample size is 143 people with the proportion of 22 person family members, 39 employees and 82 consumers of Sonokembang Catering Semarang. Figure 1 below is a research model as a summary of the seven hypotheses

Figure 1. Research Model Source: Developed by the authors RESULTS AND DISCUSSION Results of data processing using PLS - SEM method with Smart PLS 2.0 M3 which includes evaluation of measurement and structural model.

Figure 2. The Partial Least Square Measurement and Structural Model Source: Developed by the authors from the survey data

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The following is an explanatory evaluation of the measurement of outer model that includes validity and reliability test: a. Validity test The convergent validity includes loading factor, Average Variance Extracted (AVE) and communality. From the calculation results of loading factor all indicators are ≥0.7 except on the PS1 indicator (variable Successional Planning) which has a value of 0.6. According to Prof. Dr. Imam Ghozali, M.Com an indicator has a significant loading factor at minimum 0.7, exceptional for research with non establish variable, loading factor at 0.5-0.6 is allowed.

Benevolence Integritas Kepercayaan Kompetensi Perencanaan

AVE 0.601230 0.738035 0.646967 0.643407 0.577380

Table1. Validity Test Communality 0.601230 0.738035 0.646967 0.643407 0.577380

Suksesi Source: Developed by the authors from the survey data From the table above shows the Average Variance Extracted (AVE) and communality of all variables is ≥ 0.5. The three values above show that the data used is valid. b. Reliability Here are the values observed in the reliability test which include cronbach's alpha and composite reliability: Table2. Realibility Test Composite Reliability Cronbach’s Alpha Benevolence 0.818688 0.667011 Integritas 0.894137 0.822117 Kepercayaan 0.879924 0.818289 Kompetensi 0.843686 0.721790 Perencanaan Suksesi 0.890548 0.851703 Source: Developed by the authors from the survey data From the table above shows the value of Cronbach's alpha ≥0.6 and composite reliability ≥0.7. This indicates that the data used is reliable. Evaluation of Structural Model (Inner Model) a. R – square The first inner model evaluation is the R-square value for each endogenous latent variable as the predictor force of the structural model. Changes in R-square values can be used to describe certain exogenous latent to endogenous latent variables (Ghazali, 2012). R-square value 0.75, 0.50, and 0.25 can be concluded that the model is strong, moderate and weak. Table3. R-square Variable R-square Keterangan (0.75=Kuat; 0.50=Moderat; 0.25=Lemah) Trust (KP) 0,4158 Moderat Succession Planning (PS) 0,6432 Moderat Source: Developed by the authors from the survey data

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The R-square value for the trust variable is 0.4158 or moderate, meaning the percentage of the diversity of trust variables can be explained by 42% competence, integrity and benevolence variables while the rest is explained by other variables outside the model. The Rsquare value for succession planning variables is 0.6432 or moderate, which means that the diversity of succession planning variables can be explained by competence, integrity, benevolence and trust variables of 64% while the rest explained by other variables outside the model. b. Q - square Predictive Relevance Q-square Predictive Relevance used to validate model prediction capabilities. The interpretation of the result Q-square Predictive Relevance is that when the value is greater than 0 indicates the independent variable is good or appropriate as the explanatory variable capable of predicting the dependent variable (Yamin, S., & Kurniawan, 2011). Table4. Q-square Predictive Relevance TOTAL SSO SSE 1-SSE/SSO Benevolence 429,0000 338,6159 0,2107 Integritas 429,0000 233,7160 0,4552 Kepercayaan 572,0000 338,4898 0,4082 Kompetensi 429,0000 304,1642 0,2910 Perencanaan Suksesi 858,0000 508,8353 0,4070 Source: Developed by the authors from the survey data From the data above shows that all values of Q2 above 0. This indicates good predictability relevance for each variable. From the data also shows that integrity has the highest value, meaning it has better prediction relevance than competence and benevolence. Goodness of Fit (GoF) To validate the model entiretye can be seen from the Absolute Goodness of Fit (GoF) using this following formula:

The value of the upper-bound communality is the average value of communality while the upper bound R2 value is derived from the average value of R2. Based on the calculation, the average communality is 0.6414038 and the average R2 is 0.52951. The following equation for Goodness of Fit: GoF = √0.6414038 x 0.52951 GoF = 0.5827776 Based on the above calculation shows that the value of GoF> 0.36 which can be concluded that this model has a great predictability. Hypothesis testing The hypothesis is eligible or acceptable if the t-statistic value (t-count) has a value greater than the t-table value (1.96).

