FOSTERING INCLUSIVE ENTREPRENEURSHIP: INTEGRATING TEACHING FACTORY AND BUSINESS INCUBATION IN VOCATIONAL SCHOOLS

Objective: Vocational education faces a critical challenge in fostering entrepreneurship and independence, particularly for students with special needs or from vulnerable socio-economic backgrounds. This study aims to develop, validate, and evaluate the effectiveness of an Inclusive Business Incubator (IBI) model in Vocational High Schools (SMK) by integrating the Teaching Factory (TeFa) concept with university-based business incubation practices. Method: Employing a Research and Development (R&D) approach based on a modified six-stage Borg and Gall model, the study involved preliminary research, model design, expert validation, and field testing at SMKN 1 Probolinggo, Indonesia. Data were collected through questionnaires, interviews, and documentation from academic experts, industry practitioners, and students. Results: Quantitative descriptive analysis revealed that the IBI model is highly viable. The developed model achieved a feasibility score of 89.6% and a practicality score of 86.98%. Furthermore, the model demonstrated high organizational effectiveness (87.6%) in enhancing students' entrepreneurial competencies. Novelty: The findings indicate that integrating TeFa with an inclusive incubation framework supported by industry mentorship—successfully provides equal opportunities for all students, including those with disabilities, to develop start-up businesses. This model offers a strategic pathway for vocational institutions to foster inclusive entrepreneurship and reduce youth unemployment.