The effects of financial and technology literacy on the sustainability of Indonesian SMEs: Mediating role of supply chain practice

Abstract

Most SME owners have understood the importance of several strategies to run their business more professionally. Financial literacy, technological literacy and supply chain practice are some of the important strategies to maintain the sustainability of SMEs. The research was conducted in Indonesia, in the East Java region whereas a developing country, SMEs are the backbone of the economy because most of the people are involved in this sector. The research sample was taken from data recorded at the Export Center office, and as many as 485 SME owners were involved in this study. Quantitative analysis using SEM-PLS analysis found that financial literacy, technological literacy, and supply chain practice contributed positively and significantly to the sustainability of SMEs. If SME owners are aware and understand the importance of financial literacy and are supported by technological literacy and strengthened by supply chain practice, then the opportunity for SMEs to run their business in a sustainable manner is even greater.