Competitive strategies adopted by firms in the logistics industry in Kenya

Abstract

The changing global environment has led to more competition, increased product choice, increased customer demand, lower prices, product innovations and information technology. Companies face intense competition from domestic and foreign brands which is resulting in rising promotion costs and shrinking profit margins. Due to changes in the marketplace, companies must cope with the dynamic environment in order to survive. It is the new developments in the market environment that compelled the researcher particularly to conduct a study on the competitive strategies adopted by firms in the logistics industry in Kenya. The study was modeled on a descriptive design. The population of interest in this study consisted of all logistic firms in Kenya. A sample of a hundred companies was considered adequate for this study. Primary data was collected using semi-structured questionnaires. The questionnaires were personally administered by the researcher to the logistic business development managers and marketing managers or equivalent. The questionnaire was divided into three parts. Part A contained questions on general information of the respondents. Part B contained questions on competitive strategies and Part C contained questions on the management perception on the competitive strategies adopted by the firm. Based on the study findings the challenges in strategy implementation are; Lack of financial resources, Poor advances in technology, Small business margins, and increased operational costs. On the other hand the challenges that are considered minor by the organizations are; Diminishing business returns, stringent regulatory framework, Competitor activity in strategy mimics and Lack of employee expertise. It is therefore imperative that the management mobilize funds to improve on their information technology. Increased operations costs problem may be solved by adopting cost effective production and operations methods that emphasize on profit maximization at reduced costs.