ACTIVITY-BASED COSTING CAPABILITY AS A DETERMINANT OF OPERATIONAL EFFICIENCY AND COMPETITIVENESS OF FOOD MSMES: EMPIRICAL EVIDENCE FROM WEST JAVA
DOI:
https://doi.org/10.58174/ijqmr.v1i9.137Keywords:
Activity-Based Costing; MSMEs; Operational Efficiency; CompetitivenessAbstract
Micro, Small, and Medium Enterprises (MSMEs) in the food and beverage processing industry sector in West Java face increasingly complex cost management challenges amid post-pandemic market dynamics, raw material inflationary pressures, and intensification of digital competition that requires a much more systematic and data-based cost management approach. This study aims to analyze the influence of Activity-Based Costing (ABC)-based cost management capabilities on the operational efficiency and competitiveness of MSMEs in the food and beverage processing industry sector in West Java for the 2021–2024 period. A quantitative approach with a descriptive-associative design was used through the collection of primary data from 287 respondents of MSME owners or managers who were analyzed using Structural Equation Modeling based on Partial Least Squares (SEM-PLS) with SmartPLS 4 software. The results of the study confirm that ABC-based cost management capabilities have a significant positive effect on operational efficiency (beta = 0.423; p < 0.001) and MSME competitiveness (beta = 0.387; p < 0.001), with operational efficiency partially mediating the relationship between ABC capability and competitiveness (indirect effect = 0.164; p < 0.001). The research model explains 68.7 percent variation in the competitiveness of MSMEs. This study provides evidence-based empirical guidance for MSME actors and policymakers in strengthening cost management systems as the foundation of sustainable competitiveness
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