Abstract: Micro Enterprises (MEs) play an important role in the Kenyan economy mainly through its contribution to the country’s GDP and employment. Despite their role, research has shown that MEs face a range of problems leading to their high mortality rate. In spite of continued efforts by donor communities, private sector organizations and the government of Kenya to offer support to MEs; the effect has been negligible. Competition has been identified as one of major causes of MEs’ failure. This study aimed at establishing the role of Competitive Strategies on the financial performance of MEs in Kenya; with a focus on Industrial Knitting Micro Enterprises (IKMEs) in Kiambu County. The study was based on the Porter’s Generic Competitive Strategy Matrix: Cost Leadership, Differentiation and Focus. Scholars have posited that there is limited research about the micro enterprise sector in Kenya and other developing countries. Little has been studied on the influence of competitive strategies on the non financial performance of MEs in Kenya. This study adopted a survey research design. The target population was 90 IKMEs operating in Kiambu County; and was stratified into homogeneous categories as formal and informal. A sample of 40 IKMEs was drawn proportionately and randomly from the strata. Business owner-managers were the respondents. Data collection method was both qualitative and quantitative aided by Questionnaires as data collection tools. Analysis was by descriptive statistics and used relevant computer packages. Results were presented in both tabular and graphic formats. Results of this study indicate that competitive strategies directly and significantly affect non-financial performance of IKMEs. The Owner-managers pursued focus strategy as their competitive strategy. The IKMEs should maximize their sales during peak periods and intensively employ competitive strategies during off peak periods. The government and other private training organizations need to focus more on competitive strategy training needs among SMEs and set relevant legal framework to level the field.
Keywords: Competitive Strategies; Non-Financial Performance; Micro and Small Interprises; Industrial Knitting Micro Enterprises.
Title: Competitive Strategies and the Non Financial Performance of Micro Enterprises in Kenya
Author: Daniel Kitonga Kimatu, Dr. Okibo Walter Bichanga
International Journal of Management and Commerce Innovations
ISSN 2348-7585 (Online)
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