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Table5. Path Coefficients PATH

SUPPORT TO T- STATISTICS

COEFFICIENTS HYPOTHESIS B → KP 0.329787 4.252211 Yes B → PS 0.356382 3.872201 Yes I → KP 0.178160 2.507196 Yes I → PS 0.213873 3.767097 Yes KP → PS 0.237882 3.602011 Yes K → KP 0.315799 4.377248 Yes K → PS 0.235666 3.283348 Yes Source: Developed by the authors from the survey data From table 3 above can be concluded that the first hypothesis was proven. Competence has a significant effect on trust. The result of Krot & Lewicka (2012) study that examines the relationship of trust among workers and between workers and managers also shows that competence gives influence to trust. In addition, the results of the research also show that in new organization, competence has the most important role in building trust. The second hypothesis also gave positive effect. Integrity has significant effect on trust. Heine and Mahmbe (2015) study by using SEM Statistical Analysis has a positive relationship between integrity with the leader's trust. A leader who actively shows examples of integrity such as honesty, consistency and moral behavior will succeed in building trust between leaders and workers. Third hypothesis was proven. Benevolence has a significant effect on trust. This is supported by previous research conducted by Krot & Lewicka (2012) which states that benevolence affects trust among employees and trust between employees and managers because employees tend to trust their managers if they show interest and concern for their welfare. The fourth hypothesis gave positive effect. Trust has a significant effect on succession planning. Eddleston, Chrisman, Steier and Chua (2010) state that founders of family firms have experienced the creation of their businesses can influence how they will run their business, the makin of corporate culture, the strategy adopted and succession planning. These experiences will influence founder on trusting others both family members and non-family members. The fifth hypothesis was confirmed. Competence has a significant effect on succession planning. The results are supported by Poza (2010) in his book entitled "Family Business" stating competence is something that is considered in succession planning. The sixth hypothesis was confirmed. Integrity has significant effect on succession planning. The results are supported by Poza's (2010) assertion that competence without integrity or commitment will not gain the precursor generation’s trust in the transfer of leadership to the next generations. The sevent hypothesis was confirmed. Benevolence has a significant effect on succession planning. The results obtained by Krot & Lewicka (2012) also stated that the nature of benevolence in the family company can be a good deeds to employees and family members. It is necessary to prepare the next generation for effective and better succession planning. CONCLUSSION Competence, integrity and benevolence have an impact on the trust of Sonokembang employees and customers. In addition, the competence, integrity, benevolence of the third generation influences the second generation’s trust and in the process of succession planning. The research hypothesis states that the variables related to trust and succession planning in Sonokembang and the research problem in this study can be answered.

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REFERENCES Abdillah, W., Jogiyanto, HM., 2015. Partial Least Square (PLS) Alternatif Structural Equation Modelling (SEM) dalam Penelitian Bisnis, Penerbit ANDI, Yogyakarta Aronoff, 2003, Business Succession: The Final Test of Greatness, Family Enterprise Publisher Gupta, M, 2016, An Empirical Study To Assess The Impact Of Various Relationship Dimensions On Supplier Relationship In Indian Scenario. Int. J. Indian Culture and Business Management, Vol.12, No.2, 2016 Hatak, I.R., Roessl, D., 2015, Relationship Competence-Based Knowledge Transfer Within Intrafamily Succession, Family Business Review Vol. 28(1) 10-25 Heine, G., Mahembe, B., 2015, The Influence of Integrity and Ethical Leaderhip On Trust in The Leader, Management Dynamics Volume 24 No.1, 2015 Krot, K., Lewicka, D., 2012, The Importance of Trust in Manager-Employee Relationships, International Journal of Electronic Business Management, Vol. 10, No. 3, pp 224-233 Latan, H., Ghozali, I., 2012, Partial Least Squares Konsep, Teknik dan Aplikasi Smart PLS 2.0 M3, Badan Penerbit Universitas Diponegoro, Semarang Poza, Ernesto J., 2010, Family Business 3E, South-Western Cengage Learning, USA Sugiyono, 2015, Metode Penelitian Pendidikan Pendekatan Kuantitatif, Kualitatif, dan R&D, Penerbit Alfabeta, Bandung Susanto, AB., Susanto, P., Wijanarko H., Mertosono, S., 2007, The Jakarta Consulting Group on Family Business, Divisi Penerbitan The JCG, Jakarta

