The application of porter's generic business strategies and performance of pharmaceutical wholesalers in Kenya
Abstract
This project has examined the application of Porter’s generic business strategies by
Pharmaceutical wholesalers in Kenya and how these strategies have impacted firm’s
performance. By examining these strategies, this project has established the relationship between
strategy adopted and the firm’s performance and also identified some of the challenges faced
while pursuing Porter’s generic strategies. A descriptive cross sectional survey was undertaken.
The population of the study consisted of all registered Multinational Pharmaceutical wholesalers
in Kenya, whose number stood at 40 as at July, 2012. A semi-structured questionnaire was used
to collect primary data from the respondents. From the findings, to a great extent differentiation
strategy and focus strategy were the main strategies used by Multinational pharmaceutical firms
in Kenya. On overall performance majority of the firms were in the category of 41 to 60% rate.
Respondents in the study strongly attributed their firm’s performance to the strategies adopted
thus suggesting that pursuit of one generic business strategy as suggested by Porter, places a firm
in a better strategic position and results in superior performance rather than a situation where the
firm is “stuck in the middle”. Further research to establish factors that lead to change in firms’
competitive strategies within the pharmaceutical industry in Kenya is recommended. It is also
recommended that Multinational pharmaceutical wholesalers should not try to compete with
Asian and local pharmaceutical firms on price, instead they need to market their drugs as
aspirational products for the uppermost earners.
Sponsorhip
University of NairobiPublisher
School of business