JManagER
Journal of Management, E-Business & Entrepreneurship Research
Vol. 02 No. 02 2023

The Factors That Encourage People in Makassar City to Become
Micro, Small and Medium Entrepreneurs
Rasyid Kamase, S.E., M.Si1)
Lita Limpo, S.E., M.Si., Ph.D2)
1)

Psychology Department, Universitas Atma Jaya Makassar
Management Department, Universitas Atma Jaya Makassar
Jl. Tanjung Alang No. 23, Makassar
Kamaserasyid99@gmail.com1), litalimpo3@gmail.com2)

2)

ABSTRACT
Micro, small and medium enterprises (MSMEs) are one of the factors that drive the
economic growth and development in Indonesia where the contribution of MSMEs to Gross
Domestic Product which is 61.07% or 8.573,89 trillion rupiahs, collecting 60.42% of total
investment in Indonesia. MSMEs are also able to absorb as much as 97% of the total existing
workforce. However, the number of MSMEs in Makassar City can still be said to be quite low
compared to several other areas in South Sulawesi. This shows that the people of Makassar City
have not fully obtained or found encouragement in running MSMEs even though MSMEs
themselves have many benefits not only for the country’s economic growth but also for the
business owners themselves.
The purpose of this research is to find out what factors encourage people in Makassar
City to become MSMEs business owners so that it can be used as material for consideration in
encouraging or motivating someone to form or enter MSMEs Business in Makassar City. This
research found that the factors that had encourage people in Makassar City to become MSMEs
business owners are consisting the passion or desire they have to do business, family, the
independence they get in running a business, income, and self-development obtained when
running a business such as new knowledge or talent development.
Keywords: MSMEs, Factors that encourage to become MSMEs business owners

1.

INTRODUCTION

Micro, small and medium enterprises (MSMEs) are one of the factors that drive the economic
growth and development in Indonesia, this is because most business actors in Indonesia are actors
engaged in MSMEs (sirclo.com). MSMEs themselves are a people’s economy based on local
wisdom whose existence can be used as a foundation for economic growth in Indonesia where
this is evidenced by the total contribution of MSMEs to Gross Domestic Product which is 61.07%
or 8.573,89 trillion rupiahs, collecting 60.42% of total investment in Indonesia. MSMEs are also
able to absorb as much as 97% of the total existing workforce so this causes the government to
be committed to continuing to encourage and support MSMEs (kemenkeu.go.id).
Right now, MSMEs are one of the sectors that are experiencing quite rapid growth from year
to year where based on the data obtained through the Ministry of Cooperatives and Small and
Medium Enterprises in March 2021, the number of MSMEs recorded was 64.2 million
(kemenkeu.go.id). In South Sulawesi alone, the number of recorded MSMEs is 176.637 units
(diskop.id) which can be seen in more detail in table 1.

27

JManagER
Journal of Management, E-Business & Entrepreneurship Research
Vol. 02 No. 02 2023

Table 1
Number of MSMEs in South Sulawesi
Kabupaten/Kota
Amount (unit)
Bantaeng
10.769
Barru
33.831
Belopa
10.985
Bone
18.510
Bulukumba
4.640
Enrekang
312
Gowa
100
Jeneponto
9.636
Luwu Timur
987
Luwu Utara
22.555
Makale
238
Makassar
1.654
Maros
1.633
Palopo
6.434
Pangkep
287
Pare-pare
1.000
Pinrang
22.483
Selayar
23.435
Sidrap
593
Sinjai
750
Soppeng
1.221
Takalar
196
Torut
3.443
Wajo
954

Source: diskop.id (2018)
Based on Table 1, we can see that the number of MSMEs in Makassar City is still quite low
compared to several other areas in South Sulawesi such as Bantaeng, North Luwu, Pinrang,
Selayar, and Bone even though the population in Makassar City is higher than other areas in South
Sulawesi (databox.katadata.co.id). This shows that residents in Makassar City have not fully
obtained or found encouragement in running MSMEs even though MSMEs themselves have
many benefits not only for the development and growth of the country’s economy but also for the
business actors themselves.
The purpose of this research is to know the factors that encourage people in Makassar City
to become MSME entrepreneurs so that it can be used as a consideration in encouraging or
motivating someone to form or establish an MSME business in Makassar City. The expected
result is to provide benefits in consideration of encouraging or motivating someone to form or
establish an MSME business so that MSMEs can grow and develop.
Through searches conducted by researchers, various factors were found that encourage
someone to run MSMEs: education, family, independence, capital, income, self-development,
entrepreneurial experience, and government. Seeing that there are many factors that encourage