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THE EFFECTS OF TRAINING, RECRUITMENT AND LEADERSHIP ON COMMITMENT TO SERVICE QUALITY EMPLOYEES (STUDY CASE: SONOKEMBANG CATERING) Anindita Laksmi, 2J.E. Sutanto♠

1

Ciputra University Surabaya INDONESIA Email: [email protected], [email protected] ABSTRACT A service quality becomes one of the formation of loyalty to the consumer. Employees are not only required to do the job as good as possible but employees also act as brand ambassadors of the company. Employees at service companies have a responsibility to fulfill the promises offered by the company, therefore it is important for employees to be committed to the quality of service. This study used a quantitative approach using primary data from questionnaires and secondary data from literature studies. The research use multiple regression method with three independent variables those are, Training, Recruitment and Leadership while the dependent variable used is Commitment of service quality. Based on data analysis that has been done Training (X1) and Recruitment (X2) do not has significantly influence partially to commitment of service quality. While Leadership (X3) has a significant partial influence on service quality commitment. Keywords: Commitment to Service Quality, Training, Recruitment

INTRODUCTION A quality service becomes one of the formation of loyalty to the consumer. This quality service is the responsibility of an employee. Employees are not only required to do the job as well as possible but employees also act as brand ambassadors of the company. Starting from the behavior, how to dress, how to communicate will affect consumer perceptions on a brand company, mainly at employees who deal directly with customers. The Highest competition in the company's catering business many companies are focusing on marketing and building a strong brand. But can’t be denied the success of a company brand, especially the companies that offering services can’t be separated from the behavior of employees in providing services. Therefore, companies need to pay attention on employee behaviors when they delivering services to keep pace with the company's service standards, especially on employees who deal directly with consumers. Employees are required to be able to provide quality of service and consistently to achieve and maintain the reputation and image of the company. Therefore the establishment of commitment to quality of service on employees is a strategy that needs to be applied.

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Based on the satisfaction survey supervisor analyzed using IPA (Important Performance Analysis) that has been done in Sonokembang Catering at 30 events that use Sonokembang Catering was found that the factors that are important for the customer are Care, Product Knowlaedge, but suitability of an employee's performance is still not implemented Well, so it has not fulfilled customer expectations. To maintain the consistency of customer satisfaction and the image of Sonokembang Catering can not just based on sales, but also on service to consumers. One way to maintain the consistency of customer satisfaction and the company's image is increase the commitment of employees in work especially for always providing a service quality, so the employees can understand and able to apply and deliver company's brand promise to customers. Based on the existing problems can be seen that the brand company can not only depend on promotion, sales but also need to focus on employees who are dealing directly with consumers. But diverse the human nature makes the company worried, because during the service process consumers will get various treatments of various behaviors. LITERATUR REVIEW Previous research Training has a positive impact on employees' commitment to the organization. With the increasing of employee commitment to the organization, the quality of services provided by employees increased, too. Training also helps employees to improve performance, and solve problems when they are dealing with consumers. Outsourcing recruitment with external parties based on employee commitment and loyalty in the communications sector in Pakistan. The result showed that the outsourcing recruitment that do not influence the formation of employee commitment and loyalty to the company. Transformational leadership and organizational commitment to job satisfaction and employee performance performed at shipping company in Jakarta, it was found that the transformational leadership model gives a significant positive effect on commitment of service quality of employee to organization besides that transformational leadership also give postive influence significantly to employee performance. Training Training is an important thing in a company, because training is able to educate employees to know and understand the company's brand and promises, therefore training programs need to be done consistently so the training can be an effective activity in aligning personal values with values company ((Diep. L and Stedt. A., 2015). Leadership A leader is someone who can influence employees to change bad habits into good habits and in accordance with the company's values. Communication that made by a leader can used as a reference for the formation of an employee commitment. The leader has an obligation to run the company's promises and translate them into an action. The leaders must strive to apply company values so as to motivate employees to do the same (Diep. L and Stedt. A., 2015). Recruitment Outsourcing recruitment process is a strategy that is often used in various companies. This strategy is used because it can assist companies in saving costs, time and can improve the quality of recruitment. But this strategy also has the disadvantage that the chances of failure in the formation of commitment and loyalty is very high, this is because the provider of outsourcing providers do not understand the structure, culture, values and system companies (Jamil and Naeem, 2013).

