FACTORS AFFECTING CONSUMER DEMAND IN THE RETAIL INDUSTRY IN KENYA: A CASE STUDY OF AL-FATAH SUPERMARKET LIMITED

BY ABDIKADIR GUDLE

A RESEARCH PROJECT SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE AWARD OF DIPLOMA COURSE IN

MANAGEMENT (BUSINESS MANAGEMENT OPTION) OF THE KENYA INSTITUTE OF MANAGEMENT

APRIL 2012

DECLARATION Declaration by the student This research study is my original work and has not been presented to any other examination body. No part of this research should be reproduced without my consent or that of The Kenya Institute of management. Name _____________________Sign ____________________Date_________________ TKA /DBM/01871

Declaration by Supervisor This research has been submitted for defense with my approval as the Kenya Institute Of Management Supervisor . Name _____________________Sign _________________ Date __________________ Lecturer supervising

For and on behalf of the Kenya Institute of Management Name _____________________Sign ____________________ Date ________________ Branch Manager Nairobi Branch.

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DEDICATION I dedicate these projects to my religion(Islam),my mother Fatuma Jama and my brother Salan Gudle not to forget my best friends Mubarak Mohammed and javan mwichigi who supported me throughout the course. I also dedicate these projects to my supportive friends who supported me during this process.

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ACKNOWLEDGEMENT I greatly acknowledge my sincere love and indebted thanks to my supervisor, Mrs. Jane munga for her guidance and support while writing this project. Without her tireless and selfish less input, this work could have taken much longer. Also special acknowledgement goes to Mubarak Mohamed , friend for his moral support and encouragement while writing this research project. His contributions in availing relevant information and ready willingness to assist when need arose helped me give shape to this work.

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ABSTRACT The lack of knowledge emphasis and intensive investments into the factors that influenced consumers demand can be a source of more frustrating and wasteful venture for any entrepreneur involved in the trade of goods and/or services targeted to a final consumer. This study sought to establish factors that influenced demands of locally manufactured goods in the leading retail outlets. Factors that were key to this study were; corporate image, pricing, quality, competition and dealer support. Many

manufacturers of locally made goods had time and again voiced the lack of support on the locally made goods by the local consumer. The said manufactured have repeatedly gone to the press through the KAM, to fight foreign goods whose equivalent was

available locally. This was thought to have been a waste of resource due to lack of the manufacturers of locally made goods to identify the reasons that lead the local consumer opt for imported goods whose equivalent was available locally. The researcher collected date relevant to the study, through questionnaires designed using structured and unstructured questions. The questionnaires were sent to targeted

respondents chosen one of the leading organization in the retail trade , the Al-Fatah Supermarket Limited. The collected data was analyzed both qualitatively and

quantitatively, for better and clear results of the findings, which represented the views of the purchasing decisions makers at the said organization from which a

generalization of the outcome was drawn. The major finding of the research was that; Corporate image , pricing , quality , competition and dealers support were indeed factors that influenced consumers demand of the locally manufactured products. Corporate image, pricing, quality and dealers support influenced consumers demand to a very great extent. Corporate image , pricing quality , competition and dealers support of locally made goods were very poor and needed an urgent face lift for the manufacturers of locally made goods to realize increased support from the local consumers /buyers thus realizing increased returns on every of their shilling spend.

TABLE OF CONTENTS Title Page

Declaration-----------------------------------------------------------------------------------ii Dedication-----------------------------------------------------------------------------------iii Acknowledgement -------------------------------------------------------------------------iv Abstract---------------------------------------------------------------------------------------v Table of contents---------------------------------------------------------------------------vi List of Tables------------------------------------------------------------------------------viii List of Tables--------------------------------------------------------------------------------ix List of acronyms-----------------------------------------------------------------------------x Operational definition of terms-----------------------------------------------------------xi CHAPTER ONE INTRODUCTION TO THE STUDY 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 Introduction-------------------------------------------------------------------------1 Background of the study-----------------------------------------------------------1 Statement of the problem----------------------------------------------------------4 Objectives of the study------------------------------------------------------------5 Research questions-----------------------------------------------------------------5 Significance of the study----------------------------------------------------------5 Limitation of the study------------------------------------------------------------7 Scope of the study ----------------------------------------------------------------7 CHAPTER TWO LITERATURE REVIEW 2.1 2.2 2.3 2.4 2.5 Introduction -----------------------------------------------------------------------8 Review of theoretical literature ------------------------------------------------8 Review of Critical literature and Gaps to be filled -----------------------25 Summary ------------------------------------------------------------------------26 Conceptual Framework--------------------------------------------------------31

