Small and Medium Enterprises (SMEs) is a people’s economic activities small-scale in whichthe type of business field is heterogeneous and need to be protected by the government to prevent unfaircompetition. The role of SMEs in the city of Medan is considered very important especially in the fieldof SMEs are labor-intensive, for which SME activities should be promoted and given the easiness bothlicensing issues and other issues so that the products dihasil able to compete with the result of creativitythat is unique, rare and good quality especially in this era of globalization. Previous research has shownthat the entrepreneurial characteristics is positive and significant impact on business competence(Darya, 2012), market orientation positively affects the performance of marketing (Nerver and Sleter,1990), while Li (2000) managed to find the positive influence of a competitive advantage withperformance which is measured by volume of sales. Based on the test results it can be concluded that theentrepreneurial characteristics directly influence the performance of marketing and market orientationaffect the performance marketing through competitive advantage as intervening.