Role of Characteristics and Competencies in the Business Performance of Functional Beverage SMEs

Authors
Nuning Setyowati 1
Kusnandar Kusnandar 2
Mohamad Harisudin 2
Erlyna Wida Riptanti 1
Isti Khomah 2
Rara Aulia Qonita 2
1 1. Department of Agribusiness, Faculty of Agriculture, Universitas Sebelas Maret, Indonesia. 2. Center for Study and Assistance for Cooperatives and Small-Medium Enterprises, Institute for Research and Community Service (LPPM), Universitas Sebelas Maret, Indonesia.
2 Department of Agribusiness, Faculty of Agriculture, Universitas Sebelas Maret, Indonesia.
10.48311/jast.2026.24117
Abstract
This study examines the effects of owner characteristics, product competence, and business capital on the business performance of Small and Medium Enterprises (SMEs) in the functional beverage sector. It also investigates the mediating role of owner competence in the relationship between owner characteristics and business performance. Employing a quantitative approach, data were collected via a structured questionnaire from 105 functional beverage SMEs in Solo Raya, Indonesia. Structural Equation Modeling with Partial Least Squares was used for analysis. The results indicate that business capital and product competence significantly and positively influence business performance. Owner characteristics do not have a direct effect on business performance, but influence it indirectly through full mediation by owner competence. The findings suggest that functional beverage entrepreneurs should enhance their self-competence encompassing knowledge, skills, and business experience, and strengthen business capital to improve performance. Additionally, developing entrepreneurial characteristics is crucial for boosting business outcomes through improved owner competence.


Keywords
Business capital
Owner characteristics
Owner competence
Product competence
Subjects
1.       Absah, Y., Chairunisa Muchtar, Y. and Qamariah, I. 2018. The Effect of Intellectual Capital on Business Performance in Micro-, Small-, and Medium Enterprise (MSME) in Medan City. KnE Soc. Sci., 3(10): 177–186.
2.       Alizar, S. N. and Mariyanti, E. 2024. Mengapa Kompetensi dan Karakteristik Wirausaha Penting ? J. Ekon. Manaj. Dan Bisnis (JEMBS), 3(2): 232–238.
3.       Augustinah, F., Chandra, E., Julyanthry, J., Putri, D. E. and Sudirman, A. 2022. Existence of SMEs Business Performance During the Covid-19 Pandemic: Analyzing the Contribution of Intellectual Capital and Technological Innovation. J. Organ. Dan Manaj., 18(2): 87–99.
4.       Barney, J. B., Ketchen, D. J. and Wright, M. 2021. Bold Voices and New Opportunities: An Expanded Research Agenda for the Resource-Based View. J. Manag., 47(7): 1677–1683.
5.       Cahyati, N. K. D. 2023. Do Owner Characteristic, Technology Usage, and Product Competence Affect Small Business Performance? J. Bus. Manag. Soc. Stud., 2(2): 96–105.
6.       Creswell, W. J. and Creswell, J. D. 2018. Research Design: Qualitative, Quantitative adn Mixed Methods Approaches. Fifth Edition, SAGE Publications, Inc., California, United Kingdom.
7.       Dewantoro, B., Putranto, A. and Purwanto, H. 2023. Pengaruh Kompetensi Sumber Daya Manusia, Dan Inovasi Produk Terhadap Kinerja UMKM (Studi Empiris Pada UMKM di Kabupaten Wonosobo). J. Econ. Manag. Bus., 2(1): 60–72.
8.       Dini, I. 2019. An Overview of Functional Beverages. In: "Functional and Medicinal Beverages- Volume 11: The Science of Beverages". 11th Edition, Elsevier Inc., Naples, Italy, PP. 1–40.
9.       Hair, J. F., Black, W. C., Babin, B. J., Anderson, R. E., Black, W. C. and Anderson, R. E. 2018. Multivariate Data Analysis. 8th Edition, Annabel Ainscow, United Kingdom.
