The Impact of Buying Power in Indonesia's Startups upon
Pandemics
Dessy Setiyawati
Universitas Negeri Malang
Abstrack : The Covid-19 pandemic has greatly cost many countries an economic loss. It is
difficult for us to carry out the activities of working outside the home. With a virus that is so
deadly and coupled with the difficulty of people keeping things clean, it is even easier to catch
the virus. Corona virus was first discovered in province Wuhan, China. Of course we already
know that with this virus, economic activity has become paralyzed and so many companies
have had to terminate work contracts, or have even gone out of business. No one can be held
this incident. The government itself is certainly busy to focus more on health services. It is a
pity indeed, but only we know which path to take. If we want to keep going, then we must try to
maximize the company's activities so that we can still have income. And as we will discuss,
startups in Indonesia are starting to strive to maximize their performance.Even though the risks
they face are very heavy.
Key Word : Pandemic, Inonesia’s startups, buying power
Preliminary
The corona virus or COVID-19 is a problem that has emerged from the end of 2019.
This virus was originally reported to have come from the Wuhan area, China. And this virus
spreads very fast. Several countries that have territories close to China have been affected by
the virus first. Followed by several other countries. This virus could not be contained, until it
finally entered Indonesia in early March 2020.
After the corona virus entered Indonesia in March, there was a lot of chaos. Apart
from the health sector, the economic sector has also experienced severe chaos, even
experiencing destruction. This virus is very deadly, regardless of age or gender. So that
anyone can be infected by this virus. The easy spread of this virus has infected almost all
parts of Indonesia. Both city and village. The government has also ordered the
implementation of PSBB (Large-Scale Social Restrictions). Where it is hoped that this PSBB
can break the chain of spreading the virus. However, this PSBB several times only served to
ease it.
The implementation of the PSBB in Indonesia is aimed at breaking the chain of the
spread of the corona virus or COVID-19. From this PSBB, of course, there are many
regulations that have been implemented by the government, such as working at home. Indeed,
this is the best choice. However, because of this, of course there will be an impact. With this,
the impact that can be felt is of course employment layoffs, we know that Indonesia is an
industrial country which is ranked in the top 10 in the world, according to the Ministry of
Industry of the Republic of Indonesia.
Indonesia is also the most populous country in the world and is ranked 4th after the
United States, according to the World Bank. Of course, the large population of Indonesian
people must be balanced with the adequacy of available jobs. And the existence of many
industries in Indonesia can reduce the unemployment rate. However, it turns out that during a
pandemic like this and with the PSBB regulations it will be difficult for workers. So that
many factory workers are affected by the impact, such as termination of contracts and of
course not working for months. Of course this will make the situation even more difficult.
This is also the case in several countries. Not a few countries have experienced an economic
crisis.
Indonesia's economic growth experienced Q-t-q experience with a value of 2.41% in
the first quartile, minus 4.19% in the second quartile. Of course this is very bad for Indonesia.
The difficulty of reactivating the work process in the field. Because we know that the corona
virus is very contagious. Economic growth that has touched a minus number is not only
Indonesia, there are several countries that have become Indonesian trading partners who have
also experienced the same thing.
The people's purchasing power has become weaker, because by not working, they
certainly do not get income. So that in the end they don't have money. Thus they will find it
difficult to carry out shopping activities to fulfill their needs. The government has also
provided some assistance. However, what the community got was not enough to fulfill their
needs for the next 3-4 years. The layoffs that occur certainly make a lot of people down and it
will be difficult to find a job again. Many operators have stopped the production process to
avoid this virus.
And fortunately there are still existing Stratups in Indonesia that can help increase the
economy and people's purchasing power. There are quite a lot of startup companies in
Indonesia. And in the process of working this startup company can be done at home. During
the pandemic, they are motivated to be able to generate enthusiasm for the community to be
able to do household shopping. Of course there will be many ways to be able to make people
interested in household shopping.
This startup company also uses sophisticated technology, so that people can shop
without the need to come to the store, but only by using applications. Apart from being very
effective, of course this is also more efficient and of course more affordable. The startup
certainly has guaranteed the safety of the buyers' goods so that buyers don't have to worry
about losing the wrong goods or items sent. The company has been trying to prepare in such a
way to survive this pandemic. So that it can help in generating state revenue.