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Komitmen Pada Kualitas Pelayanan Commitment to the quality of service is the participation of employees in providing service oriented to the quality standards of the company so that consumers feel satisfied and benefited (Gull and Ashraf, 2012). RESEARCH METHODS In this study, using a quantitative approach. A quantitative approach is an approach that uses a specific population or sample to conduct research. The research instrument used was a questionnaire that uses the training, recruitment and leadership as an independent variable to the employee's commitment to service quality as the dependent variable and the measurements were performed using a Likert scale. Based on the formulation of the problem, the purpose of research and literature review, then the hypothesis to be tested in this study is H1: Training has a positive impact on the establishment of service quality commitment to service employees at Sonokembang Catering. H2: Employee recruitment has a positive impact on the establishment of service quality commitment to service personnel at Sonokembang Catering. H3: Leadership has a positive impact on the establishment of a quality service commitment to service personnel at Sonokembang Catering. Sampling method that used in this research is Saturated Sampling. This sample method is used because the population is relatively small as many as 30 people. Based on the sampling method conducted will be determined by several criteria, namely: a Permanent employee of Sonokembang Catering b Meet directly with consumers c Meet directly with the stakeholders d Providing services to consumers The samples taken in the service-banquet and marketing department. After completing the questionnaire, the data were analyzed using multiple linear regression method with SPSS software. The equation used is Y = α + β1X1 + β2X2 + β3X3 + ε Explanation: Y = Service Quality Commitment α = Constants β1 β2 β3 = Multiple regression coefficient X1 = training variable X2 = recruitment variable X3 = leadership variable ε = error RESULTS AND DISCUSSION The number of respondents in this study were 30 people, 70% were male and 30% were women. Independent variable in this research is training (X1), recruitment (X2), leadership (X3), while the dependent variable in this research is commitment of service quality (Y). From the result from this analysis it have been obtained, there are significant influence simultaneously between training variables (X1), recruitment (X2) and leadership (X3) with quality service commitment variable (Y). Training (X1), recruitment (X2), and leadership (X3) gives 43.1% influence on quality service commitment variable (Y), while the rest is influenced by other variables. It also found that training variables (X1), recruitment (X2), and leadership (X3) significantly influence partially on service quality commitment, leadership variable (X3) is more dominant than training variable (X1) and recruitment (X2). Ŷ = 5,803 + 0,265X1 + 0,012X2 + 0,522X3