10.    Hair, J. F., Risher, J. J., Sarstedt, M. and Ringle, C. M. 2019. When to Use and How to Report the Results of PLS-SEM. Eur. Bus. Rev., 31(1): 2–24.
11.    Harmayani, E., Anal, A. K., Wichienchot, S., Bhat, R., Gardjito, M., Santoso, U., Siripongvutikorn, S., Puripaatanavong. J. and Payyappallimana, U. 2019. Healthy Food Traditions of Asia: Exploratory Case Studies from Indonesia, Thailand, Malaysia, and Nepal. J. Ethn. Foods, 6(1): 1–18.
12.    Hidayah, A. R. N., Rahayu, E. S., Riptanti, E. W., Harisudin, M. and Khomah, I. 2024. Entrepreneurial characteristic effect on business performance of millennial farmers. Scientific Horizons, 27(7), 138–147. https://doi.org/10.48077/scihor7.2024.138
13.    Isma, A., & Aliasyahbana, A. N. Q. . (2022). Study of Entrepreneurial Capital and Economic Education Aspects in Entrepreneurial Decision Making Food Street Vendors at Losari Beach Area, Makassar City. Pinisi Business Administration Review, 4(1), 85–92. Retrieved from http://ojs.unm.ac.id/index.php/pbar/index
14.    Istinganah, N. F. and Widiyanto. 2020. Pengaruh Modal Usaha, Tingkat Pendidikan, dan Karakteristik Wirausaha Terhadap Perkembangan UKM. Econ. Educ. Anal. J., 9(2): 438–455.
15.    Joseph F. Hair, J., Hult, G. T. M., Ringle, C. M. and Sarstedt, M. 2022. A Primer on Partial Least Squares Structural Equation Modeling (PLS-SEM). In: "Women Entrepreneurs", (Eds.): Fargotstein, L., Offley, K., Tiwari, N. and Mahindra, G. Third Edition, SAGE, Los Angeles.
16.    Karimah, I. and Meliza. 2023. The Effect of Human Resource Competence , Entrepreneurship Characteristics , and Innovation on Small And Medium Enterprise Performance. The 1th International Conference on Social Sciences, Humanities and Arts (INCOSHA), 7 –8 Juni 2023, Pekalongan, 1: 81-88.
17.    Lachowicz, M. J., Preacher, K. J., & Kelley, K. 2018. A Novel Measure of Effect Size for Mediation Analysis. Psychol. Methods, 23(2): 244–261.
18.    López Rodríguez, J. and Serrano Orellana, B. 2020. Human Capital and Export Performance in the Spanish Manufacturing Firms. Balt. J. Manag., 15(1): 99–119.
19.    Man, T. W. Y., Lau, T. and Chan, K. F. 2002. The Competitiveness of Small and Medium Enterprises: A Conceptualization with Focus on Entrepreneurial Competencies. J. Bus. Ventur., 17(2): 123–142.
20.    Newman, A., Obschonka, M., Schwarz, S., Cohen, M. and Nielsen, I. 2019. Entrepreneurial Self-Efficacy: A Systematic Review of the Literature on Its Theoretical Foundations, Measurement, Antecedents, and Outcomes, and an Agenda for Future Research. J. Vocat. Behav., 110: 403–419.
21.    Obschonka, M. and Stuetzer, M. 2017. Integrating Psychological Approaches to Entrepreneurship: The Entrepreneurial Personality System (EPS). Small Bus. Econ., 49(1), 203–231.
22.    Ode, L., Fitrah, M., Madjid, R., Zaid, S. and Yusuf, H. 2024. The Effect of Entrepreneurship Training on Entrepreneurial Orientation , Product Innovation , Competitive Advantage , and Business Performance in the Processed Food Industry in Kendari , South East Sulawesi. J. Glob. Innov. Agric. Sci., 12: 1–5.