The government has also tried its best to deal with this problem, a lot of assistance has
been provided ranging from direct aid funds to basic necessities. Countries that are trading
partners of Indonesia, Japan, for example, also provide assistance that is almost the same as
Indonesia. But still, it is difficult for these two countries to maintain economic growth so as
not to become a minus. The difficulty of people who are unable to go out and shop directly
makes more and more shops fall.
And fortunately, Indonesia still has several startups that can still carry out their
operational activities. Of course, this advantage can be utilized by Indonesia as much as
possible, in order to achieve better economic growth targets. The government must be able to
make itself the most important role in this problem. With the full confidence that the
government has in dealing with this pandemic, it is hoped that Indonesian startups with all
their efforts can continue to operate and increase the purchasing power of the community, in
cities and villages. So can grow people's purchasing power again in various ways to be able
to revive the Indonesian economy during a pandemic. So that economic growth for quartiles
1 to 3 in 2021 will not return to the minus line.
Research Methodology
The research method used is case study analysis, with case study analysis regarding
the effect of purchasing power on Indonesian startups during the pandemic. In this study, it
analyzes the state of the purchasing power of the Indonesian people during the pandemic
season as it is today. I took it from several sources to analyze so that it can create good
results. In the case, it will be seen how Indonesian startups can attract buyers to be able to
shop, even in the pandemic season of the corona virus or covid-19.
Efforts to be able to pull back people's power during a pandemic is of course very
difficult. The government has made efforts by providing assistance to be able to regrow
people's buying interest. However, because it is still during a pandemic, it will also be
difficult for people to shop directly. By taking advantage of e-commerce, it certainly makes it
easier for buyers to choose the items they want. Using technology properly will help these
problems.
With the use of e-commerce, it will make it easier for people to shop. One of
Indonesia's major startups, Tokopedia, is able to sell 200 bikes in only 40 seconds 1. Of course
this is something new and rare. We know that asking for charity in Indonesia is still very
minimal. However, with this we can know that little by little people prove that they can rise
again. Without the use of this technology, it will be difficult for business activists to sell their
products. This pandemic is really making the economy into a big economic crisis. With no
income, the production process will also stop. So it can be assumed that the circulation of
money will stop for a while 2.
1
Ayu,Sandra dan Ahmad Lahmi. (2020). Peran e-commerce terhadap perekonomian
Indonesia selama pandemi Covid-19 . 9. 116
2
Pakpahan , Aknolt Kristian. COVID-19 dan Implikasi Bagi Usaha Mikro, Kecil, dan
Menengah.
Results and Analysis
Pandemic
The corona virus or Covid-19 is a major problem in the world today. This virus is
estimated to appear from the end of 2019. This virus spreads rapidly and many say that this
virus can spread through the air and scars from sufferers. So it will be very easy to spread this
virus. This virus is also difficult to contain, nothing can fortify this virus from spreading.
Nobody wants this pandemic, because this pandemic will create a lot of chaos in several
countries. In China alone, as the first country affected by this virus, it is also experiencing the
same thing as other countries.
The Indonesian government has issued an emergency letter for the corona virus
disaster on February 29, 2020. And the World Health Organization (WHO) declared corona
or Covid-19 as a pandemic on March 11, 2020. After being registered in Indonesia, of course
this virus has claimed many victims. The following is a chart of victims of the corona virus
from the beginning to the present 1 December 2020.
Source: kompas.com
From the graphic table above we can see how many cases that have entered and
claimed many lives. Of course this is very influential on the continuity of activities of daily
life. With the emergence of this virus, the government has also provided an appeal for social
distancing or physical distancing. Of course, with this policy, many activities have been
stopped. Especially in economic activities.
The government has also focused on handling or victims of Covid-19. Many things
have been done by the government to be able to anticipate greater transmission. However, as
of January 1, 2021, this case is still being confirmed to continue to increase.
Positive
Recover
Died
751.270
617.936
22.329
This possibility will continue to grow and don't know when it will finish and subside.
The government must be able to work even harder and must do everything possible to
immediately reduce this virus. Because this will greatly affect Indonesia's economic growth.
Besides working with the community to stay at home is not a bad choice. The government
must also provide security guarantees for the communities affected by this pandemic. So that
people know that the government still cares for them.