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CHAPTER THREE RESEARCH DESIGN AND METHODOLOGY 3.1 3.2 3.3 3.4 3.5 3.6 Introduction-------------------------------------------------------------------------33 Study Design -----------------------------------------------------------------------33 Target Population------------------------------------------------------------------33 Sample Design ---------------------------------------------------------------------34 Data Collection Procedure/ instruments----------------------------------------35 Data Analysis Methods-----------------------------------------------------------36 CHAPTER FOUR DATA ANALYSIS, INTERPRETATION AND PRESENTATION OF FINDINGS 4.1 4.2 4.3 Introduction-------------------------------------------------------------------------37 Presentation of Findings (As Per the Research Objectives) ---------------37 Summary of Data Analysis------------------------------------------------------52 CHAPTER FIVE SUMMARY OF FINDINGS, CONCLUSIONS AND RECOMMENDATIONS 5.1 5.2 5.3 5.4 5.5 Introduction-----------------------------------------------------------------------54 Summary of Findings -----------------------------------------------------------54 Conclusions -----------------------------------------------------------------------56 Recommendations ---------------------------------------------------------------57 Suggestions for Further Research----------------------------------------------58

REFERENCES APPENDICES Appendix I Appendix II Kim Letter Questionnaire

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LIST OF TABLES Table 3.1 Target Population ----------------------------------------------------------------------40 Table 3.2 Sample Design -------------------------------------------------------------------------41 Table: 4.1 Response Rate -------------------------------------------------------------------------37 Table 4.2 Age distribution ------------------------------------------------------------------------38 Table 4.3: Gender distribution -------------------------------------------------------------------39 Table 4.4: Educational level ---------------------------------------------------------------------40 Table 4.5 Duration in the role of purchasing in Al-Fatah supermarket -------------------41 Table 4.6 Image of the Locally Manufactured Goods ---------------------------------------42 Table 4.7 Influence of Image to Consumer Demand-----------------------------------------43 Table 4.8: Rate of pricing of locally manufactured goods.---------------------------------44 Table 4.9: Influence of Price Demand of Locally Manufactured Goods----------------45 Table 4.10 Effect of Demand on Locally Manufactured Goods---------------------------46 Table 4.11: Extent to which quality influenced consumers demand-----------------------47 Table 4.12:Rate of Competition of locally manufactured goods----------------------------48 Table 4.13: Effects of Competition of Locally Manufactured Goods---------------------49 Table 4.14: Dealers support of locally manufactured goods.---------------------------------50 Table 4.15: Effects of Dealers Support on Locally Manufactured Goods ------------------51

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LIST OF FIGURES Figure 1.1 Al-Fatah Supermarket Organization Structure-----------------------------------3 Figure 2.6: The Conceptual Framework--------------------------------------------------------31 Figure 3.1 Target Population --------------------------------------------------------------------34 Figure 3.2 Sample Design -----------------------------------------------------------------------35 Figure: 4.1 Response Rate -----------------------------------------------------------------------38 Figure 4.2 Age distribution ----------------------------------------------------------------------39 Figure 4.3: Gender distribution -----------------------------------------------------------------40 Figure 4.4: Educational level -------------------------------------------------------------------41 Figure 4.5 Duration in the role of purchasing in Al-Fatah supermarket ----------------42 Figure 4.6 Image of the Locally Manufactured Goods ------------------------------------43 Figure 4.7 Influence of Image to Consumer Demand---------------------------------------44 Figure 4.8: Rate of pricing of locally manufactured goods.-------------------------------45 Figure 4.9: Influence of Price Demand of Locally Manufactured Goods--------------46 Figure 4.10 Effect of Demand on Locally Manufactured Goods------------------------47 Figure 4.11: Extent to which quality influenced consumers demand-------------------48 Figure 4.12:Rate of Competition of locally manufactured goods-----------------------49 Figure 4.13: Effects of Competition of Locally Manufactured Goods----------------50 Figure 4.14: Dealers support of locally manufactured goods.-----------------------------51 Figure 4.15: Effects of Dealers Support on Locally Manufactured Goods ------------52

