RADAR TULUNGAGUNG – The Tulungagung SMEs legalization drive has intensified as the regency pursues its ambition to become Indonesia’s “city of one million SMEs.” As of February 2026, local authorities have recorded 259,897 micro-enterprise units. Therefore, the region already holds a substantial grassroots economic base.

Tulungagung Cooperatives and Microenterprise Office said the policy focus has shifted from merely increasing  numbers to upgrading enterprise capacity. According to agency head Slamet Sunarto, the next phase aims to help micro businesses scale into small and medium enterprises.
“Our goal is not just more SMEs, but stronger ones that move up the ladder,” he said.

Currently, food and beverage businesses account for 54.8% of Tulungagung’s SMEs. Meanwhile, fashion contributes about 26%, crafts 13%, and the rest comes from other creative industries. Consequently, the structure reflects strong consumption demand.

However, it also reveals diversification and competitiveness challenges. Without innovation and product standards, many SMEs risk remaining confined to local markets and missing broader opportunities.

Therefore, the government has prioritized business legalization programs. Authorities assist entrepreneurs in obtaining business identification numbers (NIB) and registering trademarks. As a result, products gain legal protection and improved access to financing and modern retail channels.

“Stronger legality raises market trust,” Slamet said. Moreover, officials believe formal status helps SMEs enter larger supply chains and institutional procurement systems.

Tulungagung’s SME vibrancy appears each Sunday during car-free-day markets. Around 600 vendors participate regularly. Within just three hours, transactions reach between Rp200 million and Rp250 million.

Furthermore, hundreds of additional traders remain on waiting lists to join. Thus, strong demand signals expanding grassroots commerce and rising entrepreneurial participation.

However, scaling SMEs requires more than legalization alone. Therefore, authorities now plan a “curation house,” a facility designed to evaluate and upgrade product quality for large-scale orders.

At present, many Tulungagung SMEs pass provincial product selection processes. Nevertheless, they struggle to meet mass-production capacity. Consequently, the proposed center would support packaging, quality control, and production readiness.

Finally, officials emphasize cross-sector collaboration between government and private industry to accelerate SME upgrading. In fact, regional economic growth cannot rely solely on public budgets.

At the provincial level, cooperatives and SMEs contribute 60.09% to East Java’s gross regional domestic product. Hence, the sector clearly forms the backbone of local economies.

With nearly 260,000 enterprises already operating, Tulungagung holds strong initial capital. Ultimately, reaching one million SMEs requires ensuring businesses remain sustainable, competitive, and legally compliant.
“One million SMEs is not just a number,” Slamet said. “It means one million strong, legal, and competitive enterprises.”