The Effect of Market Orientation, Innovation, and Entrepreneurial Orientation to the Competitive Advantage of the Independent Coffee Shops in Indonesia

This study investigates the effects of market orientation, innovation and entrepreneurial orientation for the competitive advantage of independent coffee shops across Indonesia. Qualitative and quantitative approaches were adopted for the study, specifically utilizing the format of a questionnaire and in-depth interviews for data collection. The sample used were 200 business owners/CEOs/managers of various coffee shops in Indonesia who have run the business for two years or more. The researcher interviewed respondents who are three business owners/ managers who have a coffee shop that is unique from their competitors. Data analysis of quantitative data used descriptive statistics and multiple regression analysis, while qualitative data used deductive analysis. The results of the study indicated the positive and significant effect of market orientation, innovation, and entrepreneurial orientation toward the competitive advantage of Indonesian coffee shops. In order of influence, the factors that benefited said competitive advantage were entrepreneurial orientation, innovation, and market orientation. To gain such a competitive advantage, the coffee shop owners/managers must be proactive in regularly evaluating the coffee shop's market position and revenue compared to the competitors and organizing events/ social programs. To be distinct from the competitors, the coffee shops must have signature food or drinks or give a unique name/presentation of the product, or have more variety of menu options, e.g., vegan, healthy, caffeine-free, and dairy-free alternatives. To meet the customer’s wants and needs, the coffee shop has to provide high-quality coffee products, offer a variety of flavor options, and create a comfortable place.