Market Orientation and Performance of Food Processing Firms in Nairobi,

Abstract

This paper examines the relationship between market orientation and performance of food processing firms in Nairobi, Kenya. The effect of market orientation on business performance has been researched over the years with authors generally agreeing on its positive outcome. The results show that the development of market orientation in this sector rests more on the attitude of owners/managers and more importantly, the repeatedly reported performance implication of market orientation and innovation is evident in these firms. More specifically, market orientation leads to superior performance under ceaseless competitive conditions. The study focused on forty five food processing firms within Nairobi selected from the Kenya Association of Manufacturers directory (2010). A self administered open and closed ended questionnaire was utilized in collecting primary data from the field. Data was analyzed using descriptive statistics. Frequency tables, means, standard deviation, regression models and correlation analysis were presented to test the relationships between the constructs. The study confirms previous studies on the positive relationship between market orientation and performance. A brief review of the theory and related literature is provided, followed by the development of testable hypotheses. The survey method employed and the chosen statistical structural equation model estimation is explained in detail. The results are discussed and implications are drawn for management in food firms. Finally, the study’s limitations are discussed along with ideas for further research.