The Effect of Financial Literacy of MSME Owners on Accounting Information in Financial Management Decision Making

Abstract

Radzaa Handicraft is a business engaged in arts and crafts, founded in 2021 by Mr. Ustadus Solihin, S.E., M.M., who is also a lecturer at the Faculty of Economics at Kadiri Islamic University. Before becoming Radzaa Handicraft, this business was known as Mahar Embosing. This transformation marks a strategic step to expand the market and strengthen the brand. Mr. Ustadus uses his academic experience and self-taught learning in the field of e-commerce to manage his business. This knowledge is mostly gained from platforms like YouTube, which are a major source of understanding the dynamics of online trading. Mr. Ustadus chose to use the Shopee application to record expenses and income because of the convenience and simplicity it offers. The app also provides automated financial reports that help in strategic decision-making. The use of this application is considered more practical compared to manual bookkeeping methods, which are often time-consuming and prone to errors. Mr. Ustadus also realizes that one of the common problems faced by MSME actors is the lack of separation between personal and business finance. This often leads to difficulties in determining the selling price, calculating profits, and overall financial management. Innovation is also one of the keys in the development of Radzaa Handicraft. Realizing the importance of safe packaging for products sent outside the city of Kediri or East Java, Mr. Ustadus designed special packaging using wooden crates, bubble wrap, and cardboard. At first, the volume of orders received was not very large, but as demand increased, this packaging innovation became more and more significant. He collaborated with craftsmen to make wooden coffins at a price of Rp 5,000 per unit, then sold a complete packaging package at a price of Rp 50,000 per unit. This package not only ensures the safety of the product until it arrives in the hands of consumers, but also provides additional benefits for businesses. With more than two years of experience and an increasingly extensive network of relationships, Radzaa Handicraft has shown significant growth. The ability to overcome various business challenges, including aspects of financial management and product innovation, is an important factor that drives the success of this business. Radzaa Handicraft is constantly evolving, offering high-quality products combined with innovative and safe packaging services.