The The Effects of Economic and Social Factors on the Financial Performance of MSMEs in Kampung Wisata Batik
Abstract
Micro, Small, and Medium Enterprises (MSMEs) play a vital role in economic growth and development. However, achieving sustainable financial performance remains a challenge, particularly for medium scale enterprises characterized by varying levels of capital and sales turnover. This study employed a quantitative approach to examine the partial and simultaneous effects of economic and social factors on the financial performance of MSMEs in the Kampung Wisata Batik. The study involved 100 MSME owners, all of whom were included as research respondents. Data were collected using a validated questionnaire measuring economic factors, social factors, and financial performance, and were analyzed using descriptive and inferential
statistics. The findings indicate that economic factors positively and significantly influence MSME financial performance. Likewise, social factors exert a positive and significant effect on financial performance. Furthermore, economic and social factors jointly contribute to improved financial performance. These findings highlight the importance of strengthening access to finance and enhancing managerial experience to support sustainable business performance. Overall, the integration of favorable economic and social conditions is essential for achieving stable and profitable financial outcomes among
MSMEs.
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