RELEVANCE:
Journal of Management and Business ISSN .
: 2615-8590 ISSN .
: 2615-6385 The Role of Entrepreneurial Motivation and Social Network Relationship on Business Performance of Herbal Medicine Sellers Dwi Hastuti1 Prodi Manajemen Bisnis Syariah.
Fakultas Ekonomi dan Bisnis Islam.
UIN Raden Mas Said Surakarta.
Indonesia denisdwi222@gmail.
Fitri Wulandari2* Prodi Manajemen Bisnis Syariah.
Fakultas Ekonomi dan Bisnis Islam.
UIN Raden Mas Said Surakarta.
Indonesia Fitri.
wulandari@iain-surakarta.
Abstract The purpose of this study is to analyze the effect of entrepreneurial motivation and social network relationship on the business performance of herbal medicine sellers.
The object of this research was the sellers of herbal drink/the peddler of biopharmaca/herbal medicine store in Banyu Urip Surabaya and surrounding areas.
The sampling technique used purposive sampling technique with a total sample of 91 The data analysis method applied regression analysis with the help of IBM SPSS software version 21.
The results indicate that there is a positive and significant influence of entrepreneurial motivation on the business performance of herbal medicine However, social network relationships have a positive and insignificant effect on improving the business performance of herbal medicine sellers.
This research provides the strong motivation for entrepreneurs to improve their business performance becoming autonomy and independence.
This means that the desire to work independently, to develop their own business, and to have financial independence are the strongest impetus for them to be successful in business indicated by better financial Keywords: Motivation, social relationship, performance, herbal medicine seller Introduction Empowerment and sustainable development of Micro Small and Medium Enterprises (UMKM) not only causes the growth in number but also the development in the quality and competitiveness of its products.
UMKM is not difficult to create products and services because it already has its own uniqueness in innovating.
However, not all UMKM has a high entrepreneurial orientation to be able to maintain its business continuity.
The low productivity of UMKM is caused by some problems, including the low of entrepreneurial orientation, marketing and business networks, mastery of technology, quality of human resources, to government support and capital aspects (Tambunan, 2.
The activity carried out by entrepreneurs is to pursue business in UMKM sector.
The roles of UMKM are to provide various opportunities RELEVANCE: Journal of Management and Bussines n Vol.
4 n No.
2 n Page.
110-127n 2022 including the contribution in reducing unemployment and encouraging economic growth for the government (Kusakina et al.
, 2.
This is in line with Tambunan .
which explains that UMKM growth is included as an important element of national policy in increasing job opportunities and alleviating poverty.
UMKM has a labor-intensive in nature, so it has a great potential in encouraging labor growth, be able to survive in times of crisis compared to large businesses.
Another advantage of UMKM is the concentration of business in producing goods for consumption at relatively cheap prices.
Therefore UMKM can meet the needs of various levels of society with different incomes.
One essential variable supporting this research is social capital.
UMKM is very familiar with social capital.
Social capital such as mutual cooperation activities, kinship relationships, building networks and interpersonal relationships, and built from mutualistic interactions based on building mutual trust.
This is in line with Effendy's .
that the capital of UMKM business is as important as money capital.
The business activities built by UMKM are embedded in the structure of the community and family with social norms and sanctions.
In line with the view of Tsai & Sumantra .
that social capital is a social exchange determined from social interaction, trust and building a social vision along with standard In a business network, social capital becomes an important network that encourages UMKM to succeed.
However, social capital is a capital that has received relatively little attention compared to other capital, while UMKM often has limitations in both vertical and horizontal networks (Widodo, 2.
Every entrepreneurs have motivation, although the difference found in their motivation to start a business.
According to Amadea & Riana, .
motivation plays an important role in business success.
Motivation in several studies is considered as the driving force for a businessman to succeed (Amadea & Riana, 2020.
Harie & Andayanti, 2.
Entrepreneurial motivation encourages entrepreneurs to take action to realize their vision and goals (Yuritanto, 2.
Motivation in business is not only in the form of self-confidence, but also a strong motivation for entrepreneurs to improve their ability to do business, the ability to access various information about business opportunities and challenges faced by Thus, entrepreneurial motivation is an important factor that must be owned by an entrepreneur.
One of the store centers for the peddler herbal medicine and various types of herbal medicines is located in Banyu Urip Surabaya and its Herbal medicine/biopharmaceutical products are getting more attention because the trend and potential demand for herbal medicine/biopharmaceuticals tends to increase in turnover.