23.    Ogbeibu, S., Jabbour, C. J. C., Gaskin, J., Senadjki, A. and Hughes, M. 2021. Leveraging STARA Competencies and Green Creativity to Boost Green Organisational Innovative Evidence: A Praxis for Sustainable Development. Bus. Strateg. Environ., 30(5): 2421–2440.
24.    Othman, N. H., Attaullah, S. A. B. and Pazil, A. H. M. 2016. Influence of Work Experience and Education towards Business Performance among Entrepreneurs. Int. Bus.Educ. J. 9(1): 78–87.
25.    Ozdemir, S., Carlos Fernandez de Arroyabe, J., Sena, V. and Gupta, S. 2023. Stakeholder Diversity and Collaborative Innovation: Integrating the Resource-Based View with Stakeholder Theory. J. Bus. Res., 164: 113955.
26.    Pamela, V., Kusumasari, S. and Meindrawan, B. 2021. Development of Functional Beverages from Herbs: Aspect of Nutrition, Processing and Safety. IOP Conf. Ser. Earth Environ. Sci., 715: 1–7.
27.    Parida, V., Pesämaa, O., Wincent, J. and Westerberg, M. 2017. Network Capability, Innovativeness, and Performance: A Multidimensional Extension for Entrepreneurship. Entrep. Reg. Dev., 29(1–2): 94–115.
28.    Pusung, C. S., Narsa, N. P. D. R. H. and Wardhaningrum, O. A. 2023. Innovation, Competitive Strategy and Msme Performance: a Survey Study on Culinary Smes in Indonesia During the Covid-19 Pandemic. Bus.: Theory Pract., 24(1): 160–172.
29.    Renaldo, N., Sudarno, S., Hutahuruk, M. B., Junaedi, A. T., Andi, A. and Suhardjo, S. (2021). the Effect of Entrepreneurship Characteristics, Business Capital, and Technological Sophistication on Msme Performance. J. Appl. Bus. Technol., 2(2): 109–117.
30.    Riptanti, E. W., Harisudin, M., Kusnandar, Khomah, I., Setyowati, N. and Qonita, R. A. 2022. Networking Capabilities of Millennial Farmers in Central Java. IOP Conf. Ser.: Earth Environ. Sci., 1114(1): 1–8.
31.    Roselidyawaty, N. and Rokeman, M. 2024. Likert Measurement Scale in Education and Social Sciences: Explored and Explained. EDUCATUM J. Soc. Sci., 10(10): 77–88. https://doi.org/10.37134/ejoss.vol10.1.7.2024
32.    Rumangkit, S. and Prabowo, H. 2025. Global Trends and Future Research Resources-Based View Theory in Management Science through a Scoping Review and Bibliometric Analysis. Multidiscip. Rev., 8(1): 1–8.
33.    Samilyk, M., Bolgova, N., Samokhina, E., Cherniavska, T. and Kharchenko, S. 2024. Use of Hop Extract in the Biotechnology of Kefir Beverage. Sci. Horiz. 27(3): 97–106.
34.    Sarwoko, E., Surachman, Armanu and Hadiwidjojo, D. 2013. Entrepreneurial Characteristics and Competency as Determinants of Business Performance in SMEs. IOSR J. Bus. Manag., 7(3): 31–38.
35.    Setyowati, N., Masyhuri, Mulyo, J. H., Irham, and Yudhistira, B. 2023a. The Hidden Treasure of Wedang Uwuh, an Ethnic Traditional Drink from Java, Indonesia: Its Benefits and Innovations. Int. J. Gastron. Food Sci., 31: 100688.
36.    Sudiarti, N. W. and Juliarsa, G. 2020. Pengaruh Kompetensi Sumber Daya Manusia dan Locus of Control terhadap Kualitas Laporan Keuangan LPD. E-Jurnal Akuntansi, 30(7): 1725–1737.
