Competitive strategies adopted by second hand motor vehicle dealers in Nairobi, Kenya

Abstract

The objective of this study was to establish the competitive strategies used by second hand motor vehicle dealers to cope with increased competition in the second hand motor industry. To achieve the objective a survey was conducted, subsequently the shareholders and managers of the second hand motor dealer showrooms were asked to complete a questionnaire. 54 out of the targeted 66 respondents completed and returned the study questionnaire representing 82% response rate. It was found that 67% of the surveyed second hand motor dealer showrooms have been in operation for less than five years, 89% of them are limited companies and 96% of the surveyed respondents were aware that the industry faced stiff competition. It was found that email circulation of cars on offer to friends, sale of cheap cars, stocking of unique cars, offering of value adding services like car cleaning and fixing alarms are particularly popular competitive strategies with second hand motor dealers, they are used to a great extent by the surveyed second hand motor dealers. The study established that Porter‟s generic strategies are moderately used. The second hand motor dealers use the cost leadership, focus and differentiation strategies interchangeably. On factors influencing competitiveness, hiring competent staff is the strategy that came out very to be very popular.