Utilization of Social Capital in the Brown Sugar Industry to Maintain Business Continuity in Sukolilo Village, Wajak District, Malang Regency

Abstract

Sukolilo Village is one of 378 villages in Malang Regency with various potentials, one of which is the brown
sugar industry, a local identity of the local community's economy. However, the sustainability of this local
industry is threatened by modernization which has an impact on socio-cultural shifts by prioritizing
production efficiency that abandons traditional values. As a result, local industries are faced with business
competition against large industries in terms of production resources, product competence, distribution
and product prices on the market. The lack of regulations and policies from the government that support
people's businesses makes it difficult for local industries to develop. This study aims to identify the efforts
and the challenges faced by the local community in maintaining their businesses. This research is
important to provide recommendations to maximize the capabilities of industry players in increasing the
resilience of local businesses. Social capital has an important role in maintaining the resilience of local
industries by transforming social resources into economic capital. The methodology used in this study is a
qualitative approach with a descriptive method whose data collection is carried out through observation
and interviews. The results of the study show that social capital in the form of networks, trust, and norms
is a strong foundation in facing external challenges to maintain business continuity. Among them are
helping to mitigate financial risks and maintain business operations. The development of a more
structured and formal social capital can be the right strategic step in strengthening this industry.