Inonesia’s startups
In Indonesia there are nearly 2,195 startups and are in the top 5 countries with the
most startups in the world (startup ranking 2020). With that much, of course you should be
able to use it as well as possible. In 2000, for example. Of course it can absorb thousands of
workers. In 2019, Kominfo said that 995 existing and active startups were able to absorb a
workforce of up to 55,903 people. That way, it has helped to reduce the unemployment rate
in Indonesia. Indonesia is also still on the list of 10 countries with the most unemployment
according to Akurat.com and was released on February 10, 2020. However, the onset of the
corona or Covid-19 disaster will further increase the number of unemployed figures. Because
we know that with this pandemic, many factories have laid off their employees.
Source : katadata.co.id
Startup activists have also felt the impact of this pandemic. Coupled with several
policies provided by the government, it will certainly further narrow their operational
activities. There are as many as 42.5 percent of startups that are in bad or even very bad
condition because of this pandemic, but there are still around 24.5 percent of startups that are
still in normal or good condition. Data released by Kompas.com, as many as 20.9% of
startups were able to survive 6 to 12 and 20.1% were only able to survive up to 3 to 6 months.
Then as many as 10.1% of startups that can last less than 3 months.
Startup activists have also arranged many strategies to survive this pandemic. Because
until mid-2020 the pandemic was still very severe, even until the end of 2020 when there
were simultaneous regional elections, making these cases even more numerous. So that the
activists must be able to make a strategy in order to survive in 2021. There are many ways
they do it by reducing several costs. Starting from operational costs, promotion and
production. 51.8% of startups prefer to reduce operational costs by reducing employee
salaries and bonuses. Nearly 59% of startups are optimistic that they can survive until 2021,
but of course there are still some startups that cannot survive until 2021. In fact, it is said that
only 10.1% survive until mid-June 2020.
Startups that are in the agriculture, IT, and payment system sectors are expected to
last quite a long time, compared to education and tourism startups. Because if the situation
doesn't improve it will still get worse in the quartile 1-2021. And it is estimated that nearly
48.9% of startups will last until 2021. Because we can realize that every day, improvements
by startup companies are continuously being made and have shown stability. So it can be said
that it can survive even in the midst of a weakening economy.
The use of e-commerce must also be able to be used properly and be able to make a
solution for satrtup enthusiasts. E-commerce itself is a buying and selling activity carried out
via the internet. By selling or doing business via the internet, of course this can be a solution
for business people to continue running their company. They can sell their products through
the internet. For example, Tokopedia and Grab, two startup companies from Indonesia have
made good use of technology so that they can survive even in the midst of a pandemic like
this. In addition, using e-commerce will certainly reduce the number of corana cases and not
violate health protocols.
Buying Power
This pandemic has weakened purchasing power. With many people affected by
contract terminations or layoffs, they have no income at all. In the economic concept, we
know that the income owned by households affects the demand for goods and services. So
that if people have high income, it will affect the higher their household spending. With the
number of contract terminations or layoffs, household income will be smaller and ultimately
impact on their low purchasing power.
When income is low, of course, people must be able to plan their main needs and
must be fulfilled by them. And to spend the rest of the money they have, of course,
households must be able to think well and add the quality, specification and price factors.
And they must be able to know these factors accurately. Here startups must be able to have a
sense of responsibility in order to be trusted by consumers or households to spend the money
they have on their stores.
The number of millennial generations who are very sophisticated and technologysavvy makes startup activists also have to be able to innovate better and follow trends. By
selling their products online, with a given discount and guarantee that their product will be
able to attract them to spend more of their money. For example, a Tokopedia.
Source : Asosiasi Digital Makerting Indoneisa
The table above is a list of some of the best-selling product categories in Tokopedia
during the 2020 pandemic. It can be seen that consumers have started to become interested in
this Indonesian startup. Apart from Tokopedia, there is also a grab where the company's
income is starting to increase, along with the better economy (Ming Maa, 2020). in the IIII
2020 quartile their income was almost 95% compared to the presence of corona.
With the internet and the easier it is to shop online, it will be easier for households to fulfill
their needs. They don't need to worry about contracting the virus again and can still maintain
their health according to the health protocol that has been issued by the government.
Consumers only need to wait at home and the goods will be delivered by the courier
provided. The strategy of switching from offline to online is one of the best strategies that can
be taken at this time. We don't need direct contact, but can still be connected via the internet
network. And with better development and innovation that can embed the purchasing power
of the community will be higher.