During this pandemic, public demand for herbal medicines has increased significantly.
According to data from the Ministry of Trade in 2020, in the next five years the herbal/biopharmaceutical industry will grow about 6.
7% annually with a projected turnover of $218.
940 billion in 2026.
Indonesia has the 19th position as an exporting country for herbs/biopharmaceuticals, where the highest exporter world are India .
5%) and China .
6%) (Ministry of Trade, 2.
The herbal/biopharmaceutical industry is generally a micro and small industry.
The approach to production is through a group or center or cluster approach.
In the cluster approach, support .
oth technical and financia.
is channeled to Small.
Medium enterprises (UKM) groups, not to individual of UMKM.
The group approach is believed to be better because the individual UMKM is generally unable to capture market opportunities, and also because the established business network has proven to be more effective in increasing business competitiveness because of its ability to synergize between UMKM.
According to M.
Porter .
cluster is a network owned by companies where the network is usually geographically concentrated, such as clusters of suppliers, service and service providers, industrial clusters, and association institutions in certain areas that compete with each other, but also cooperate with each other.
Review of Literature Social network relationship The ability to build social network relationships, both internal and external networks, is an important asset for the company's business growth.
With social network relationships a variety of new knowledge, skills and important information needed in business can be fulfilled easily.
Social network relationships as an important network in business assist companies to obtain raw materials, labor, and share ideas and knowledge more quickly.
Social network relationships will be very useful, considering that UMKM in general has limited capital resources so that gathering resources from close friends, family or colleagues is an alternative for advancing the business to develop (Asamoah et al.
, 2.
Kang et al.
, .
investigating social network relationships reveals that there are two types of business relationships encompassing internal and external networks.
The internal network includes the relationships built closely within the organization such as social ties between various departments within the organization, the relationship between superiors and subordinates.
Meanwhile, external relationship is built through interactions outside the organization including interactions with competitors, suppliers, and Entrepreneurial Motivation Entrepreneurial motivation is an impulse arising from an entrepreneurial person to carry out activities related to the field of According to Amadea & Riana, .
and Ogunleye & Osagu, .
motivation has a goal to support the characteristics of an entrepreneur, including hardworking, never giving up, having passion, and commitment.
According to Wulandari et al.
, .
entrepreneurial motivation is oneAos belief to successfully face various challenges.
He also believes that great opportunities will be achieved, and what he wants to achieve will definitely succeed.
Entrepreneurial motivation is manifested in the form of pursuing opportunities to become an owner, having freedom/autonomy and high flexibility in work, ambition to earn more income, opportunity to learn new things, to like challenges and to have high achievement needs.
This is reinforced by Lee & Stearns .
and Wulandari et al.
, .
indicators used to measure entrepreneurial motivation include high entrepreneurial opportunities that will encourage a person's desire to choose a job as an entrepreneur.
Supported by Nursiah & Kusnadi .
how to measure business opportunities is to analyze strengths, weaknesses, opportunities and threats.
The opportunity contains harmony, and conformity between who we are, what business to enter, how the market is, as well as market conditions, situations, and behavior in the business we are engaged in.
Autonomy and business independence is the state of a person who can stand alone without depending on others (Austhi, 2.
This means that independence must be owned by a person to realize the needs of his life.
This includes the courage qualities to take business risks, virtue, example and belief in one's own abilities (Sukirman, 2.
The entrepreneurial challenge according to Kasidi, .
and Nuraeningsih et , .
is to maintain an ongoing business as a challenge that must be faced by businessmen.
Strong motivation in entrepreneurship is by seeing various opportunities and challenges, and trying to take concrete actions in entrepreneurial activities.
Santosa .
states that several challenges faced by the businessmen, including: limited ability to run a business, limited knowledge, lack of initiative in dealing with problems, lack of experience and fear of taking risks.
Bussiness Performance According to Wulandari et al.
, .
the indicator of business success in this research is an increase in product sales.
In this case, this depicts how entrepreneurs can improve the products more than competitors' products.
The second is the increase in business growth that is currently running from the beginning experiencing growth in accordance with the desired expectations.
The last, the increase in the marketing area.
This means the expansion of the marketed area having a positive impact on the number of products and increase income.
This is in line with Agusdin et al.
, .
that business performance is measured by business growth, total sales, market share and profitability.
Marketing performance is considered as a concept to measure a person's success in running a business.
The effect of entrepreneurial motivation on bussiness performance of herbal medicine sellers According to Gemina et al.
