Entrepreneurship contributes to successful businesses, and maintaining good performance requires managing skills. Data shows varying levels of entrepreneurship across Indonesian provinces. Small businesses are unique due to their planning and structure. MSMEs make up the majority of Indonesian businesses and economic activity, though they face challenges exacerbated by COVID-19, including decreased demand, supply issues, and difficulties distributing products. The government has implemented programs to support MSMEs during this difficult time.

1. ENTREPRENEURSHIP
ANDBUSINESS
DARREL

2. WOODGROVE
BANK
ENTREPRENEURSHIP
2
Entrepreneurship is a part of business life contributes
towards successful business organization. The people
who are actively deal with business activities are
most responsible for the achievement of their vision.
To maintain good performance of entrepreneurship,
it is necessary to manage the entrepreneurship, and
explore the skills required.

3. WOODGROVE
BANK
ENTREPRENEURIALGROWTHININDONESIA
3
Province Micro Small Medium & Large
North Sumatra 42 81 17
Riau 21 26 2
Jakarta 21 34 25
West Java 78 51 53
Central Java 41 40 23
Yogyakarta 8 52 31
East Java 34 70 87
Banten 21 11 14
Bali 6 14 4
West Nusa Tenggara 20 42 19
West Kalimantan 20 14 2
South Sulawesi 25 10 8
Central Sulawesi 12 18 2
Gorontalo 16 26 8
Papua 3 17 11
Total 368 506 306

4. WOODGROVE
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BUSINESS
4

5. WOODGROVE
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SMALL BUSINESS
5
Small entrepreneurial organizations give to entrepreneurs’
personality a unique style in terms of planning and
controlling activities, organizational structure etc. on market
approaches. Thus it is considered widely accepted that not
material and financial availability empower SMEs, but the
presence of the entrepreneur.
The presence of Indonesian businesses provides
opportunities for economic growth and employment
opportunities. The largest economic contributor is micro-
enterprises, followed by small and medium-sized enterprises.

6. WOODGROVE
BANK
ENTREPRENEURIAL
VENTURES
6

7. WOODGROVE
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Identifying these types of ventures posed the greatest difficulty. Ventures were
sought where the purpose of the business activity was to generate subsistence
income for the entrepreneur, the entrepreneurial activity was the individual’s
primary source of income, the venture had no permanent premises and few if any
assets, the entrepreneur had no business bank account, the business was a sole
proprietorship or unregistered, and the business centered on the labors of the
entrepreneur.
SURVIVAL VENTURE

8. WOODGROVE
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LIFESTYLE VENTURES
8
Provide a relatively stable income stream for owners based on a workable business model and
a maintenance approach to management. Relatively modest reinvestments are made to
maintain competitiveness in a local market where the firm is embedded. The venture typically
has premises, usually a single location, and employees, but does not seek meaningful
expansion or growth. Numbers of employees remain relatively constant. Given limited
capacity, it is difficult for the venture to achieve economies in operations.

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BANK 9
MANAGED GROWTH VENTURE
Selection criteria included an ongoing quest for steady growth through establishment of
new locations, periodic introduction of new products and services, entry into new
markets, and development of a regional brand.

10. WOODGROVE
BANK 10
AGGRESSIVE GROWTH VENTURES
Firms were selected based on a record of high rates of revenue growth for a three year
period, high growth as an ongoing goal, efforts to compete on a national or international
basis, a strategic emphasis on new products and services and/or innovative business
models as a source of competitive advantage, and a reliance on equity investors for
growth capital.

