Business Strategy Role in Mediating the Relationship Between Intensity of the Competition and Companys Performance

The aim of this research is to explain the role of business strategy mediation in accordance with the competition and the company’s performance/SME (Small-Medium Enterprise/UKM) ikat woven fabric in Bali Province. The research was conducted in Bali by taking a sample of 55 SMEs spread over 4 region/municipalities in Bali. Sampling was conducted by using purposive sampling in which one person from every SME (owner/marketing manager) was interviewed based on their willingness. Data were analyzed using SEM-based PLS. The results of this research showed that the influence of the competition to the company’s performance was not significant, however, the effect of the competition to the business strategy and furthermore, the business strategy influence to the company’s performance was positively significant. Therefore, business strategy acts as a complete mediating variable (complete mediation).