, .
the effect of entrepreneurial motivation on business success, using path analysis with the research object of snack business management shows that entrepreneurial motivation has a positive and significant effect on business ability.
The entrepreneurial motivation is built because of a strong desire to get higher financial rewards.
This motivation has the opportunity to determine the ownersAo destiny by controlling their business independently, realizing their dreams or aspirations to become successful entrepreneurs.
In line with Sukirman's, .
the value of entrepreneurship starts from building self-confidence by forming confidence, optimism, commitment, discipline, and responsibility in running a business.
This is also supported by Prabandari & Rosita, .
that motivation and competence have a simultaneous effect on the success of women entrepreneurs, and motivation has a dominant influence on the success of women entrepreneurs.
H1: The higher entrepreneurial motivation, the higher business performance of herbal medicine sellers The effect of social network relationship on bussiness performance of herbal medicine sellers According to Wu et al.
, individuals build relationships both internally and externally with the aim of gaining valuable new experiences, new knowledge and new ideas relevant to business development.
The relationship closeness causes someone to want to share his experiences and knowledge through good interactions or relationships because of emotional This is in line with Naif Marouf .
examining the strength of business relationships, compared to the strength of social relationships and their contribution to knowledge sharing and business performance.
The research findings indicate that both business and social relationships will affect business performance, but this depends on the frequency of The findings of this study confirm that both social interaction and work interaction have an effect on improving business performance.
The study of Zeng et al.
reveal a significant positive effect of cooperation between UMKM and collaboration with intermediary institutions in improving UMKM innovation performance.
The collaboration among several UMKM have the most significant positive impact on UMKM innovation performance.
The results of the study strengthen Muafi .
showing that social capital has a positive impact on the innovation and performance of UMKM.
H2: The Higher Social Network Relationship.
The Higher Business Performance of Herbal Medicine Sellers Research Method Population.
Sample, and Sampling Technique The population in this study were herbal medicine sellers from the Association of herbal medicine sellers in Banyu Urip Surabaya and its The sample is part of the population representing the whole object under study.
This sampling is based on the fact that in a scientific research there is no absolute necessity or not all populations must be studied, only part of the population can be studied.
According to Imam Ghozali, .
for research using statistical data analysis, the minimum sample size is 30.
This is chosen with the consideration that the researcher has limited ability in terms of cost, time and effort.
The number of respondents in this study were 91 herbal medicine sellers in Banyu Urip Village.
Sawahan District.
Surabaya City.
The sampling technique applied purposive sampling method, by taking samples from the population based on certain criteria, including:
The herbal medicine sellers/herbal medicine store in the Banyu Urip area.
Sawahan District.
Surabaya.
The herbal medicine sellers were those who have been running their business for at least 2 years.
Measurement of Research Variables Entrepreneurial motivation is the impetus used by a person to increase entrepreneurial opportunities, independence, income, and entrepreneurial challenges.
Meanwhile, according to Lee & Stearns .
dan Wulandari et al.
, .
the indicators used to measure entrepreneurial motivation include entrepreneurial opportunities, autonomy and independence in entrepreneurship, and the challenges of entrepreneurship.
Social network relationships are those possessing competencies including knowledge, skills, and individual qualities.
These qualities include attitudes, motivations, personal values and behaviors needed to carry out work or activities.
Kang et al.
, .
argues that social network relationships are measured from building close relationships from the organization such as social bonds between employees in the organization, superior and subordinate relationships, building interactions with suppliers, customers, and herbal medicine associations.
Business performance is the goals achievement before starting a business that meets the expected targets.
This can be seen from the development of the increasing number of production.
Furthermore, business success will not be separated from profit because profit is the expected target before starting a According to Agusdin et al.
, .
and Wulandari et al.
, .
the indicators include the increased on product sales, business growth, business operating income, and marketing area.
The data was analyzed using IBM SPSS software version 21 Results Respondent Characteristics Table 1.
Respondent Characteristics Based on Gender Sex Numbers Percentage Male Female 85,72% Total Age Numbers Percentage 20-29 years 30-39 years 40-49 years 50-59 years Total Experience Numbers Percentage <6 years 6-10 years 11 to 15 years Total Capital Numbers Percentage 10-20 Million 20-40 Million >50 Million Sex Numbers Total Source : Primary Data Processed in 2022 Percentage Based on table 1, the male respondents are 13 people .
28%), and the female are 78 people .
72%).
The characteristics of respondents based on age are 2 people of 20-29 years old .
%), 30 people of 30-39 years old .
9%), 51 people of 40-49 years old .