11. WOODGROVE
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BUSINESS SIZE
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12. WOODGROVE
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COMPARISON
Micro -Enterprises
• Operate in the informal sector, are
unregistered and do not pay taxes
• Majority of business locations in rural,
owner-controlled, informal financial
accounting systems.
• Only reach local markets
• Enterprises which have maximum net
assets of IDR 50 million, not including the
land and buildings used by the business; or
• Enterprises which have maximum annual
revenues of IDR 300 million
Small Businesses
• Operate in the formal sector, are registered
and pay taxes.
• This business is located in an urban area
• managed by the owner, reaches the national
market, and has an upper-middle income
• Enterprises which have net assets of more
than IDR 50 million but less than IDR 500
million, not including the land and
buildings used by the business; or
• Enterprises which have annual revenues of
more than IDR 300 million but less than
IDR 2.5 billion.
12
Medium Business
• Operate in the formal sector, and pay taxes.
• Business location In urban areas
• Managed by professional management, has
many employees, and a formal bookkeeping
system
• Medium-sized enterprises also have the
technology in producing and selling on a
national and international scale.
• Enterprises which have net assets of more
than IDR 500 million but less than IDR 10
billion, not including the land and buildings
used by the business; or
• Enterprises which have annual revenues of
more than IDR 2.5 billion but less than IDR
50 billion.

13. WOODGROVE
BANK
GENERALSITUATIONAND
BUSINESSDEVELOPMENT
DURINGCOVID-19
13
The corona pandemic has severely restricted public life in
Indonesia. Schools and universities are closed, and those who
not laid off are forced to work from home. Many shopping
malls, shops and restaurants have temporarily closed. Road
traffic runs smoothly for the first time in Jakarta. The brand new
metro is almost empty. In front of all large public and private
buildings, visitors have to undergo infrared fever measurement.
In some places, they are sprayed with disinfectants. Everywhere
floor markings urge you to keep your distance.

14. WOODGROVE
BANK
GENERALSITUATIONAND
BUSINESSDEVELOPMENT
DURINGCOVID-19
14
Before the pandemic, the Treasury had expected real economic growth of 5.3 percent. In mid-March,
the Indonesian central bank then lowered the forecast to a corridor between 4.2 and 4.6 percent. In the
meantime, a new scenario from the Ministry of Finance assumes only 2.3 percent. In the worst case,
economic output could even decline to 0.4 percent. This would be the lowest growth in more than 20
years. Since the Asian crisis of 1998, Indonesia's economy has been growing continuously - on
average by more than 5 percent.
The tourism sector is suffering the most. The manufacturing industry is also affected because it is
highly dependent on imported primary products, especially from China. At the same time, the Middle
Kingdom is reducing its Indonesian exports by thirty percent beyond the oil and gas sector. As a rule
of thumb, for every percentage point of lower economic growth in China, Indonesian economic
growth falls by 0.3 to 0.6 percentage points.
Indonesia's economy is badly hit by the corona pandemic. The restrictions on public life put pressure
on demand. Given the uncertainty of how long the economy will be affected by the effects of the
virus, it is too early to accurately predict economic growth for 2020.

15. WOODGROVE
BANK
GENERALSITUATIONAND
BUSINESSDEVELOPMENT
DURINGCOVID-19
15
With the advent of the corona pandemic, many investors have withdrawn funds from Indonesia,
resulting in a dramatic drop in the currency's exchange rate. On April 2, 2020, the US dollar was
trading at Rp 16,741 per. This corresponded to a loss in value of almost 20%within just six weeks and
scratched at the historical low of Rp 16,950 rupiah per 1 USD. The previous negative record comes
from the turmoil of the Asian crisis in 1998.
The Indonesian central bank has so far spent large sums to support the rupiah. After all, the country
has currency reserves of $130 billion. Indonesian government finances are considered solid, but
potential government debt is largely outsourced to state corporations that control large parts of the
economy.
The central bank also lowered the key interest rate (seven-day reverse repo rate) by 0.25 percentage
points to 4.5% in order to provide the markets with more liquidity. The last cut - also by 0.25
percentage points - had only occurred eight weeks earlier. The key interest rate was 6% a year ago.

