Influence of Focus Strategy on Customer Loyalty among Small and Medium Enterprises in Garissa Town, Kenya
- March 24, 2020
- Posted by: RSIS
- Categories: Business Administration, IJRISS
International Journal of Research and Innovation in Social Science (IJRISS) | Volume IV, Issue III, March 2020 | ISSN 2454–6186
Feisal Hussein Farah1, Dr. Patricia Kungu2
1,2Department of Business Administration, School of Business, Kenyatta University, Kenya.
Abstract: In today’s rapidly changing economic and business environments small and medium enterprise compete for customers, revenue, market share with products and services that meet customer’s needs. In this way, they gain competitive strategy which aims to establish a profitable and sustainable position against the forces that determine industry competition. However, Small and medium enterprise firms are increasingly facing numerous challenges in their quest to maintain their market share in this global business environment. This study investigated the influence of focus strategy on customer loyalty among small and medium enterprises in Garissa Town, Kenya. This study was carried out through a descriptive research design. The target population consisted of 450 retail businesses which were registered as retail business with ministry of trade in the county government of Garissa in year 2017. Stratified proportionate random Sampling technique was used to select the sample. The sample size was 75 respondents were obtained. The data collection instruments used for this study were questionnaires for all the respondents. Descriptive statistical analysis such as mean and standard deviation were used to analyse quantitative data and presented in terms of tables, frequencies, graphs and charts. Because the study involved more than three variables multiple regression analysis was used. The study examined that focus strategy and strategic alliance strategy had a positive and significant influence on customer loyalty. The study concluded that focus strategy enables SMEs to generate strong customer loyalty by tailoring their business to the needs of a small group. The study recommended that Small and Medium Enterprises in Garissa Town should focus on the most profitable market segment that bring in more revenue and more on the value chain as this will increase differentiation in the product offered in turn increasing the revenues.
Keywords: Focus Strategy, Customer Loyalty.
I. INTRODUCTION
An organizational strategy aims at achieving advantage for the organization through transforming resources within a changing environment and to fulfill stakeholder’s expectations (Botten & McManus, 2012). These authors also view strategy as a long-term business plan for the effective management of environmental opportunities and threats in light of a company’s strengths and weaknesses.