%) and 8 people of 50-59 years old .
1%).
The largest number for characteristics of respondents based on age are those who are 40-49 years old .
%).
Based on table 1, it reveals that there are 30 people of <6 experience years .
96%), 51 people of 6-10 experience years .
%), and 10 people of 11-15 experience years .
04%).
Thus, the characteristics of respondents based on experience are those with work experience between 6-10 years .
%).
And based on table 1, it shows that there are 19 people with business capital between 10-20 million .
8%),
69 people with 20-40 million .
8%), and 3 people with >50 million ( 3.
4%).
Therefore the characteristics of the respondents based on the amount of business capital are those with a capital between 20-40 million .
8%).
Test of Validity and Reliability Table 2.
Results of Validity and Reliability Test Indicator raccoun rtable CronbachAos Alpha Social I make good =0.
relationship other herbal medicine sellers to share new experiences and I make good interactions with employees/familie s who assist my I make good interactions with my customers I make good interactions with my herbal Variable Description Valid and Valid and Valid and Valid and Variable Indicator Entreprene Motivation Business Performanc I make good interactions with herbal medicine sellers in a wider I feel that pursuing a job as an entrepreneur is my biggest dream I want to make my own money and be independent I want to have freedom/autonom y with I want to realize my ambition to grow my business CronbachAos Alpha Description Valid and Valid and Valid and Valid and I firmly believe that my business will continue to grow and progress Valid and I am passionate, unyielding and hard worker Valid and I really like My profitability always increases every year My business development is always improving Valid and Valid and Valid and Valid and Variable Indicator My market share is better than last My product is preferred by the market compared to competitors Source : Primary Data Processed in 2022 CronbachAos Alpha Description Valid and Valid and Based on the test in table 2 for the validity test above, it shows that all statement items in the questionnaire are worth rcount > rtable .
, so all statements in the variables studied are declared valid.
Based on the test in table 5 for the reliability test, it indicated that all variables have an CronbachAos Alpha Ou 0.
6, so it can be concluded that the overall statement items of each variable in this study are reliable.
Classical Assumption Test Results Normality Test Table 3.
Results of Normality Test Variable P value Description Unstandardized Residual Data is normally distributed Source : Primary Data Processed in 2022 The calculation results of Kolmogrov Smirnov (K-S) table 3 show that the significance value .
is > 0.
in the unstandardized If it is seen from the PP plots curve, it shows that the data spreads around the diagonal line and follows the direction of the diagonal line or histogram graph.
So, it meets the assumption of normality.
Multicollinearity Test Table 4.
Multicollinearity Test Results Tolerance VIF Variable Entrepreneurial Social Source: Primary Data Processed in 2022 Description no multicollinearity no multicollinearity Based on table 4 above, it shows that each variable has a VIF value of 1-10 and a tolerance value < 1.
This indicates that there is no multicollinearity problem in the regression model.
Heteroscedasticity Test To investigate the heteroscedasticity from the level of significance, the Glejser test or absolute residual of the data can be used.
If the level is above 5%, it means that there are no signs of heteroscedasticity.
If it is below 5%, it means that there is heteroscedasticity.
Table 5.
Heteroscedasticity Test Result
Variable t count
Sig
Entrepreneurial ,182 Social
,024
Source : Primary Data Processed in 2022 Description no heteroscedasticity no heteroscedasticity Figure 1.
The Result of Scatterplot of Heteroscedasticity Test However, based on the scatterplot, it can be concluded that the regression model is free from the assumption of heteroscedasticity because the data do not form a pattern.
Test of Model Accuracy F Test Simultaneous test or F test is a joint test to test the significance of the influence between the entrepreneurial motivation and social network relationship on business performance.
Table 6.
Result of F Test Sum of Mean Square Squares Regression Residual Total Dependent Variable: Bussiness Performance Predictors: (Constan.
KW.
MU Source : Primary Data Processed, 2022 Model Sig.
Based on the results of the F test shown in Table 6, the F value with a significant value of < 0.
086 > 0.
It can be concluded that entrepreneurial motivation and social network relationship to the dependent variable of business performance from the selected regression model have not been properly used in this study.
However, using a significant assumption of 10% or 0.
10 which means .
086 < 0.
, then the appropriate research model is used to analyze the effect of entrepreneurship motivation and social network relationship on the dependent variable of business Coefficient of Determination Test (R.
Table 7.
Result of Determination Coefficient (R.
Model R Square Adjusted R Std.