28

JManagER
Journal of Management, E-Business & Entrepreneurship Research
Vol. 02 No. 02 2023
someone and the differences in the areas studied in previous studies with the ones that will be
studied by researchers makes this research carried out using an exploratory approach in order to
find the main factors that encourage someone to run an MSME business, especially in the
Makassar City area.
2. THEORETICAL BASIS
2.1. Micro, Small, Medium and Enterprises (MSMEs)
Minister of Finance Decree Number 40/KMK.06/2003 of January 29 2003 describes Micro
and Small Enterprises as follows:
1. Micro enterprises are productive businesses owned by families or individuals and have
sales proceeds of IDR 100.000.000 (one hundred million).
2. Small businesses are productive businesses owned by Indonesian Citizens in the form of
individual business entities, business entities that are not legal entities, or business entities
that are legal entities including cooperatives; is not a subsidiary or branch of a company
that is owned, controlled or affiliated, either directly or indirectly, with a medium or large
business, and has a maximum net worth of IDR 200.000.000 (two hundred million
rupiahs), not including land and buildings or has sales of IDR 1.000.000.000 (one
billion/year).
Constitution No 9 of 1995 describes Medium Enterprise as economic activities that have
criteria for net worth or annual sales results that are greater than the net worth and annual sales
results of small businesses.
2.2. Factors that Encourage MSMEs
Through searches conducted by researchers, various factors were found that encourage
someone to try which can be described as follows:
a. Education
According to Mantik, Tewal, and Dotulong (2020), education essentially has the goal of
changing the behavior, attitude, or character of educational goals. Furthermore, Mantik et.
al. (2020) explained that education, especially related to the field of business, is believed to
influence their desire and interest in starting new businesses in the future. Fayolle and Gailly
(2015); Adekiya and Ibrahim (2016); Khuong and An (2016); Walter and Block (2016); Nabi,
Fayolle, Krueger and Walmsley (2017); Jegede and Nieuwenhuizen (2020) who say that
when someone undergoes some form of entrepreneurship training, they will also develop a
tendency to start their own business.
b.

Family
Irawati and Sudarsono (2020), said that family background supports or causes someone to
become an entrepreneur. If parents are entrepreneurs in a particular field, it will generate
interest in their children to become entrepreneurs in the same business (Mantik, et. al, 2020)

c.

Independence
Independence is an ability to stand alone. According to Irawati and Sudarsono (2020) a
person is motivated to become an entrepreneur because they wants to be independent.
Research conducted by Putri, Ghina and Wahyuni (2020) found that independence has an
influence on motivation in opening a business.

d.

Capital

29

JManagER
Journal of Management, E-Business & Entrepreneurship Research
Vol. 02 No. 02 2023
Capital is funds or money owned by someone and used to open a business. Research
conducted by Putri et. al (2020) found that capital has an influence on motivation in opening
a business.

e.

Income
Income arises after carrying out an activity or action. According to Irawati and Sudarsono
(2020) a person is motivated to become an entrepreneur because he wants to have the
appropriate income and wealth. Research conducted by Aimasari and Ghina (2015) shows
that income is the most dominant variable in motivating people to open a business.

f.

Self-development
Self-development is an activity that aims to increase self-awareness, develop talents and
potential, and improve quality of life. In research conducted by Aimasari and Ghina (2015),
self-development has an influence on motivating someone to become an entrepreneur.

g.

Entrepreneurial Experience
According to Mantik et. al (2020), the entrepreneurial experience will be gained by someone
who is directly involved in carrying out entrepreneurial activities.

h.

Government
Government is the political system by which a country or community is administered and
regulated. In research conducted by Aimasari and Ghina (2015), the government has an
influence in motivating someone to become an entrepreneur.

3.

