Generic Strategies and Performance of Five Pharmaceutical Distribution Companies in Nairobi City County, Kenya
Loading...
Date
2024-10
Authors
Journal Title
Journal ISSN
Volume Title
Publisher
Kenyatta University
Abstract
The pharmaceutical distribution sector in Nairobi City County, Kenya, faces intense competition, regulatory challenges, and dynamic market conditions. To maintain competitive advantage and improve performance, companies need to adopt effective strategies. However, it remains unclear which generic strategies such as differentiation, pricing strategy or focus are most effective in enhancing the performance of pharmaceutical distribution companies. The study investigated generic strategies and performance of five pharmaceutical distribution companies in Nairobi City County, Kenya. The study was guided by the following objectives; effect of pricing strategy, effect of differentiation and effect of focus strategy on the performance of pharmaceutical distributors in Nairobi County, Kenya. The study was underpinned on the theory of configuration, resource theory, and the Five Forces model of competition which served for the research. The study used descriptive research design. The target population consisted of 45 of the top 5 pharmaceutical distribution companies, making up the sample size of 36, which included the Chief Executive Officer, general manager and marketing manager in the pharmaceutical manufacturing companies. The study was a census of pharmaceutical manufacturing companies in Nairobi. A structured questionnaire was used for data collection. The questionnaire was tested through pilot testing for its validity and reliability. The pilot test was carried out to identify design and instrumentation vulnerabilities and to establish alternative data for probability sample collection. The study was conducted in two pharmaceutical manufacturing firms outside Nairobi city County and 6 senior level managers were involved. Content validity was conducted and Cronbach’s alpha used to test for reliability. The study used primary data which was gathered from the managers. The data was coded and then analyzed using SPSS, Version 22.0. The study determined the association between the dependent and independent variables by employing regression and correlation analysis. The findings showed that differentiation strategy pricing and focus strategy positively and significantly influenced performance of pharmaceutical companies in Nairobi County, Kenya. The study concluded that managing the production expenses enhances business performance as a result of increased profit value. It was recommended that pharmaceutical distribution companies should conduct customer satisfaction surveys in order to bridge the niche that may be identified. This will them in a position to offer the relevant products and services and gain customer loyalty which eventually leads to increased profitability. Future areas of study should focus on other competitive strategies since the three generic strategies that were identified did not account for 100% of the variation in performance of pharmaceutical firms.
Description
A Research Project Submitted to The School of Business, Economics and Tourism in Partial Fulfillment for the Award of The Degree of Master of Business Administration (Strategic Management) of Kenyatta University, October 2024.
Supervisor
John Mutinda