BUSINESS LEVEL STRATEGIES AND PERFORMANCE OF SELECTED SUPERMARKETS IN NAIROBI CITY COUNTY, KENYA
BUSINESS LEVEL STRATEGIES AND PERFORMANCE OF SELECTED SUPERMARKETS IN NAIROBI CITY COUNTY, KENYA
Joan Kadenyeka - Master of Business Administration (Strategic Management), Kenyatta University, Kenya
Evans Mwasiaji - Lecturer, Department of Business Administration, Kenyatta University, Kenya
ABSTRACT
Commercial entities operating in a globalized and competitive business environment must adopt a market posture that allows them to effectively use their strengths, resources and innovations to take advantage of available opportunities in line with organizational objectives, while simultaneously hedging against potential threats. The chosen market posturing is made possible through effective implementation of appropriate strategies at the corporate, business, functional and operational levels. In Kenya, ten supermarkets in the retail trade sector within the last decade have had to close their business leading to job losses and negative impact on the national economy. This study anchored on dynamic capability theory, therefore sought to examine business level strategies and their effect on the performance of selected supermarkets in Nairobi City County in Kenya. Descriptive research design was adopted for this study. The unit of analysis was nine supermarkets, while the unit of observation selected using census method was sixty three managerial staff including senior executives in the areas of Finance, Human Resources, Marketing, Information Technology, Business Development, Purchasing and Supply Chain Management. A self-administered semi-structured questionnaire was used in collecting both qualitative and quantitative data in line with the specific objectives of the study. SPSS software was used to compute descriptive statistics to depict the characteristics of the study variables through tables and graphs. This study with a 65.07% response rate, established that there is a positive link between the supermarket’s performance and the three business level strategies of cost leaderships (β=0.240 and p=0.007); differentiation (β=0.629 and p=0.000) and focus (β=0.212 and p=0.037). Analysis of data showed that higher levels of strategy implementation led to enhanced performance, and vice versa. The position taken by this study therefore is that business level strategies are critical in facilitating the realization of supermarkets’ performance in Nairobi City County, Kenya. This study therefore recommends that the Government of Kenya ought to review relevant policies to lower the cost of doing business including improvement in infrastructure, while the supermarket’s strategies should target minimization of operational costs, offer lower cost commodities, invest in product innovations, adopt modern technology and undertake market focused research. The expected study output upon successful implementation of the given recommendations is enhanced performance of supermarkets in Nairobi City County.
