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Indonesian online MSMEs tally significant recovery in Q1 2021, index shows

Jakarta, Indonesia – Bank Rakyat Indonesia (BRI) has recently launched its BRI Micro & SME Index (BMSI) Q1 2021 and has found that a greater majority of Indonesia medium and small enterprises (MSMEs) have recorded significant recovery this year, following a current trend of digital marketing in the country.

BRI noted that online MSMEs sectors grew by 34.1%, while only 26.5% of offline MSMEs improved their business compared to the figures in Q4 2020. The survey of BMSI also found that offline MSMEs have been hard-hit in the last three months, amounting to a decrease of more than 3.9% higher than online businesses at 40.7%. 

According to Aestika Oryza Gunarto, corporate secretary at BRI, digital marketing has played a vital role in development of online MSMEs sectors, followed by a significant economic growth despite the COVID-19 pandemic. Furthermore, the digital sales strategy has encouraged MSMEs players to add more value to their products and services than entrepreneurs with direct (offline) marketing strategy.

“In general, the online sales activity of MSME players is higher than those that are offline. As a result, most business sectors such as agriculture, processing and mining industries, have reached optimistic index results or above the threshold figure of 100,” said Gunarto.

Manufacturing and agriculture are two main sectors that experience the highest growth with regard to online MSMEs, amounting to over 100 thresholds in the Q1 2021. Process manufacturing takes place at 101.8 in the index for online MSMEs, while the agricultural sector is at the level of 101.2.

The index figure brought along increasing optimism for MSME players to grow bigger in Q2 2021, with the Business Activity Expectations Index (IEAB) on the BMSI rising from 105.4 to 128.0. MSME players reflect frankly on the improving business performances of the overall macroeconomic condition, amounting to an increase of Business Sentiment Index (BSI) from 90.2 in Q4 2020 to 115.5 in Q1 2021.  

Gunarto added, “MSMEs players applying online marketing strategy are realising more optimistic results, at least in the next three months. Digitalization has provided excellent performances of the overall economic growth and sales increases, mostly driven by online marketing strategy.”