COMPETITIVE STRATEGIES ADOPTED BY NAKUMATT HOLDINGSLIMITED TO GAIN COMPETITIVE ADVANTAGEBYMIRIAM MUKAMI CHEGEA RESEARCH PROJECT SUBMITTED IN PARTIAL FULFILLMENT OF THEREQUIREMENT FOR THE AWARD OF THE DEGREE OF MASTER OFBUSINESS ADMINISTRATION, SCHOOL OF BUSINESS, UNIVERSITY OFNAIROBIOCTOBER 2014
iiDECLARATIONThis research project is my original work and has not been presented for a degree or anyother award in any other university.Signed:_________________________________Date: _________________________MIRIAM MUKAMI CHEGED61/63155/2011This research project has been submitted for examination with my approval as theUniversity Supervisor.Signed:_________________________________Date: _________________________PROF. EVANS AOSASupervisor, School of BusinessUniversity of Nairobi
iiiACKNOWLEDGEMENTThe attainment of my MBA is a great milestone that I cannot celebrate alone. My sinceregratitude to the almighty God for His steadfast favour, guidance and provision. I am alsoappreciative of my supervisor’s guidance as well as the faculty and fellow classmateswho gave me motivation during the presentation of the research proposal.I am equally grateful to the Chief Executive Officer and managers at Nakumatt Holdingswho were interviewed in this study for their time and acceptance to open up theirbusiness as a case for this study. Finally, I give tribute to my family, parents and siblingswho were a great source of encouragement during the whole period of study andresearch.
ivDEDICATIONThis research project is dedicated to my two dear children, Bridgitte and Bryan for theirinspiration.
vABSTRACTCompetitive strategy in business is central for survival and growth. How well a businessis able to build and sustain its advantage is a question of strategy and how competitivethose strategies are based on internal as well as market dynamics. In Kenya, the retailbusiness has in the last ten years experienced exponential growth. This sector has entereda phase of cut-throat competition with new entrants coming on board and multi-billionshilling expansion plans by key supermarkets including Nakumatt, Uchumi, Tuskys andNaivas. Nakumatt Holdings Limited leads the pack with a turnover ofKES.38 billionand a profit of to KES.312 million in the year to June 2012 compared to its NairobiSecurities Exchange listed rival Uchumi Supermarkets which achieved a profit ofKES.273 million on revenues of KES.14 billion for the year ended June 30, 2012. Thisresearch project is a case study undertaken to establish the competitive strategies thatNakumatt Holdings limited has adopted in Kenya and how such strategies has given itcompetitive advantage in this highly competitive market. This study involved collectingprimary data from face to face interviews with five senior managers in the retailer usingan interview guide and secondary data collected from newspapers, the internet andreview of internal documents.Content analysis was used to analyze the data in line withemerging themes. The study established that strategy has a central place in Nakumatt’sgrowth with numerous strategies having been adopted. These are customer-orientation,