37.    Suindari, N. M. and Juniariani, N. M. R. 2020. Pengelolaan Keuangan, Kompetensi Sumber Daya Manusia Dan Strategi Pemasaran Dalam Mengukur Kinerja Usaha Mikro Kecil Menengah (Umkm). KRISNA: Kumpulan Riset Akuntansi, 11(2): 148–154.
38.    Surya, B., Menne, F., Sabhan, H., Suriani, S., Abubakar, H. and Idris, M. 2021. Economic Growth, Increasing Productivity of SMEs, and Open Innovation. J. Open Innov. Technol. Mark., Complex., 7(1): 1–37.
39.    Syam, A., Amir, N. A., Dewantara, H. and Jufri, M. 2023. The Influence of Motivation, Business Capital and Marketing Strategy on MSMEs Development during the Covid-19 Pandemic in Takalar Regency. Indones. J. Bus. Entrep. Res., 1(1): 24–32.
40.    Unger, J. M., Rauch, A., Frese, M. and Rosenbusch, N. 2011. Human Capital and Entrepreneurial Success: A Meta-Analytical Review. J. Bus.Ventur., 26(3): 341–358.
41.    Wahyuningsih, Safitri, Y., Rosidah and Agustina, T. 2022. Production of Bay Leaf Instant Powder Drink Using Different Amounts of Rock Sugar to the Level of Preference and Nutrient Content (Carbohydrates and Flavonoids). IOP Conf. Series: Earth Environ. Sci., 969: 1-6.
42.    Widyaningsih, T. D., Siska, A. I., Fanani, R. and Martati, E. 2020. Traditional Drink of Black Cincau (Mesona palustris BL)-Based Wedang Uwuh as Immunomodulator on Alloxan-Induced Diabetic Rats. Nutr. Food Sci., 50(6): 1123–1133.
43.    Yusuf Alkandahri, M., Zahra Shafirany, M., Rusdin, A., Setianingsih Agustina, L., Pangaribuan, F., Fitrianti, F. and Hari Kusumawati, A. 2021. Amomum Compactum: A Review of Pharmacological Studies. Plant Cell Biotechnol. Mol. Biol., 22(34): 61–69.
44.    Zainol, N. R., Al Mamun, A., Ahmad, G. and Simpong, D. B. (2018). Human Capital and Entrepreneurial Competencies towards Performance of Informal Microenterprises in Kelantan, Malaysia. Econ. Sociol.11(4): 31–50.
45.    Yani, A. A., Ahmad, B. and Rakhmat. 2020. Analysis of Innovation Capabilities of Regional Governments in Accelerating Agricultural Development in Bantaeng Regency, Indonesia. Int. J. Manag., 11(12): 1978–1989.
46.    Isma, A. and Aliasyahbana, A. N. Q. 2022. Study of Entrepreneurial Capital and Economic Education Aspects in Entrepreneurial Decision Making Food Street Vendors at Losari Beach Area, Makassar City. Pinisi Bus. Admin. Rev., 4(1): 85–495.
47.    Istinganah, N. F. and Widiyanto. 2020. Pengaruh Modal Usaha, Tingkat Pendidikan, dan Karakteristik Wirausaha Terhadap Perkembangan UKM. Econ. Educ. Anal. J., 9(2): 438–455.
48.    Syam, A., Amir, N. A., Dewantara, H. and Jufri, M. 2023. The Influence of Motivation, Business Capital and Marketing Strategy on MSMEs Development during the Covid-19 Pandemic in Takalar Regency. Indones. J. Bus. Entrep. Res., 1(1): 24–32.
49.    Ghozali, I. 2014. Structural Equation Modeling Metode Alternatif Dengan Partial Least Square (PLS). Edisi 4, Universitas Diponegoro, Badan Penerbit, Semarang.
 
 
 
 
Journal of Agricultural Science and Technology
Volume 28, Issue 5
September and October 2026
Pages 1097-1112