RESEARCH METHODS

3.1. Population and Sample
The population in this study consisted if two categories, which are:
a. MSME Business Owners
b. Experts or academics who understand MSME
Determination of the number of samples in this study is based on Cresswell and Cresswell
(2018) who state that if a study is social science research with a qualitative design, the number of
research participants between 6-12 people is considered to fulfill the research requirements. The
number of samples taken in this study was 6 people with a sampling technique called nonprobability sampling, namely purposive sampling. Identification of categories and interview
participants in this study are described as follows:
Table 2
Number of MSMEs in South Sulawesi
No
Categories
Amount (unit)
1
MSME Business Owners
4
2
Experts or academics who understand MSME
2
Source: processed by the researcher
3.2. Interview Guide
This study uses an interview protocol guide that concerns the factors that influence a person
in trying MSMEs. Interview guidelines in this study are as follows:
a. Opening questions, which are questions consisting of greetings and questions that create
a conducive atmosphere for the interview to be carried out.

30

JManagER
Journal of Management, E-Business & Entrepreneurship Research
Vol. 02 No. 02 2023
b. Transition questions, which are a number of introductory questions before entering the
core questions of the topic that the researcher wants to convey.
c. Core questions, are a number of main questions that the researcher wants to ask about
the main topic in order to achieve the research objectives.
d. Closing questions, is the final question that concerns the conclusion of all the core
questions and this question has the goal of reinforcing the participants’ opinion on the
main topic.
3.3. Data Analysis Technique
This research uses qualitative research which is based on interviews conducted by the
researcher with the samples. Data analysis using cross-case analysis which according to Neuman
(2014), there are three kinds of steps in analyzing the data, namely open coding, axial coding and
selective coding.

4.

RESULT AND DISCUSSION

4.1. Result
The factors that influence a person in running an MSME business as disclosed by the
participants have similarities with the factors that have been carried out in previous studies which
can be seen based on the results of the following stages:
Table 3
Open Coding Result
Code
Open Coding
A1
Not registering BLT
A2
The government has no effect
A3
Educational background has no effect
A4
Passion for doing business
A5
Influential family
A6
Independence
A7
Financial availability matters
A8
Income
A9
Gaining experience
A10
Capital that collected
A11
Gaining knowledge in managing a business
A12
Profit from business
A13
Owning own business
A14
Self-development
A15
Learning
A16
The desire to do business
Source: processed by the researcher
Based on the results shown in the table above, 16 keywords were obtained which then
through these 16 keywords a special theme was arranged using axial coding which are described
as follows:
Table 4
Axial Coding Result
Code
Axial Coding
B1
Passion
B2
Family

31

JManagER
Journal of Management, E-Business & Entrepreneurship Research
Vol. 02 No. 02 2023
B3
Independence
B4
Financial Availability
B5
Income
B6
Experience
B7
Gaining knowledge
B8
Self-development
B9
The desire to do business
Source: processed by the researcher
Based on the results shown in the table above, 9 special theme keywords are obtained where
the 9 themes are arranged so as to get more specific results namely as follows:
Table 4
Selective Coding Result
Code
Axial Coding
B1
Passion
B2
Family
B3
Independence
B4
Income
B5
Self-development
Source: processed by the researcher
4.2. Discussion
Based on the results of the research above, it can be seen that several factors influence MSME
business owners in Makassar City in forming and running MSME businesses which are consisting
the passion or desire they have to do business, family, the independence they get in running a
business, income, and self-development obtained when running a business such as new
knowledge or talent development.
The result of this study are in line with research conducted by Aimasari and Ghina (2015)
which explains that family, income, and self-development are driving factors in doing business.
Research by Mantik, Tewal, and Dotulong (2020), Irawati and Sudarsono (2020) stated that the
supporting factors were family and research conducted by Putri, Ghina, and Wahyuni (2020)
which said that independence was a driving factor in running a business. This research found a
new motivating factor, which is a passion that a person has that drives them to form and run a
business.

5.

CONCLUSION

Based on the research results obtained it can be concluded that:
a. Passion has an influence in encouraging people in Makassar City to become MSME business
owners.
b. Family has an influence in encouraging people in Makassar City to become MSME business
owners.
c. Independence has an influence in encouraging people in Makassar City to become MSME
business owners.
d. Income has an influence in encouraging people in Makassar City to become MSME business
owners.
e. Self-development has an influence in encouraging people in Makassar City to become MSME
business owners.

