Pengaruh Green Product Innovation terhadap Competitive Advantage dengan Green Dynamic Capability Sebagai Variabel Mediating pada UMKM Bakery Kota Padang

Increasing environmental awareness and demand for environmentally friendly products encourage companies to develop them for competitive advantage despite higher costs. The bakery sector, one of the growing SMEs in West Sumatra, including in Padang City, is experiencing increasing bread consumption but also increasing pollution, waste, and energy use. Green product innovation and dynamic capabilities are essential to reduce environmental impacts while increasing competitiveness. This study examines the impact of green product innovation on competitive advantage, mediated by green dynamic capabilities, using 210 manager-level respondents analyzed with SmartPLS 4. The research findings show: 1) Green product innovation positively affects competitive advantage, 2) Green product innovation also positively affects green dynamic capabilities, 3) Green dynamic capabilities enhance competitive advantage, and 4) Green product innovation significantly mediates the relationship between green product innovation and competitive advantage.