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If the leadership variable (X3) has increased by one unit then the commitment of service quality (Y) will increase by 0.522 units. If the training variable (X1) has increased by one unit then the service quality commitment (Y) will increase by 0.265 units. Meanwhile, if the recruitment variable (X2) has increased by one unit then the commitment of service quality (Y) will increase by 0.012 units. The Effect of Training on Commitment to Quality of Service Based on the analysis, the training had no significant effect partially on service quality commitments. It can be seen on the result showing the significant value equal to 0,256 (greater than 0,05). This is because the training is still not implemented consistently and regularly, so that the effect on improvement of service quality commitment to employees is still very minimal. Besides variety of training impact on improving service quality is still lacking, so that employees are getting the learning about the quality of service, especially in accordance with company standards. The Influence of Recruitment on Commitment to Quality of Service Based on the results, thw recruitment has no significant partial effect on the commitment of service quality. It can be seen on t test result that shows significant value equal to 0,141 (greater than 0,05). This is because the recruitment activities are still not meet all the criteria that have been set by the company, especially on recruitment for out sourcing. In addition there is still no evaluation on the vendor side out source providers, so that the quality provided does not increase but stagnant on the quality that is less in accordance with the company's standards. Recruitment is a beginning of a commitment is formed, so that recruitment activities need to be done in accordance with the standards set by the company. By doing the proper recruitment and accompanied by the criteria in accordance with the required competency can help employees to be more focused in their work and easy to work in teams, so employees can find out the goals to be achieved and how to achieve it. In addition, by looking at the capabilities owned by employees it will give influence in making decisions to make additional employees or not (Rahardjo, 2015). The Influence of Leadership on Commitment to Quality of Service Based on the results, leadership has a significant influence partially on the commitment of service quality. It can be seen on the test result, significant value equal to 0,009 (less than 0,05). This is because the leader in Sonokembang Catering still come down to the field and participate in supervising, when employees provide services. Thus helping to variable or fixed employees are outsourced to be able to continue to provide quality service. Leaders have an important role in implementing branding in their daily work. When the leader has implemented brand and values,it becomes genuine. It can affect the attitude of employees to the brand and deliver the promise of a brand. When leaders lead with a clear and brandappropriate value it helps to employees identify brands, because the leader can be used as examples to implement internal brands of everyday activities. ((Diep. L and Stedt. A., 2015) Based on the results of the whole analysis can be seen that leadership has the most influence in the establishment of service quality commitment to service personnel. This is because the leaders at Sonokembang Catering have understood the values of the company, and always try to convey the values of the company with an easy language so the employees can be more understood, so that employees are able to apply in everyday activities. CONCLUSION Based on the analysis, it was found that Training (X1) and Recruitment (X2) did not influence significantly, while Leadership (X3) had significant effect. Therefore it is necessary to make improvements on these two variables so that the future can provide maximum results in the company.

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REFERENCES Diep, L., Steadt, A. 2015. Internal Branding: Within a Swedish Non Profit Organization. Kristianstad. Jamil, R., Naeem, H. 2013. The Impact of Outsourcing External Recrutiment Process on The Employee Commitment and Loyalty: Empirical Evidance From The Telecommunication Sector of Pakistan. Journal of Business and Management Vol 8 PP 69-75 Gull, S., Ashraf, S. M. 2012. Impact of Internal Branding On Service Employee’s Quality Commitment-Study On Education Sector of Pakistan. Internasional Journal of Business and Social Science Vol. 3 No. 14 PP 302 – 311. Rahardjo, W. 2015. Membangun Internal Branding. http://www.readersdigest.co.id/investasidan-bisnis/membangun+internal+branding (Diakses 15 Desember 2016)

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ANALYZE THE EFFECTS OF SERVICE QUALITY, PRICE, AND PRODUCT QUALITY TREND TRACER ON CONSUMER PURCHASE SATISFACTION Grace Latumahina, 2Christina Whidya Utami♠

1

Ciputra University Surabaya INDONESIA Email : [email protected]

ABSTRACT This study examines the satisfaction of consumer purchases the product in an attempt onlineshop Trend Tracer clothes in Indonesia. The purpose of this study was to determine and analyze the influence of service quality, price, and quality of products to the satisfaction of consumers on product purchase Trend Tracer partially. In this study, using a multiple linear regression statistical techniques. The method used in this research is quantitative method by means of a survey. Data collection techniques used is by distributing questionnaires. The survey results revealed that significant influence service quality to satisfaction of consumer purchases, their significant influence prices on the satisfaction of consumer purchase, and significant influence product quality to customer satisfaction on product purchase Trend Tracer. Keywords: Service Quality, Price, Product Quality, Satisfaction

INTRODUCTION One of many reason economies grow in Indonesia are Fashion Industry. Fashion are the best bet for trending business, especially in clothes, shoes, and accessories. Right now Fashion business are changing every month and keep up with people life style. It doesn’t effect in people stratum of life Fashion including man, woman, child, and baby. The number one ascend industry in creativity sector is Fashion industry. Contribute 641,8T Rupiah to our PDB, above Transportation, Financial, Real Estate, and Services sector. Fashion industry Indonesia promise every aspect and growing rapidly. New brand of local appear everywhere with pretentious and creativity. Focusing on new innovation to attract more people within certain age categories. People in Indonesia appreciate for local brand cause of the similarities to foreign product. The new comers of local brand called Trend Tracer and started on April 17, 2015. Trend Tracer had their own unique trend, one of it they called “Self Printed”. It categories in many variety, from 15 years old up to 50 years old. Qualification for good Fashion industry business are “Price, Service, quality of the product, and Analysis market”. One of the sectors driving economic growth is the Fashion industry. Fashion is a common term for popular styles, especially in clothing, shoes and accessories. Fashion penetrates on everything that follows the current trend and how to dress someone. Fashion is always there in all walks of life, all ranges of age and sex, ranging from children, teens, adults, both men and