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IMPACTBUSINESSDURING
COVID-19
More than 45% of MSMEs surveyed noted that they had problems obtaining raw
materials.
Nine out of ten MSMEs faced lower demand for their products during the
pandemic.
Most of the MSMEs found it difficult to distribute their products due to COVID-19.
Around 44% of the MSMEs surveyed had joined the online marketplace or e-
commerce channels (Tokopedia, Shopee, etc.) during the COVID-19 pandemic.
One of the alternative strategies adopted by MSMEs to minimize their expenses is
reducing consumption of utilities, thus lowering their bills.
More than 40% of MSMEs had been selling their products through the online
marketplace

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COVID–19ANDONLINE
MARKETPLACE
During the COVID-19 pandemic, there have been many success stories among MSMEs that took their
businesses online or engaged in e-commerce channels. Most of the MSMEs surveyed had not joined the
online marketplace before the pandemic.
0%
5%
10%
15%
20%
25%
30%
35%
Micro Small Medium and
Large
Total
Before Covid - 19
Micro Small Medium and Large Total
0%
10%
20%
30%
40%
50%
60%
70%
Micro Small Medium and
Large
Total
During Covid - 19
Micro Small Medium and Large Total

18. WOODGROVE
BANK
MICRO AND SMALL BUSINESS DEVELOPMENT
18
MSMEs are the most important pillars in the Indonesian economy. Based on data from the Ministry of
Cooperatives and SMEs, the number of MSMEs currently reaches 64.2 million with a contribution to
GDP of 61.07% or worth 8,573.89 trillion rupiah. The contribution of MSMEs to the Indonesian
economy includes the ability to absorb 97% of the total workforce and can collect up to 60.4% of the
total investment. However, the number of MSMEs in Indonesia is also inseparable from the existing
challenges.
To answer this challenge, the Government has implemented a number of MSME support programs,
including incentive and financing assistance through the PEN program, People's Business Credit,
Proudly Made in Indonesia National Movement (Gernas BBI), MSME marketing digitalization, Alumni
Program for Strengthening Pre-Employment Card Entrepreneurs through KUR Financing, and includes
long-term raising the MSME class through the Job Creation Law.
Another impact of this pandemic is to encourage a shift in consumption patterns of goods and services
from offline to online, with an increase in internet traffic of around 15-20%. This is a momentum to
accelerate digital transformation. The potential of Indonesia's digital economy is also still wide open
with the 4th largest population in the world and internet penetration that has reached 196.7 million
people.

19. WOODGROVE
BANK
IMPORTANT SMALL BUSINESS
19
The Government of Indonesia (GoI) has clearly defined objectives to gradually increase financing for
small and medium enterprises (SMEs), which are considered as the backbone of the economy. Around
99% of businesses in Indonesia are categorized as micro, small, and medium enterprises (MSME).
Around 700,000 from a total of over 57 million are small and medium sized enterprises
.
These enterprises provide jobs to over 93% of the labor force engaged in wage employment. However,
in terms of value added, micro and small enterprise contribute relatively less (43%) to gross domestic
product (GDP) compared to medium and large businesses (57%)

20. WOODGROVE
BANK
IMPLICATION OF SMALL BUSINESS IN DEVELOPED COUNTRIES AS OPPOSED
TO THE DEVELOPING COUNTRIES
SMALLBUSINESS INDEVELOPED
• Small businesses in developed countries are oriented
towards independence, expertise, and a large contribution to
GNP rather than GDP.
• Small businesses get special attention from developed
country governments
• Broad market orientation covering domestic and
international
• Encouraging the economic development of a country
• Easy access to capital for small businesses to get loans from
banks
20
• Small businesses for developing countries make a high
contribution to GDP.
• The majority of GDP contributors are micro and small
businesses.
• Assist government policies in reducing poverty or
unemployment
• The dependence of small and medium enterprises on the
government is very high
• Limited access to capital for small businesses in developing
countries
SMALLBUSINESS INDEVELOPING

21. THANK YOU
April Hansson +1 23 987 6554
april@woodgrovebank.com
www.woodgrovebank.com
WOODGROVE
BANK