Sustainability Study Of Small And Medium Industries Based On Local Wisdom In Denpasar City

Abstract

Small and Medium Industries are the foundation of the people's economy which plays a
role in channeling the creative and innovative spirit into superior products and local
wisdom. This research aims to analyze the sustainability study of local wisdom-based
SMEs in Denpasar City. This research uses an associative quantitative approach with
primary data from 144 respondents. Using the purposive sampling method and the
data analysis technique used in this research is SEM Partial Least Square. The research
results show that social capital, entrepreneurial orientation and local wisdom have a
positive and significant effect on business performance, while the role of government
does not have a significant effect on business performance. The role of government,
social capital, entrepreneurial orientation, and business performance have a positive
and significant effect on the sustainability of SMEs. Local wisdom moderates the
influence of social capital on SME business performance. Meanwhile, social capital and
entrepreneurial orientation have an indirect effect on sustainability through business
performance, while the role of government has no indirect effect on sustainability
through SME business performance.