Error of Square the Estimate Source : Primary Data Processed, 2022
DurbinWatson
1,876
Based on the results of the analysis shown in table 7, it can be seen that the value of Adjusted R square is 0.
This means that the value of the dependent variable can be explained by the independent variable by 3%, the remaining variables outside the model are 97%.
T Test The t-test is used to test the significance effect of each independent variable on the dependent variable.
This test uses a level of significance () This means that the probability of getting the t value located in the critical area .
ejection are.
if the true hypothesis is 0.
If t count is > t table then Ho is rejected, indicating that there is an influence between the independent variables on the dependent variable.
Table 8.
Multiple Regression Analysis Results Variable Unstandardize TSig Description d Coefficients Count (Constan.
Entrepreneurial 050 Significant Social network 604 Not significant Source : Primary Data Processed, 2022 The results of the t-test analysis for the entrepreneurial motivation obtain a probability value of 0.
05, then Ho1 is rejected and Ha1 is accepted.
This means that entrepreneurial motivation has a significant positive effect on the business performance of herbal medicine sellers.
The results of the ttest analysis for variables in social network relationships obtain a probability value of 0.
604, which means greater than 0.
Then Ho1 is accepted and Ha1 is rejected indicating that the social network relationship has no significant effect on the business performance of herbal medicine Discussions The results reveal that there is a significant influence of entrepreneurial motivation on the business performance of herbal medicine The positive value of the regression coefficient for entrepreneurial motivation indicates that the higher the entrepreneurial motivation of herbal medicine sellers, the higher the opportunity for them to achieve business success.
This is supported by the research of Wulandari et al.
showing that there is a significant influence between entrepreneurial motivation on business performance.
The strongest entrepreneurial motivation factor for entrepreneurs is a strong desire to have a successful In addition, the business currently being occupied has a good Moreover, other motivations are freedom and flexibility, the desire to make more money, autonomy, the desire to realize personal ambitions, personal challenges, and the need for job performance.
In line with the research of Megracia .
the strongest entrepreneurial motivation for entrepreneurs is seen from being an entrepreneur because they have a desire to be rich or have financial The business performance variable can also be seen from the question that business has the ability to compete.
In line with the research of Yunal & Indriyani, 2.
entrepreneurial motivation has an effect on business performance.
This can be noticed from the respondents' answers to the questionnaire presented in the frequency table showing answers that are on average in the high category in answering the question of entrepreneurship motivation.
So it can be concluded that businessmen generally have high motivation in carrying out entrepreneurial activities so that they have good business performance seen from increased business growth, increased profitability and competitive ability.
The results indicate that the effect of social network relationship on the business performance of herbal medicine sellers is positive and not The results of this study are not in line with the opinion of Choi, .
It reveals social capital is needed both from structural and behavioral In the structural aspect, social relations are needed to get information, suggestions for improvement, and other constructive input from people closest to who understand the same business.
Meanwhile, from the behavioral aspect, it is an effort how to have good quality relationships with others in the form of a relationship based on a high level of trust and reciprocal relationships from both parties that are mutually beneficial .
n line with applicable norm.
It is clear from arguments about the role of social networking relationships in improving performance, that trust in relationships and relational norms will effectively enhance social exchange relationships and potentially encourage mutually beneficial business The findings of Agyapong et al.
, .
discussing the influence of social network relationships on business performance also do not support the results of this study.
The role of social network relationships in the form of ties and connections in the organization will strengthen internal and external networks and try to utilize these social networks for wider However, the results of this study are supported by Pratono, .
that social networking does not automatically improve business performance, due to the important role of mediating trust and commitment in building relationships such as lasting interactions in the long term and also reducing harmful conflicts (Salam, 2.
Conclusion The entrepreneurial motivation has a significant positive effect on the business performance of herbal medicine sellers, while social network relationships have no significant effect on the business performance of herbal medicine traders.
The biggest significant result is the entrepreneurial motivation variable.
This study used a limited sample, including herbal medicine UMKM in Surabaya.
To develop further research can expand the sample to UMKM in all sectors.
This study also has limitations because one of the variables .
ocial network relationshi.
has a positive but not significant effect.
The results show the Adjusted R Square value of 0.
%).
This means that the independent variables include entrepreneurial motivation and social network relationships affect business performance by 3%, while the remaining 97% is influenced by other variables not examined in this research model.
Further research can include other variables obtained from a more complete variety of variables that can affect entrepreneurial success such as entrepreneurial orientation, business innovation, or developing the concept of entrepreneurial motivation and social network relationships with different measurements.
References