Competitive Strategies and Performance of Selected Car Rental Businesses in Nairobi City County, Kenya

Abstract

Performance is the process of measuring action where us competitive strategies entails the management’s activities that enabling it to successfully challenge a competitor in the same business or industry. Car rental business has been on the rise in Nairobi City County with reports of good returns. Due stiff competition which has been observed among businesses in the car rental businesses, there is need for a firm to embrace competitive strategies to survive and remain operational. The purpose of this study was to determine the effect of competitive strategies and performance of selected car rental businesses in Nairobi City County, Kenya. Specific objectives was to determine the effects of cost leadership strategy on performance of selected car rental businesses in Nairobi City County, Kenya, to determine the effect of differentiation strategy on performance of selected car rental businesses in Nairobi City County, Kenya, to determine the effect of low-cost focus strategy on performance of selected car rental businesses in Nairobi City County, Kenya, and to determine the effect of differentiation focus strategy on performance of selected car rental businesses in Nairobi City County, Kenya. This study was aimed at providing insight on the competitive strategies adopted by the car rental business to achieve competitiveness and increase their performance considering there are many car rental businesses operating in Nairobi City County. This was a cross-sectional descriptive study design where purposive sampling technique was used to select fifteen (15) car rental businesses in Nairobi City County. In purposive sampling technique only the car rental businesses that met the inclusion criteria for this study were recruited and enrolled. Stratified and simple random sampling technique was employed in recruiting three categories of respondents. The three categories of staffs included, top level, middle level and bottom level management. Structured questionnaires were used to collect primary data which will be analyzed by Statistical Package for Social Science (SPSS) version 22. Descriptive statistics, regression and correlation analysis was used to give the results of the study. The findings of the study revealed that competitive strategies had no effect on performance of selected car rental businesses in Nairobi City County, Kenya and as a result, this study adopted the null hypothesis. The results of cost leadership strategy, differentiation strategy, low-cost focus strategy, and differentiation focus strategy on performance recorded a P value greater than 0.05 which was not statistically significant. In addition, there was a significant (P value less than 0.05) correlation between, cost leadership strategies, differentiation strategies, low-cost focus strategies, differentiation focus strategies and performance. In conclusion, competitive strategies adopted by the selected car rental businesses in Nairobi City County, Kenya had no effect on their performance. The study recommends that car rental businesses should consider using corporate social responsibility as a competitive advantage to enhance their performance.