EXAMINING THE INFLUENCE FACTORS OF NEW BUSINESS-TO-BUSINESS RELATIONSHIP: A STUDY OF WEST JAVA COOPERATIVES

• Main Author: Setiawan, Jessica
• Format: Theses
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/34918
• Institution: Institut Teknologi Bandung

Background of the problem: Indonesia is a rich country in natural resource potential and has great demand potential. However, this potential cannot be maximized by Indonesia itself. In fact, the Indonesian market is flooded with foreign products; it is indeed inseparable from global competition that requires Indonesia to assign trade agreement with other countries. Consequently, the trade balance becomes unbalanced, where the import value is greater than exports. This shows that Indonesia's ability to compete with other countries is still limited. Furthermore, global competition also affects the retail business competition map through online marketplaces or e-commerce such as Alibaba, Bukalapak, Lazada, and Tokopedia. The development of e-commerce certainly affects both large-scale businessmen such as Debenhams, Lotus, Matahari, and 7-Eleven who have to close a number of their outlets; some even go bankrupt, let alone small-scale businesses such as SMEs and cooperatives. Therefore, Indonesia's dependence on imported products must be minimized, through improving the quality of local produce, but further, it must also prepare a business entity to accommodate these products, especially SME products that are still less competitive compare to foreign products. Until now, there is no business network that can connect all actors, both from producers to consumers and of course can strengthen the marketing channel for SME products. Objective: The purpose of this study is to develop an integrated business network that focuses on the cooperative sector, especially in West Java and knows what factors influence a cooperative to collaborate on a business basis and how the characteristics of each type of cooperative field are. Cooperatives are unique business entities and are one of the pillars of the Indonesian economy that are in accordance with the characteristics of the Indonesian people, which are kinship and mutual cooperation. Unlike other business entities, cooperatives prioritize shared prosperity, so that it fits the conditions in Indonesia. Novelty: the novelty of this research besides using Indonesia, especially West Java as a research site and cooperatives as the object of research, this study mapped 56 research articles. In addition, this study also combines three theories in business-to-business relationship (Relational Exchange Theory, Social Exchange Theory, and Transaction Cost Economics). Research Methodology: this study uses a mixed method, which uses qualitative and quantitative methods. First, this study uses qualitative methods through in-depth interviews with practitioners in their fields. Then, the results of the interview are used to validate the measurements obtained from previous studies and also to map the characteristics of each type of cooperative. Second, validated measurements are used to obtain quantitative data through survey questionnaires. Third, the data obtained quantitatively is processed using Partial Least Square (PLS) through SmartPLS software. Results: Qualitative results are used to map three different types of cooperative fields (Indonesian civil servant cooperatives, women's cooperatives, and sharia cooperatives). The quantitative results show that the most influential and significant factors are competence-based trust and dysfunctional conflict while other factors were not significant, including trust based on goodwill-based trust, reward power, coercive power, formal contract, cooperation, and functional conflict. In addition, reward power and coercive power factors are factors that precede goodwill-based trust. Goodwill-based trust also affects formal contracts. Then, goodwill-based trust and competence-based trust together influence factor cooperation. Shortcomings and recommendations for future research: First, because the structural model is still under development, the results of this study are not satisfactory. Therefore, further research is needed to enrich the model and can include other factors. Second, this study combines all types of cooperative fields; women's cooperatives, sharia cooperatives, and Indonesian civil servant cooperatives that might influence results. Therefore, for further investigation, the objects of this study must further be divided into several groups based on type, income, store area, and their capacity to obtain results that are more representative and describe the conditions of each type of cooperative. Third, this study does not include emotional value factors that might affect results. For this reason, further studies can include emotional value, because based on the results of interviews; there are several cooperatives that discuss emotional value in choosing their business partners. Fourth, although the small sample size meets the minimum criteria, the bigger the size the better to get better results. Finally, this study only discusses factors in the buyer's perspective, so that to get a better understanding and perspective, it is recommended to measure the seller's perspective in the future.