Sustaining Local Food Enterprises Through Social Learning: Comparative Strategic Insights from Malaysia and Indonesia

Small food enterprises (SFE), forming part of small-sized enterprises play a pivotal role in advancing economic development within developing economies. Their operations generate employment and contribute to social development and national progress. Nevertheless, these enterprises face enduring structural and operational constraints that limit scalability, competitiveness, and long-term sustainability. The purpose of this study is to examine the internal and external challenges encountered by SFE in Malaysia and Indonesia, while assessing converging patterns that can guide the formulation of effective policies and targeted interventions for sustainable growth. This research stems from a joint initiative between Universiti Teknologi MARA (UiTM), Universitas Singaperbangsa Karawang (UNSIKA), and Universitas Padjadjaran (UNPAD), conducted via international service-learning projects in both countries. Data were collected through interviews, examination of online platforms, and analysis of strategic management-focused business advisory reports covering three Malaysian and three Indonesian food-related enterprises. The findings reveal strong owner commitment, emphasis on product quality, and customer-centric practices. However, internal barriers and external pressures continue to challenge growth. Despite variations in operational structures and government support, both nations’ SFEs confront fundamentally similar obstacles. This study enriches limited literature and provides valuable insights for policymakers seeking to strengthen resilience, advance digital transformation, and promote sustainable development of local food manufacturers. Importantly, the study introduces the concept of social learning, referring to the systematic dissemination of research findings and strategic recommendations to participating business owners. This feedback mechanism enables enterprises to apply informed insights for continuous improvement, thereby enhancing their adaptability and contributing to the broader sustainable development of SFEs in both nations.

comparative analysis; emerging economies; international service-learning

1. Addisu, B.M. (2024). Business growth determinants in Ethiopia’s WASH sector. Journal of Innovation and Entrepreneurship. https://doi.org/10.1186/s13731-024-00427-y [Google Scholar] [Crossref]

2. Al-Maamari, O. A., Aljonaid, N., & Alrefaei, N. (2025). Impact of microcredit on the performance of micro and small enterprises (MSEs) in Yemen. Cogent Economics & Finance, 13(1). https://doi.org/10.1080/23322039.2025.2460083 [Google Scholar] [Crossref]

3. Ali, M. Y., Abdul Ghaffar, P. Z. A., Kabir, S., & Munir, S. (2022). Halal food export and Malaysia’s potential: The applicability of the gravity theory of trade. Journal of Islamic Marketing, 13(2), 309– 328. https://doi.org/10.1108/JIMA-01-2020-0019 [Google Scholar] [Crossref]

4. Antara News. (2024, March 7). MSMEs contribute 61 percent to Indonesia's GDP: President Jokowi. https://en.antaranews.com/news/307899/msmes-contribute-61-percent-to-indonesias-gdppresident-jokowi [Google Scholar] [Crossref]

5. Arisinta, O., Sakti, H., & Subroto, S. (2024). Increasing the competitiveness of global MSMEs amid inflation. Formosa Journal of Science and Technology, 3(12), 2581–2596. https://doi.org/10.55927/fjst.v3i12.12694 [Google Scholar] [Crossref]

6. ASEAN Coordinating Committee on Micro, Small, and Medium Enterprises (ACCMSME), Economic Research Institute for ASEAN and East Asia (ERIA), & Organisation for Economic Co-operation and Development (OECD). (2024). SME Policy Index: ASEAN 2024 – Enabling sustainable growth and digitalisation. Jakarta, Indonesia: ERIA; Paris, France: OECD. https://asean.org/wpcontent/uploads/2024/09/Full-Report_ASEAN-SME-Policy-Index-2024_20-Sept-2024.pdf [Google Scholar] [Crossref]

7. Asian Development Bank. (2024). Asia Small and Medium-Sized Enterprise Monitor 2024: Designing an MSME ecosystem for resilient growth. https://www.adb.org/sites/default/files/publication/1011576/asiasme-monitor-2024.pdf? [Google Scholar] [Crossref]

8. Barney, J. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17(1), 99–120. https://doi.org/10.1177/014920639101700108 [Google Scholar] [Crossref]

9. Berisha, A., Hoti, A., & Hoti, H. (2023). An empirical study on micro, small, and medium enterprises access to finance in Kosovo: A survey-based analysis. Multidisciplinary Science Journal, 6(5), e2024068. https://doi.org/10.31893/multiscience.2024068 [Google Scholar] [Crossref]

