Competitive Strategy of Leather Industries in Manding Central Leather Industries, Bantul Residence

Abstract

Since 1979, Manding is the center of the leather industries which is wellknown by the people of Yogyakarta. Currently, Manding leather industries have decreased the competitiveness. This is characterized by the reduction number of export, the amount of production and the amount of annual sales. The purposes of this study were: (1) to formulate a strategy to raise the competitiveness. (2) to determine the priority strategies in enhancing the competitiveness of the leather industries in Manding. The tools used to analyze the data were the IFE matrix, EFE matrix that assisted by Porter’s Five Forces Model analysis, IE matrix, SWOT matrix, and QSPM matrix. The internal environment factors which influenced the company‟s strength consist of satisfied quality product; the big name of Manding; and the availability of raw materials. Meanwhile, the weaknesses of the industry were caused by the limitation of business network; low education of the workers; and problems of showroom. The external factor that increasing the opportunies in the industry was the impression of manding leather products are exotic, elegant and exclusive. From the quesioner we found that one of the popular product is stingray leather products In addition, the government also supported this by Ministry of Industry, ATK, and BBPPK. On the other hand, the external factors that threaten the industry were the existence of similar leather industries in vary scales; increase in fuel; and competition with substitute products. Prioritized strategies in enhancing the competitiveness of the leather industry Manding based on QSPM matrix in this study were: (1) an Internet-based marketing, the applications could be website making, join in the tradingforum, as well as the use of social media as a promotional tool and online transactions. (2) Provide the product knowledge and product trademarks. These mean for promotion, capture loyal customers, and expand the network marketing cooperation. (3) Optimize the function of the Manding craftsmen community. The craftsmen association namely Setyo Rukun expected to motivate and coordinate the craftsmen being active following the exhibition and to improve the ability to innovate products and administrative guidance for SMEs (Small and Medium Entities). As a results, these strategies are considered to cope the main issues in marketing and financial capital. Thus, by solving these expected to be able to improve the competitiveness in Manding leather industry center.