32

JManagER
Journal of Management, E-Business & Entrepreneurship Research
Vol. 02 No. 02 2023
Based on the results of the research and the conclusions obtained, the researcher’s suggestion
for this research is that future research should be carried out by examining the factors found in
this study using quantitative testing techniques in order to prove the truth of the factors driving
people in Makassar City to become MSME business owners.

REFERENCES
Adekiya, A.A., & Ibrahim, F. (2016). Entrepreneurship intention among students. The antecedent
role of culture and entrepreneurship training and development. The International Journal
of Management Education, 14(2), 116-132.
Aimasari, N., & Gihina, A. (2015). Analisis Faktor-Faktor yang Memotivasi Wanita Untuk
Menjadi Wirausaha (Studi Pengusaha Wanita UMKM di Kota Bandung Tahun 2015). eProceeding of Management 2(3) (pp. 2795-2799). Bandung: Telkom University
Creswell, J. W., & Creswell, J. D. (2018). Research Design Qualitative, Quantitative, and Mized
Methods Approaches. United States of America: SAGE.
Direktori UMKM. (2018). Retrieved from diskop.id: https://www.diskop.id/umkm-2/
Fayolle, A., & Gailly, B. (2015). The impact of entrepreneurship education on entrepreneurial
attitudes and intention: Hysteresis and persistence. Journal of small business management,
53(1), 75-93.
Irawati, S., & Sudarsono, B. (2020). Faktor Yang Memotivasi Perempuan Dalam Berwirausaha
Pada UMKM Kerupuk Sangnar di Kecamatan Kwanyar Kabupaten Bangkalan. Jurnal
Distribusi 8(2), 163-172.
Jegede, O. O., & Nieuwenhuizen, C. (2020). Factors Influencing Business Start-Ups Based on
Academic Research. Journal of Entrepreneurship Education 23(S1), 1-22.
Keputusan Menteri Keuangan No 40/KMK.06/2003
Khuong, M.N., & An, N.H. (2016). The factors affecting entrepreneurial intention of the students
of Vietnam national university-a mediation analysis of perception toward entrepreneurship.
Journal of Economics, Business and Management, 4(2), 104-111.
Mantik, J. C., Tewal, B., & Dotulong, L. (2020). Analisis Faktor-Faktor yang Mempengaruhi
Motivasi Berwirausaha Pada Pengusaha Kecil di Kota Manado. Jurnal EMBA 8(4), 370380.
Melihat Peran UMKM di Indonesia, Bagaimana Perkembangannya? (2021, November 19).
Retrieved from SIRCLO: https://www.sirclo.com/melihat-peran-umkm-di-indonesiabagaimana-perkembangannya/
Nabi, G., Liñán, F., Fayolle, A., Krueger, N., & Walmsley, A. (2017). The impact of
entrepreneurship education in higher education: A systematic review and research agenda.
Academy of Management Learning & Education, 16(2), 277-299.
Neuman, W. L. 2014. Basics of social research: Qualitative and quantitative approaches. Boston,
MA: Pearson.
Pemerintah Terus Perkuat UMKM Melalui Berbagai Bentuk Bantuan. (2021, September 27).
Retrieved
from
Kementerian
Keuangan
Republik
Indonesia:
https://www.kemenkeu.go.id/publikasi/berita/pemerintah-terus-perkuat-umkm-melaluiberbagai-bentuk-bantuan/
Putri, M. K., Ghina, A., & Wahyuni, T. A. (2020). Identifikasi Motivasi Anggota Pada Ikatan
Wanita Pengusaha Indonesia (IWAPI) Kota Bogor. e-Proceeding of Management 7(2) (pp.
5362-5367). Bandung: Telkom University.
Republik Indonesia. Undang-Undang No. 9 Tahun 1995 tentang Usaha Kecil

33

JManagER
Journal of Management, E-Business & Entrepreneurship Research
Vol. 02 No. 02 2023
Sensus Penduduk 2020: Jumlah Penduduk Sulawesi Selatan Sebanyak 9,07 Juta Jiwa. (2021,
Januari
21).
Retrieved
from
databoks:
https://databoks.katadata.co.id/datapublish/2021/07/23/sensus-penduduk-2020-jumlahpenduduk-sulawesi-selatan-sebanyak-907-juta-jiwa
Walter, S.G., & Block, J.H. (2016). Outcomes of entrepreneurship education: An institutional
perspective. Journal of Business venturing, 31(2), 216-233.

34