10. Braun, V., & Clarke, V. (2006). Using thematic analysis in psychology. Qualitative Research in Psychology, 3(2), 77–101. https://doi.org/10.1191/1478088706qp063oa [Google Scholar] [Crossref]

11. CEIC Data. (2025). Malaysia Number of Bankruptcies. Retrieved from https://www.ceicdata.com/en/malaysia/number-of-bankruptcies/number-of-bankruptcies [Google Scholar] [Crossref]

12. Chakraborty, A., De, D., & Dey, P. K. (2025). Circular Economy in Small and Medium-Sized Enterprises, Current Trends, Practical Challenges and Future Research Agenda. Systems, 13(3), 200. https://doi.org/10.3390/systems13030200 [Google Scholar] [Crossref]

13. Ćirović, D., Dabić, M., Melović, B., & Backović, T. (2025). Unleashing SME innovation in small open economies: The strategic role of market dynamism, R&D, and organizational capabilities. Review of Managerial Science, Advance online publication. https://doi.org/10.1007/s11846-025-00893-y [Google Scholar] [Crossref]

14. Cueto, L. J., Frisnedi, A. F. D., Collera, R. B., Batac, K. I. T., & Agaton, C. B. (2022). Digital Innovations in MSMEs during Economic Disruptions: Experiences and Challenges of Young Entrepreneurs. Administrative Sciences, 12(1), Article 8. https://doi.org/10.3390/admsci12010008 [Google Scholar] [Crossref]

15. Dabić, M., Maley, J., Dana, L. P., Novak, I., Pellegrini, M. M., & Caputo, A. (2021). Pathways of SME internationalization: A bibliometric and systematic review. Journal of Liberty and International Affairs, 7(3), 12–35. https://doi.org/10.47305/JLIA21370 [Google Scholar] [Crossref]

16. Darmawan, A. A., & Rezki, J. F. (2025). MSME resilience in the face of COVID-19 and beyond: A metaanalysis. LPEM-FEB UI Working Paper, 082. https://en.lpem.org/msme-resilience-in-the-face-of-covid-19-and-beyond-a-meta-analysis-of-factors-that-influence-msme-resilience/ [Google Scholar] [Crossref]

17. Department of Statistics Malaysia. (2024). MSMEs contributed RM613.1 billion to GDP in 2023, affirming their role as the backbone of the economy. SME Corp Malaysia. https://smecorp.gov.my/images/pressrelease/2024/PR31julaiEng.pdf [Google Scholar] [Crossref]

18. DiMaggio, P. J., & Powell, W. W. (1983). The iron cage revisited: Institutional isomorphism and collective rationality in organizational fields. American Sociological Review, 48(2), 147–160. https://doi.org/10.2307/2095101 [Google Scholar] [Crossref]

19. Earnst & Young. (2023). How private and SME businesses can thrive under the Malaysia MADANI roadmap. Ernst & Young Malaysia. https://www.ey.com/en_my/insights/tax/how-private-and-smebusinesses-can-thrive-under-the-malaysia-madani-roadmaps [Google Scholar] [Crossref]

20. Fischer, J. (2016). Islamic branding and marketing: Creating a global Islamic business. Cheltenham, UK: Edward Elgar. [Google Scholar] [Crossref]

21. G20 Global Partnership for Financial Inclusion. (2024). Action Plan for Micro, Small, and Medium EnterpriseFinancing.Retrievedfrom https://www.gpfi.org/sites/default/files/2024%20GPFI%20MSME%20Finance%20Report_V4_0.p df [Google Scholar] [Crossref]

22. Gao, Y., Jiang, B., & Zhou, J. (2023). Financial distress prediction for small and medium enterprises using machine learning techniques. Journal of Financial Analytics, 15(2), 89–102. https://doi.org/10.48550/arXiv.2302.12118 [Google Scholar] [Crossref]

23. Geertz, C. (1963). Peddlers and princes: Social change and economic modernization in two Indonesian towns. Chicago, IL: University of Chicago Press. [Google Scholar] [Crossref]

