The Influence of Entrepreneurial Competence and Innovation on the Business Sustainability of MSMEs in Kendari City
Keywords:
Business Sustainability, Entrepreneurial Competence, Innovation, MSMEsAbstract
Micro, Small, and Medium Enterprises (MSMEs) act as the driving force of regional economic growth through job creation and income generation. In Kendari City, approximately 41,939 active MSMEs were recorded in the Online Data System (ODS) in 2024, showing a post-pandemic growth trend. However, challenges in sustaining MSME performance remain, particularly due to limited entrepreneurial competence and weak innovation capabilities among business owners. This study analyzes the influence of entrepreneurial competence and innovation on MSME business sustainability in Kendari City. A quantitative approach was applied using a survey method, involving 100 MSME owners selected through purposive sampling. The research instrument employed a Likert-scale questionnaire with indicators measuring entrepreneurial competence, innovation, and business sustainability. Data were analyzed using multiple linear regression with SPSS. Results show that entrepreneurial competence and innovation simultaneously have a significant effect on business sustainability (F = 103.138; p < 0.001). Partially, entrepreneurial competence has a positive effect (t = 3.470; p = 0.001), while innovation is the strongest factor influencing business sustainability (t = 10.848; p < 0.001). These findings imply that MSMEs in Kendari City require managerial skills supported by innovation-based capabilities to remain competitive and maintain long-term operations. Strengthened innovation-oriented entrepreneurship programs and government digital support are recommended to enhance sustainability outcomes.
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