Strategic responses to competition among large fast food restaurants in Nairobi central business district

Abstract

The fast food industry in Nairobi Central Business District has in the past years witnessed dramatic changes brought about by competition. The fast food outlets try to outdo each other by way of differentiation in terms of the food they serve. Consequently, all fast food outlets have to continuously monitor and adapt to the environmental changes. As a result of this, firms have to employ various strategies to survive in the industry. The study sought to find and establish the strategic responses to competition among large fast food restaurants in Nairobi Central Business District (NCBD). The study also sought to highlight the various challenges these firms have to contend with. Towards this end, the study collected primary data from the outlets on the strategic responses they apply. The data was collected through the administration of questionnaires to the outlets. The study established that the outlets have specific target markets to serve, what they stock mostly determines the type of customers, branding of an outlet differentiates it from others, the outlets use brand names in order to cultivate customer loyalty, ensuring high quality of food and services and entrance into new markets. Increasing number of outlets, security measures, convenience and ease of accessibility, attractive outlet layout and design, consistency with other outlets, general cleanliness of outlet and uninterrupted power and water supply were all used by the outlets to beat competition in the market. The findings also show that the outlets use all the three strategic options available to a firm that is focus, differentiation and cost leadership. Key challenges faced by the outlets were identified as financial requirement, competition from smaller outlets, substitutes, changing consumer tastes and preferences, provision of reliable utilities by suppliers and ability and skills of staff. The study therefore recommends the use of market survey before deciding target customers, use of brand name to the satisfaction of customers and the outlets should factor in competitive challenges faced which have been highlighted as affecting the customers. Key Words: Strategic responses, Competition, Large fast food restaurants, Nairobi Central Business District.