Abstract:

Furniture is one of the potential commodity owned by Indonesia. It ranks second from the top tropical country that exports furniture. However, Indonesian furniture industry has fallen down year to year and faced the degradation of the total amount of furniture export. It caused of several issues, which are the high cost of logistics, high minimum wages, high taxes, low worker's productivity and the government's regulations that burden local industries, including Jepara, one of the potential city that produced high-quality of wood furniture and contributed 10% of total amount of the national exports. On the other side, the growth of digital industries in Indonesia is growing rapidly in last 6 years. As a result, many e-commerce arose in order to resolve various problems in distinct field, also gave an impact on economic value in Indonesia. Furthermore, in 2019 the growth of national digital industries is expected to grow above 11% per year. Hence, in this paper will discuss the background of the condition and its potential of Indonesian furniture industry, particularly in Jepara and how important the digitalization to be a solution to develop Indonesian furniture market with the adoption of the business model in e-commerce such as B2B and B2C. The outcome of this paper is expected to get a support from the Indonesian government and stakeholders to implement the idea to build platform technology that can help Indonesian furniture industry to raise the market and the number of exports.