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women. The Indonesian Fashion Industry has now become one of the prima donna subsectors of the creative industries and even the creative economy sector contributes 641.8 trillion rupiah to our GDP, slightly above the transport and communications sector, as well as the financial, real estate and corporate services sectors (Kemenperin, 2015). The fashion industry in Indonesia is quite advanced and promising. The emergence of local ambitious fashion designers, bold and have a pattern of creativity that prioritizes innovation and has high power and high selling power, is in great demand today. So, local fashion brand lately growing rapidly and increasingly have a name in the eyes of consumers. In the country itself began to appreciate and appreciate local brands because of the best quality and design that is not less interesting also innovative. Trend Tracer is a fashion brand that stood since April 17, 2015. Brand fashion is intended especially for women aged from 15 years to 50 years. The products offered by Trend Tracer brand is a shirt with a design pattern and design your own model. The uniqueness of this product is Self-Printed. Unlike other fashion brands, this brand wants to provide something different and not easily be equated by other fashion brands or designers. The problems that exist in this business is how to know the consumers who have bought Trend Tracer clothes are satisfied with the goods that have been purchased in accordance with the qualification of the sale, therefore the authors conducted a study "Analysis of Service Quality Influence, Price, and Product Quality Trend Tracer Against Consumer Purchasing Satisfaction". LITERATURE RIVIEW Previous research The study was conducted by Johanes Gerardo Runtunuwu, (2014) under the title "The Influence of Product Quality, Price, And Quality Of Service To The Satisfaction Of Users Of Cafe And Resto Cabana Manado". The purpose of this study is to determine the effect of product quality, price, and quality of service to user satisfaction Cafe and Resto Cabana Manado. The type of research used is associative research and analysis techniques using multiple linear regression. The results showed that product quality, price, and service quality positively affect the user satisfaction of Cafe and Resto Cabana Manado. Product quality is influential but not significant to user satisfaction. Price and quality of service have a significant effect on user satisfaction. Service Quality According to Tjiptono and Chandra (2011:162) the quality of service or service quality contributes significantly to the creation of differentiation, positioning, and competitive strategy of every marketing organization, both manufacturing and service providers. Quality of service is something perceived by the customer. Customers will assess the quality of a perceived service based on what they describe in their minds. Factors affecting service quality based on SERVQUAL method according to Tjiptono and Chandra (2011:198) as follows: 1. Reliability 2. Responsiveness 3. Assurance 4. Empathy 5. Tangibles Price The term price according to Kotler (2012:290) is the amount of money paid for a product or service, whereby the amount of money or value incurred by the consumer is in lieu of the benefit of the ownership or use of a product or service. Another point expressed by Daryanto (2013: 62) that defines the price as the amount of money that is billed for a product or a number

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of values that consumers exchange for the benefits they have in using the product. Here are the indicators that characterize the price proposed by Stanton on Sagita (2013) : 1. Affordability of price 2. Price compliance to product quality 3. Price Competitive 4. Price compliance with benefits Product Quality Kotler and Armstrong (2012:283) defines product quality as the ability of a product to perform its functions, including durability, reliability, accuracy, ease of operation and improvement, and other valuable attributes. Another opinion put forward by Kotler and Keller (2012: 143) that product quality is a characteristic and totatilas feature of a product or service related to its ability to be able to meet the stated or implied needs. According to Mullins, Walkers, and Boyd in Tanuwijaya and Ashori (2013), there are 8 dimensions of product quality that are also indicators in this study include: 1. Feature 2. Realibility 3. Conformance 4. Durability 5. Serviceability 6. Aesthetics 7. Perceived Quality Satisfaction Kotler in Sunyoto's book (2013:35), consumer satisfaction is the level of one's feelings after comparing (perceived performance or outcome) compared to expectations. Consumers can experience one of the three levels of general satisfaction that if the performance is below expectations, consumers will feel disappointed but if the performance in accordance with customer expectations will feel satisfied and what if the performance can exceed expectations then the customer will feel very happy or happy. Customer satisfaction is the judgment that the form / model of a product or service, or product / service itself provides a level of fulfillment with respect to pleasant consumption (Tjiptono and Chandra, 2013: 196). Customer satisfaction indicators include: 1. Feeling of statisfaciton 2. Always buy a product 3. Help Reccomend 4. Fullfilment of customer expectations RESEARCH METHODS This research uses quantitative approach. Sugiyono (2012:55) argued that the quantitative approach is an approach to test the causality relationship between independent variables with dependent variable. Quantitative approach used in this research because data will be processed by using statistic. The research method used in this research is survey method. Based on calculations with the Slovin formula, then from 105 consumers / customers obtained about 83 consumers sampled in this study. Primary data collection techniques can be done by observation (observation), interview (interview), questionnaire (questionnaire), and the combination of all three. The data retrieval method used in this research was conducted by distributing questionnaires.

