To survive in competition with big companies, the Small Medium Enterprises (SMEs) should have a capability to recognize their own supply chain, and start to explore the innovation of their products through supply chain collaboration. The objective of this research is to examine the relationship between Supply Chain Collaboration of Value Innovation (SCCVI) in the SMEs and Supply Chain Capability (SCC) as a mediator to achieve Competitive Advantages (CA). This research is a descriptive study with the quantitative analysis using partial least square method with the second order model analysis using Smart PLS 3. The data was collected by using the questionnaires based on the purposive sampling method. The result of this research showed that the SCC could mediate between the SCCVI and the CA; there was a positive direct relationship between the SCCVI and SCC; also, there was a positive relationship between the SCC and the CA. In other words, if the small medium enterprise does a good supply chain collaboration, it will create a good supply chain ability; and then, when the supply chain ability is good, it will increase its competitive advantages. The suggestion for the further research is that investigating the relationship among the variables used in this research in other creative industries.