24. Gutiérrez, E., Sarmiento Suarez, J. E., Ramírez Montañez, J. C., & Rincón Quintero, Y. A. (2025). Determining factors for the digitization of micro, small, and medium-sized enterprises (MSMEs) in Ibero-America. Journal of Innovation and Knowledge, 10(1), 100631. https://doi.org/10.1016/j.jik.2024.100631 [Google Scholar] [Crossref]

25. Hofstede Insights. (n.d.). Country comparison: Malaysia, Indonesia. Retrieved August 19, 2025, from https://www.hofstede-insights.com/country-comparison/malaysia,indonesia/ [Google Scholar] [Crossref]

26. Hussain, A., & Rizwan, R. (2024). Strategic AI adoption in SMEs: A prescriptive framework. Journal of Artificial Intelligence Research, 58, 123–145. https://doi.org/10.48550/arXiv.2408.11825 [Google Scholar] [Crossref]

27. International Monetary Fund. (2024). Indonesia: 2024 Article IV Consultation-Press Release; Staff Report. Retrieved from https://www.imf.org/en/Publications/CR/Issues/2024/07/10/Indonesia-2024Article-IV-Consultation-Press-Release-Staff-Report-503456 [Google Scholar] [Crossref]

28. Israel, B., & Rutainurwa, V. (2025). Dynamic skills for achieving profitability and long‑term sustainability of start‑up MSMEs. Management Dynamics in the Knowledge Economy, 13(1), 85–104. https://doi.org/10.2478/mdke-2025-0006 [Google Scholar] [Crossref]

29. Jackson, M., & Ali, F. (2024). Digital transformation strategy and SME resilience. Journal of Small Business & Entrepreneurship. https://doi.org/10.1080/08276331.2024.2392080 [Google Scholar] [Crossref]

30. Jain, P., Kumar, R., & Meena, M. L. (2023). Challenges and benefits for SMEs in the transformation to smart manufacturing: A systematic literature review. Journal of Manufacturing Technology Management. https://doi.org/10.1108/JMTM-07-2022-0255 [Google Scholar] [Crossref]

31. Juanda, B., Herdiyeni, Y., Anggraeni, L., Probokawuryan, M., Nur’aeni, A., & Setyowawan, D. (2025). Unraveling the empirical impact on MSMEs: Socio-economic characteristics, nudging application, and ecommerce adoption. Journal of Infrastructure, Policy and Development, 9(2), Article 11421. https://doi.org/10.24294/jipd11421 [Google Scholar] [Crossref]

32. KADIN Indonesia. (2023). UMKM Indonesia: Data dan Statistik. https://kadin.id/en/data-danstatistik/umkm-indonesia/ [Google Scholar] [Crossref]

33. Lawrence, P. R., & Lorsch, J. W. (1967). Organization and Environment: Managing Differentiation and Integration. Boston: Harvard Business School Press. [Google Scholar] [Crossref]

34. Loo, M. K., Ramachandran, S., & Raja Yusof, R. N. (2023). Unleashing the potential: Enhancing technology adoption and innovation for MSMEs in Malaysia: A qualitative perspective. Cogent Economics & Finance, 11(1), 2267748. https://doi.org/10.1080/23322039.2023.2267748 [Google Scholar] [Crossref]

35. Malaysian Department of Insolvency. (2024). Bankruptcy Statistic 2024. Retrieved from https://www.mdi.gov.my/index.php/legislation/statistics/75-bankruptcy/2401-bankruptcy-statistic2024 [Google Scholar] [Crossref]

36. McKinsey Global Institute. (2024). The rise of MSMEs: A microscope on small businesses spotting opportunities to boost productivity. McKinsey & Company. https://www.mckinsey.com/mgi/ourresearch/a-microscope-on-small-businesses-spotting-opportunities-to-boost-productivity [Google Scholar] [Crossref]

37. Melaku, K. S., Molla, S., Mekonnen, L., & Gadisa, Z. (2025). Nexus between business development service and women entrepreneurs’ performance: Implication for MSMEs growth and inclusive economic development in Ethiopia. Journal of Open Innovation: Technology, Market, and Complexity, 11(1), Article 100514. https://doi.org/10.1016/j.joitmc.2025.100514 [Google Scholar] [Crossref]

38. Ministry of Cooperatives and SMEs of the Republic of Indonesia. (2021). SME Development in Indonesia. Retrieved from https://www.depkop.go.id [Google Scholar] [Crossref]

