MSME: The Role of Production Management in Determining Competitive Selling Prices

Abstract

In fact, up to the present, the existence of MSMEs remains in a poor condition. In almost all countries, only a very small number of MSMEs are able to survive and develop into medium or large scale. The inability of business management, such as efficient production management and determination of profitable and sustainable selling prices, has always been a major obstacle faced by MSMEs. Tepung Talas Rusman (TTR) is an MSME that produces taro flour. This complementary product has a narrow market share with high price competition so that the management of production and determining the right selling price will greatly determine its ability to face competitors. This study aims to determine the application of production patterns and the calculation of appropriate production costs in determining competitive selling prices. The results showed that the constant production pattern and the use of ROI Pricing mark up method on TTR UMKM will create profitable and competitive selling prices so as to guarantee the profitability and sustainability of its business.

Keyword: Production pattern, cost of production, mark up method, selling price