ABSTRACT
MSMEs (Micro, Small, Medium Enterprises) have a strategic position in the Indonesian economy, but they have problems in terms of capital and business management capabilities. The purpose of this research is to build a model that is useful for improving performance. This research uses all MSMEs businessmen in the batik sector in Rembang Regency with 135 respondents. Completion of structural equations, using Lisrel version 8.8. All research hypotheses are accepted. This research can prove that MSME business people need to have insight into entrepreneurial orientation and customer orientation. Because both are useful for companies, in building competitive advantage. However, customer orientation and competitive advantage play a big role in improving UKMK performance.