39. Mishra, S., Sahoo, D., & Mohapatra, S. (2025). Circular economy adoption in MSMEs: Unveiling enablers and barriers. International Journal of Development Issues. https://doi.org/10.1108/IJDI-06-2024-0163 [Google Scholar] [Crossref]

40. Mohamed Senin, S., Juhdi, N. H., Che Omar, A. R., & Hashim, N. A. (2024). Small and medium enterprises survival during the global crises: a systematic review of theoretical perspectives of building resilience in the time of crisis. Cogent Business & Manag ement, 11(1). https://doi.org/10.1080/23311975.2024.2395428 [Google Scholar] [Crossref]

41. Na, Y. K. (2021). The impact of formal and informal learning on innovation performance: Evidence from SMEs. Journal of Open Innovation: Technology, Market, and Complexity, 7(1), 47. https://doi.org/10.3390/joitmc7010047 [Google Scholar] [Crossref]

42. OECD & ERIA. (2024). SME Policy Index: ASEAN 2024 – Enabling Sustainable Growth and Digitalisation. Retrieved from https://asean.org/wp-content/uploads/2024/09/Brochure_ASEAN-SMEPolicy-Index-2024_20-Sept-2024.pdf [Google Scholar] [Crossref]

43. Oikawa, K., Iwasaki, F., Sawada, Y., & Shinozaki, S. (2024). Unintended consequences of business digitalization among MSMEs during the COVID-19 pandemic: The case of Indonesia (ADB Economics Working Paper Series No. 725). Asian Development Bank. https://doi.org/10.22617/WPS240234-2 [Google Scholar] [Crossref]

44. Oldemeyer, L., Jede, A. & Teuteberg, F. (2024). Artificial intelligence in SMEs: A systematic review. Empirical Economics. https://doi.org/10.1007/s11301-024-00405-4 [Google Scholar] [Crossref]

45. Oliveira, J. P., & Rua, O. L. (2024). Innovation ecosystems and open innovation on micro‑enterprises. Journal of Open Innovation: Technology, Market, and Complexity, 11(5), Article 100443. https://doi.org/10.1016/j.joitmc.2024.100443 [Google Scholar] [Crossref]

46. Ongbali, S. O., Omotehinse, S. A., Adams, C. O., Salawu, E. Y., & Afolalu, S. A. (2024). Analysis of the key factors for small and medium‑sized enterprises growth using principal component analysis. Heliyon, 10(13), Article e33573. https://doi.org/10.1016/j.heliyon.2024.e33573 [Google Scholar] [Crossref]

47. Picón Viana, C. J., Suquillo, E. J., Carmona, C., & Arellano, E. J. (2023). Digital maturity as a determinant of business resilience in microenterprises in Ibero-America: A post COVID-19 analysis. Procedia Computer Science, 219, 485–489. https://doi.org/10.1016/j.procs.2023.09.069 [Google Scholar] [Crossref]

48. Proietti, S., & Magnani, R. (2025). Assessing AI adoption and digitalization in SMEs: A framework for implementation. Journal of Small Business Management. DOI: 10.48550/arXiv.2501.08184 [Google Scholar] [Crossref]

49. Restrepo-Morales, J. A., Ararat-Herrera, J. A., López-Cadavid, D. A., & Camacho-Vargas, A. (2024). Breaking the digitalization barrier for SMEs. Journal of Innovation and Entrepreneurship. https://doi.org/10.1186/s13731-024-00429-w [Google Scholar] [Crossref]

50. Rombaldo Junior, C., Becker, I., & Johnson, S. (2023). Unaware, unfunded and uneducated: A systematic review of SME cybersecurity. Journal of Information Security, 16(1),. . https://doi.org/10.48550/arXiv.2309.17186 [Google Scholar] [Crossref]

51. Rosyidiana, R. N., & Narsa, I. M. (2024). Micro, small, and medium-sized enterprises during the postpandemic economic recovery period: Digitalization, literation, innovation, and its impact on financial performance. Cogent Business & Management, 11(1), 2342488. https://doi.org/10.1080/23311975.2024.2342488 [Google Scholar] [Crossref]

52. Sari, S. A., & Ahmad, N. H. (2025). Enhancing Competitiveness of Small Medium-sized Enterprises during the Post-Pandemic through Intellectual Capital and Technology Capabilities. Global Business Review, 0(0). https://doi.org/10.1177/09721509241301147 [Google Scholar] [Crossref]