With support from the government by providing direct cash assistance to the
community, it will certainly make the economy better and increase the purchasing power of
Indonesian startups. Because we know that the higher the income received, the higher the
goods to be asked for. And the increasing number of goods demanded by the production
process can run little by little and make the Indonesian economy and the circulation of money
return well. with a good money management system, of course this will also lead to higher
purchasing power.
Conclution
In times of pandemic this may be our new thing. Without the experience of natural
disasters such as the corona virus, it will certainly make you shock and you don't know what
to do so it doesn't spread widely. However, nothing can stem this virus. As a human being
must be prepared for various circumstances, must be able to endure difficult and complicated
conditions. So, the government must have a big role in every handling of natural disasters.
Must be able to work quickly and be able to make decisions that can save a lot of people.
In addition, Indonesian startup activists must also be able to have interesting and
profitable innovations. With this innovation they will be able to survive in any situation. Can
do everything possible so that it can run well and not to have to bleach work relations or
reduce employee salaries. So that the best strategy is needed and is a problem for many
parties. The use of good technology and make the most of it can be one of the best solutions
that can be taken. We have to be aware that the times will continue to develop, develop
continuously forward. Therefore, startup activists must be able to make the best of it. And, to
increase purchasing power again, of course there must be direct assistance from the
government and the creation of new jobs that can still work in accordance with health
protocols. With them getting financial assistance and working, their income will increase and
foster a higher purchasing power of society.
Suggestion
In this pandemic the government cannot work alone, startups work alone and the
community works alone. we have to be united, fight this virus, we have to adhere to
government regulations. As a subordinate, he must be able to carry out orders well, so that
this pandemic problem will end soon. And as a business activist using e-commerce is the best
way for now. Because we know that the government advises staying at home. So, switching
to online will improve people's purchasing power during a pandemic.
References
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selama pandemi Covid-19 . 9.
http://ejournal.unp.ac.id/index.php/jkmb/article/view/109941 (access 5 January 2021)
Case, Karl E. 2006. Prinsip-Prinsip Ekonomi Jilid 1. Jakarta: Erlangga
CBNCINDONESIA. 2020. Tokopedia Mencatat 2 Juta Penjual Baru saat Pandemi.
https://www.cnbcindonesia.com/tech/20201117133504-39-202430/tokopedia-catatpenambahan-2-juta-penjual-baru-saat-pandemi (access1 January 2021)
Detiknews.com . 2020. Kapan sebenarnya Corona pertama kali masuk RI.
https://news.detik.com/berita/d-4991485/kapan-sebenarnya-corona-pertama-kalimasuk-ri (access1 January 2021)
Katadata.com .2020. Strategi Bertahan Startup Digital di Tengah Pandemi Covid-19.
https://katadata.co.id/0/analisisdata/5f1a622e0cc46/strategi-bertahan-startup-digitaldi-tengah-pandemi-covid-19 (access 5 January 2021)
Kusumawati , Dyah dan Saifudin. (2020). PENGARUH PERSEPSI HARGA DAN
KEPERCAYAAN TERHADAP MINAT BELI SECARA ONLINE SAAT
PANDEMI COVID-19 PADA MASYARAKAT MILLENIA DI JAWA TENGAH. 6
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2021 )
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https://scholar.google.co.id/scholar?q=Penerapan+Strategi+Bisnis+di+Masa+Pandemi
+Covid-19&hl=en&as_sdt=0&as_vis=1&oi=scholart (access 2 January 2021)
Pakpahan , Aknolt Kristian. COVID-19 dan Implikasi Bagi Usaha Mikro, Kecil, dan
Menengah. https://scholar.google.co.id/scholar?q=COVID
19+dan+Implikasi+Bagi+Usaha+Mikro,+Kecil,+dan+Menengah&hl=en&as_sdt=0&a
s_vis=1&oi=scholart (access 4 January)
Tokopedia. 2020. Tokopedia ungkap tren penjualan produk olahraga selama pandemi.
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Abstrak
Preliminary
2%
Research Methodology and Results and Analysis on Pandemic
2%
Results and Analysis on Inonesia’s Startups and Buying Power
The last paragraph, conclution and suggestion
Total plagiarism is 4%