According to the survey conducted by the Demographic Institute of the University of Indonesia (UI) in collaboration with ride-hailing firm Gojek, 77 percent of “social sellers” expect their revenue to remain under pressure due to the ongoing global health crisis.

UI’s Demographic Institute describe social sellers as entrepreneurs who use social media and other online platforms to market their products to their consumers.

“MSMEs in Gojek’s ecosystem acknowledged that the pandemic would continue to affect their businesses in the near future,” the institute’s deputy chairperson, Paksi Walandouw, said during an online press conference on Monday.

The survey highlighted a range of factors induced by the COVID-19 pandemic that affect MSMEs’ operations, including the increasing costs of raw materials, falling demand, supply chain disruption and cashflow difficulties.

Small and medium enterprises, which account for more than half of the country's gross domestic product (GDP), have been particularly hard hit by the economic downturn, as the government expects the economy to grow by 1 percent at best or shrink by 0.4 percent at worst this year. The GDP contracted by 5.32 percent year-on-year in the second quarter, Statistics Indonesia (BPS) announced Wednesday.

Falling demand has become a major factor affecting small businesses, with 85 percent of MSMEs seeing declining sales between March and June, the survey data show. Forty-four percent of them saw sales drop by more than half.

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