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Data analysis techniques in this study using multiple linear regression analysis techniques. Linear regression analysis is a barganda analysis performed to measure the strength of the relationship between 2 or more independent variables to the dependent variable. RESULTS AND DISCUSSION The purpose of this study is to determine the effect of service quality, price and product quality on customer purchasing satisfaction in buying Trend Tracer clothes. Therefore the researcher proposed 3 pieces of hypothesis, namely: H1: There is a significant effect of service quality on customer purchasing satisfaction. H2: There is a significant price effect on customer purchasing satisfaction. H3: There is a significant effect of product quality on customer purchasing satisfaction. The results of this research hypothesis testing will be explained as follows: 1. Effect of service quality on consumer satisfaction Trend Tracer The significance value of t statistic from the influence of Quality of Service variable (X1) to Consumer Satisfaction (Y) is 0.000 <0,05. This shows that the quality of services provided Trend Tracer significantly partially influence on customer satisfaction. Therefore, the first hypothesis of this study is accepted, because the results of this study proved that there is a significant influence on service quality to customer purchasing satisfaction. The value of regression coefficient of service quality variable (X1) marked positive on the value of regression coefficient represents a direct relationship between service quality variable (X1) and consumer satisfaction (Y). This regression model shows that if the service provided Trend Tracer to the consumer increases one unit, then the customer satisfaction Trend Tracer will also experience an increase of 0.652. Therefore, the results of this study support the findings of research Gulla et al (2015) and Margareth (2014), which also proves that service quality has a positive and partially significant effect on customer satisfaction. Where, customer satisfaction is the level of one's feelings after comparing (perceived performance or outcome) compared to expectations (Sunyoto, 2013:35). 2. Price effects on customer satisfaction Trend Tracer The significance value of t statistic from the influence of Price variable (X2) to Consumer Satisfaction (Y) is 0.013 <0.05, which means that the price of the product offered Trend Tracer to the consumer has a significant partial effect on customer satisfaction. Therefore, the second hypothesis of this study is accepted, because the results of this study proved that there is a significant effect of price on customer purchasing satisfaction. The value of regression coefficient of Price variable (X2) with negative sign on regression coefficient value represents unrelated relationship between Price variable (X2) and Consumer Satisfaction (Y). This regression model shows that if the price of the product offered by Trend Tracer to the consumer increases one unit, Trend Tracer's customer satisfaction will decrease by 0.191. The results of this study support the findings of research Mahmud et al (2013) which shows a partially significant negative relationship of the variable price to customer satisfaction. 3. Effect of product quality on customer satisfaction Trend Tracer The significance value of t statistic from the effect of Product Quality (X3) variable on Consumer Satisfaction (Y) is 0.000 <0,05. This shows that the quality of Trend Tracer product has a significant effect partially on customer satisfaction. Therefore, the third hypothesis of this study is accepted, because the results of this study proved that there is a significant effect of product quality on customer purchasing satisfaction. The value of regression coefficient of product quality variable (X3) with positive sign on the regression coefficient value represents a direct relationship between product quality variable (X3) and consumer satisfaction (Y). This regression model shows that if the quality of Trend Tracer's product increases one unit, Trend Tracer's customer satisfaction will also increase by 0.252. Therefore, the results of this study support the findings of research by Margareth (2014), Purnamasari (2015) and Jahanshahi (2014), which also proves that product quality has a positive and partially significant effect on customer satisfaction.

