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ABSTRACT
Clusters are groups of activities consisting of core industries, related industries, supporting industries, and supporting and related economic activities, which are interrelated and mutually supportive. This study aims to cluster micro, small and medium enterprises (MSMEs) in Garut Regency based on their similarity of attributes attached to the factors. These aspects include a taxpayer identification ownership, business license ownership, total net worth, total capital, number of employees, total business volume, product certification, product license, and brand. Clusterization has an important urgency for the development of MSMEs. Clustering can help group MSMEs into groups that are easier to analyze and make the right decisions to increase the efficiency and competitiveness of MSMEs. In addition, the application of clustering for MSMEs can have positive implications such as identifying the characteristics of MSMEs, developing appropriate marketing strategies, improving product or service quality, collaboration and information exchange, and access to resources. This can help MSMEs to increase their efficiency and competitiveness in the market. After data screening, the sample of MSMEs was analyzed using K-means clustering analysis and the help of RapidMiner 5.3 software. There were six iterations conducted before the data position value was stable, with the results revealing three MSME clusters. Cluster 2 had the highest percentage of MSMEs, with 84%. Cluster 1 had a higher percentage of MSMEs with ownership of business license numbers than Clusters 2 and 3. Cluster 3 had a larger and more significant number of MSMEs and a larger total net worth and ownership of product and brand licenses than the other clusters, while Cluster 2 showed an intermediate profile in almost all factors. The study results provide an overview of the local government in adopting cluster formation policies in Garut Regency.
Keywords: Clusterization, K-Means Clustering, MSME.
1.INTRODUCTION
Micro, small, and medium enterprises (MSMEs) play an important role in absorbing more than 97% of the workforce in Indonesia, which impacts 57% of the gross domestic product (GDP) (Indonesia Central Bureau of Statistics, 2021). The existence of MSMEs in the structure of the Indonesian economy occupies a very important position. Therefore, efforts are needed to develop it more comprehensively. One of the efforts to develop and empower MSMEs is the cluster system approach.
MSME clustering is considered one of the strategies...