Market Assessment

ILO Indonesia 2000

    The study included two parts: an SE survey and a provider survey. The quantitative SE survey gathered information from 401 micro and small enterprises with less than 20 workers in Semarang and surrounding areas in Central Java, Indonesia. The survey used a modified Usage, Attitude, Image Market Study format to investigate SEs' awareness, understanding, usage and opinions about a wide range of business services. The aim of the SE survey was to get a basic understanding of the demand for business services from SEs, a picture of supply from the consumer perspective and some indications about opportunities for BDS market expansion. The provider survey gathered information from approximately 50 private sector providers of services such as training, information, telecommunications and internet access. It also looked particularly at media focused on the small business market. The cost for the SE survey was US$9,935; the cost for the provider survey was approximately US$2,000; the cost for international consultants was approximately $3,500.

    Methods for info gathering
    SE Survey, UAI Survey, Provider Interviews, Provider Survey, Key Informant Interviews, Quantitative, Qualitative

    Summary of results
    The study revealed small but diverse BDS markets with potential for expansion. Respondents' awareness about services was reasonably high. Market penetration was 66% for call centers and 25% for courier. Advertising, information from the media and technical training had all been used by over 5% of respondents. Most other services showed some level of use. The provider survey indicated that private providers offered a range of training services at reasonable prices and that some telecommunications, Internet and media companies did target the small enterprise market with particular service products or marketing.

    Interestingly, the study showed few perceptible differences between women and men entrepreneurs in their service use or attitudes. While urban service markets were generally stronger than their rural counterparts, there were exceptions, particularly for communications centers and courier services. The microenterprises appeared to use services to a similar degree as the small enterprises in the study. The study concluded that the service markets with the most potential for expansion among micro and small enterprises were advertising or, more broadly, marketing, technical training and information. The study includes an analysis of the weaknesses and opportunities in the most promising BDS markets as well as broad ideas for program interventions.

    The study was used to inform the design of a program in Central Java to develop information flows about BDS, through a commercial B2B newspaper and a web portal. The newspaper included a weekly insert with directories of local, commercial service providers, and a full listing was placed on a web portal. Over time, however, the newspaper changed its business plan, and other agencies came in with similar, but larger interventions. At the time of writing, therefore, the ILO is not active in this area.

    Associated Activities and Documents
    Market Assessment
    »Observations on formal BDS markets in Asia, by Dorothy Riddle, 2000