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Overall, the significance value of F statistics is 0.000 <0.05. The results of this study indicate that the quality of service, price and product quality, together have a significant influence on customer satisfaction Trend Tracer. The value of unstandardized coefficients of the regression model also shows that when Trend Tracer improves service quality, decreases product prices, and improves product quality, it will also increase customer satisfaction on services, prices and products offered Trend Tracer. CONCLUSION Result in this research can be concluded that, there is influence from service quality variable significantly to satisfaction of consumer purchase Trend Tracer. The effect that occurs is positive so that it can be stated that the quality of service positively significant has a contribution in affecting the consumer purchase satisfaction Trend Tracer. Furthermore, there is influence of price variables significantly to customer purchase satisfaction Trend Tracer. The effect that occurs is negative so it can be stated that the price is negatively significant has a relationship that is not in line with the consumer purchase satisfaction Trend Tracer. And there is influence of variable of product quality significantly to satisfaction of consumer purchase Trend Tracer. The effect that occurs is positive so that it can be stated that the quality of the product positively significant has a contribution in influencing the satisfaction of consumer purchase Trend Tracer. REFERENCES Daryanto. (2013). Sari Kuliah Manajemen Pemasaran. Edisi 2. Bandung: PT. Sarana Tutorial Nurani Sejahtera. Gulla, R., Oroh, S.G., & Roring, F. (2015). Analisis Harga, Promosi, Dan Kualitas Pelayanan Terhadap Kepuasan Konsumen Pada Hotel Manado Grace Inn. Jurnal Riset Ekonomi, Manajemen, Bisnis dan Akuntansi, III (1), pp. 1313-1322. Jahanshani, et al. (2014). Study the effects of customer service and product quality on customer satisfaction and loyalty. International Journal of Humanities and Social Science, I (7), pp. 253-260. Kemenperin (2015). ‘Menperin Membuka Idonesia Fashion Week 2015’. Available at: http://www.kemenperin.go.id/artikel/11243/Menperin-Membuka-Indonesia-FashionWeek-2015 (Accessed: 14 April 2016). Kotler, P. & Amstrong, G. (2012). Principles of Marketing. New Jersey: Pearson Education Limited. Kotler, P. & Keller, K.L. (2012). Marketing Management. New Jersey: Pearson Education Limited. Mahmud, A., & Jusoff, K. (2013). The Effect of Service Quality and Price on Satisfaction and Loyalty of Customer of Commercial Flight Service Industry. World Applied Sciences Journal, XXIII (3), pp. 354-359. Purnamasari, I.G.A.Y. (2015). Pengaruh Kualitas Produk Dan Harga Terhadap Kepuasan Konsumen Produk M2 Fashion Online Di Singaraja Tahun 2015. Jurnal Jurusan Pendidikan Ekonomi (JIP), V (1), pp. 1-12. Runtunuwu, J.G., Oroh, S., & Taroreh, R. (2014). Pengaruh Kualitas Produk, Harga, Dan Kualitas Pelayanan Terhadap Kepuasan Pengguna Café Dan Resto Cabana Manado. Jurnal Riset Ekonomi, Manajemen, Bisnis dan Akuntansi, II (3), pp. 1803-1813. Sagita, F.E. (2013). Pengaruh Brand Image Dan Harga Terhadap Keputusan Pembelian Ulang Produk Kentucky Fried Chicken (KFC) di Cabang Basko Grand Mall Oleh Mahasiswa Negeri Padang. Jurnal Management, II (2), pp. 152-163. Sugiyono. (2012). Metode Penelitian Kuantitatif, Kualitatif dan R&D. Bandung: Alfabeta.

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Tanuwidjaja, M. & Ashori, M.Y. (2013). Pengaruh Kualitas Layanan Dan Kualitas Produk Terhadap Kepuasan Pelanggan Pipop Copy. Jurnal NeO-Bis, VII (1), pp. 1-16. Tjiptono, F. & Chandra, G. (2011). Service, Quality & Satisfaction. Edisi 3. Yogyakarta: C.V Andi Offset. Tjiptono, F. & Chandra, G. (2013). Service, Quality & Satisfaction. Edisi 2. Yogyakarta: C.V Andi Offset.

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