53. Satpathy, A. S., Sahoo, S. K., Mohanty, A., & Mohanty, P. P. (2025). Strategies for enhancements of MSME resilience and sustainability in the post‑COVID‑19 era. Social Sciences & Humanities Open, 11, Article 101223. https://doi.org/10.1016/j.ssaho.2024.10 [Google Scholar] [Crossref]

54. Sharma, P., & Gupta, S. (2024). MSME/SME financial literacy: A systematic literature review and future research agenda. Journal of Innovation and Entrepreneurship, 13(1), 24. https://doi.org/10.1007/s13132024-02472-0 [Google Scholar] [Crossref]

55. SME Corporation Malaysia. (2020). SME Annual Report 2019/2020: Building Resilience in Challenging Times. Retrieved from https://www.smecorp.gov.my/index.php/en/resources/2019-2020 [Google Scholar] [Crossref]

56. Sumba-Bustamante, R. Y., Cantos-Figueroa, M. d. L., Santistevan-Villacreses, K. L., SoledispaRodríguez, X. E., Nieves-Lizárraga, D. O., Cervantes-Martínez, L., Ultreras-Rodríguez, A., OlguínMartínez, C. M., Triana-García, R. W., Delgado, D. R., Valencia-Ortiz, D., & Rincón-Guio, C. (2024). Strategic model for strengthening SMEs: An empirical study based on Porter’s Five Forces. Journal of Infrastructure, Policy and Development, 8(10), Article 6435. https://doi.org/10.24294/jipd.v8i10.6435 [Google Scholar] [Crossref]

57. Supendi (2025). Micro-entrepreneurs and economic challenges: A post-pandemic urban study. Finanomics: Journal of Economic and Financial Studies, 1(2). https://journals.aimrc.com/finanomics/article/view/152 [Google Scholar] [Crossref]

58. Supramono, S., Damayanti, T. W., & Adhitya, D. (2025). Dynamic capabilities and financial behavior to accelerate MSME performance recovery and its impacts on business sustainability. Journal of Innovation and Entrepreneurship, 14(1), Article 10. https://doi.org/10.1186/s13731-024-00456-7 [Google Scholar] [Crossref]

59. Tu, Y.-X., Kubatko, O., Melnyk, L., Li, R., Kovalov, B., & Yaremenko, A. (2024). Economic, institutional and environmental drivers of SMEs’ development in the EU: Sustainable development goals perspective. Environmental Science and Pollution Research. https://doi.org/10.1007/s10668-024-05686-z 60. Tudose, M. B., Ionesi, S. D., Dulgheriu, I., Buhu, L., & Rusu, V. D. (2024). Micro, Small or Medium, New or Old, Are There Differences? Testing Business-Specific Difficulties. Mathematics, 12(24), Article 3912. https://doi.org/10.3390/math12243912 [Google Scholar] [Crossref]

60. Vasani, S., & Abdulkareem, A. M. (2024). MSME market presence and competitiveness in a global economy. Cogent Economics & Finance, 12(1). https://doi.org/10.1080/23322039.2024.2416992 [Google Scholar] [Crossref]

61. Vásquez, P., Gallego, V., & Soto, J. D. (2024). Transforming MSMEs towards circularity: An attainable challenge with the appropriate technologies and approaches. Environment Systems and Decisions, 44(3), 624–644. https://doi.org/10.1007/s10669-023-09961-8 [Google Scholar] [Crossref]

62. World Bank. (2024). Enterprise Surveys: Indonesia 2024. Retrieved from https://www.enterprisesurveys.org/en/data/exploreeconomies/indonesia/2024 [Google Scholar] [Crossref]

63. Zacca, R. (2025). Leveraging network capability for SME success. Journal of Small Business Management. https://doi.org/10.1080/00472778.2025.2478448 [Google Scholar] [Crossref]

• The Role of Value and Growth Stocks in Portfolio Returns: Insights From the Nigerian Stock Market
• The Impact of Environmental, Social, Governance (ESG) and Profitability on Firm Value Moderated by Firm Size
• Assessment of the Impact of Environmental Operating Costs on Return on Assets: Evidence from Listed Breweries in Nigeria
• Mobile Money and Digital Financial Services Ecosystem in Adamawa State
• A Quantitative Approach of Professional Skepticism and Fraud Detection among Malaysian Internal Auditors