Strategy for Increasing Traditional Market Competitiveness in Dealing with the Presence of Modern Market

Abstract

Modern market growth in Indonesia showed significant figure compared to the growth of the traditional markets. The shrinking of the traditional market and modern market growth was also due to the rising living standards and changing lifestyles of people, as well as the desire for comfort, freedom, guarantee low price and good quality into consideration of the public. The purpose of this research was to analyze the impact of the modern market to traditional market traders. The analysis used in this research was a quantitative analysis with Difference-in-Difference (DiD) method, analysis using different test (t-test) with Wilcoxon, Buyer Perception Analysis, and Analytical Hierarchy Process (AHP). Based on the results of analysis using DID (Difference-in-Difference) by comparing market treatment and control markets, it was found that the impact of the presence of a modern market to traditional market traders evidenced by the decrease in the average turnover of the traditional market traders reaching (-7.8 %), the average profit (-9.39%), the number of buyers (-12.3%), and a decrease in the number of workers in traditional markets (-2.50%). Meanwhile, the results of the analytical hierarchy process (AHP) indicated that there were several aspects to improve the traditional market competitiveness according to priority measures to be carried out in the first place, namely the local government support (29.43%), facilities and infrastructure (23.96 %), the market management (20.60%), finance (15.02%) and merchandise inventory in the last rank (10.98%).

Keywords: Traditional Market Competitiveness, Local Government Support, Market Management, Finance, Traditional Market Traders.