Cluster approach is very important as one approaches considered for improving SMEs, the approach is better than the individual approaches. Small-medium entrepreneurs have never had a meeting with other similar companies in their environment. SMEs individually are usually not able to capture market opportunity as a result they often miss the opportunity to exchange information and experiences as well as opportunities for product development collaboration to work on the existing market potential. Business networks are proved effectively to increase business competitiveness due to synergy. In the cluster approach, supporting (both technical, management and financial) distributed to the group rather than individual SMEs. This study aims to analyze the dominant factor effecting the development of business clusters and model development on bamboo crafts industry in Tasikmalaya District using factor analysis. Bamboo industry chosen because it is one of the leading industry in Tasikmalaya district that has a strong brand image and a lot of local employment. The data used primary and secondary data, primary data was collected through stakeholder discussion forums, questionnaires, and interviews with relevant actors, namely local government, educational and training institutions, financial institutions, research and development, business associations, as well as business units which include the workforce in it. Observations directly to the business units also performed to determine the production process and business conditions, particularly in capturing information about the obstacles faced. While the secondary data used are policy documents at the central and local, regional statistical data, and relevant literature.