Market Orientation, Entrepreneurship and SME Performance: The Role of Product Innovation

Aims: This study aims to analyze market orientation, entrepreneurial orientation, and their impact on SME performance with product innovation as an intervening variable.

Study Design: Quantitative descriptive.

Place and Duration of Study: South Celebes, between January 2023 and October 2023.

Methodology: The population in this study were SMEs managing crabmeat in South Sulawesi. The research method used is a quantitative approach using a questionnaire as a data collection instrument, which was distributed to 132 samples selected from 395 populations using purposive sampling technique. The collected data were analyzed using regression analysis to test the relationship between the variables studied with the Smart PLS 3.2.9 application.

Results: The results showed that Market Orientation has a positive and significant effect on Product Innovation, Entrepreneurial Orientation has a positive and significant effect on Product Innovation, Product Innovation has a positive and significant effect on SME Performance, Market Orientation has a negative and insignificant effect on SME Performance, and Entrepreneurial Orientation has a positive and significant effect on SME Performance. In addition, Market Orientation has a positive and significant effect on SME Performance through Product Innovation, Entrepreneurial Orientation has a positive and significant effect on SME Performance through Product Innovation.

Conclusion: through product innovation efforts, SMEs can optimize the benefits of entrepreneurial orientation in achieving better performance.