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ABBREVIATIONS KAM Kenya Association of Manufacturers VAT Value Added Tax KBL Kenya Breweries Limited EABL East Africa Breweries Limited TV Television Branch Manager

B.MGR

RONGAI A Location/Street In Nakuru And Al-Fatah Branch Named After The Location/Street In Nakuru Town. MFG Mfangano A Street in Nairobi City and Al-Fatah after the Location. HKT Hakati. A Location in Nairobi City and Al-Fatah after the Location. PRN Pioneer. A Building In Nairobi City And Al-Fatah Branch Named After The Building. NKR Nakuru .A Town in Kenya and Al-Fatah Branch Located in Town.

NRB Nairobi. The Capital City Of Kenya And Al-Fatah Branch Located In The City. GSA Garissa Town In Kenya And Al-Fatah Branch Located In The Town.

OPERATIONAL DEFINITION OF TERMS Competition Dealer support An event or contest in which people compete Specialist who matches needs of different market and facilitates dealing between Demand An economic principle that describes a consumers desire and willingness services. Quality improvement Is a formal approach to the analysis of performance and systematic effort to improve it. Perception The act or faculty of apprehending by means of the senses of the mind Personality Its made up the characteristics patterns of thoughts, feelings and behaviors that make a person unique. Occupation An activity that serves as ones regular source of livelihood. to pay a price of specific goods and

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CHAPTER ONE INTRODUCTION OF THE STUDY 1.0 Introduction The introductory chapter covers the foundation information of the study with the details of the background information, statement of the problem, objectives of the study, research questions, and limitations of the study and significance of the study.

1.1 Background of the Study Over the years, the Kenyan manufacturers have continually expressed the lack of support from the local consumers on locally produced goods. Partly this has resulted in the formation of an association of local manufacturers, the Kenya association of manufacturers (KAM) , to counter the declining demand of the local products by the local consumer/buyer.There also has been a very peculiar and even up to this date, an unexplained appetite for alien products by local consumers more than the locally manufactured goods. Daily nation (February 17th, (2009), intimate the local consumer behavior much more clearly. An enduring puzzle has been the almost morbid craze of Kenyan The local manufacturer, big, medium and small has consistently, time and again found her in a turbulent world, an uncertain world, a competitive market environment that has threatened her survival. For the last over two decades now, the local manufacturer has risen above the lines of the press through KAM, in a fierce fight over importation and selling of foreign products whose equivalent was available locally. This fight has been occasioned by the continual decline in the demand thus sales volumes and hence sales revenue of manufacturing entities that were thought to perform well in the early years of monopolies, government controls and protectionism. The Kenyan market is a liberalized market economy, where anyone and any entity is free to trade in any global product, fit for sale and /or consumption, provided all the rules ,law and procedures of trade on such products are followed to the letter. Consequently, the buyer/consumer is free to buy the product of his/her choice on offer from any offerer.
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This kind of economy may prove very competitive to market players / manufacturers in such an economy. It has been of evidence that retails outlets locally stock for sale products, which do not originate from the local production lines and whose equivalent was available locally. Some of the products on the local retails shelves have been found to originate from far across the countrys boundary and find their way into the country through the countrys main entry point. Demands can be defined as the desire for a product or service backed by the ability and willingness to pay a price-equivalent for the products and services. Demand is as old as human desire, need or want. The level of demand for a product or service depends on several factors such as price for the goods, the size of population, price of other goods, income of the consumer, the taste and preference of consumer, as well as the volume and effectiveness of the advertisement among other factors. The word local, with reference to this study was used to mean, Made in Kenya. Made in Kenya consequently was used to mean all those goods whose ideas and consequent manufacture/productions were conceived locally. The background or origin of locally manufactured goods is as old as local trade and thus, dates back to the history of the country of Kenya. 1.2.1 Company Profile Al-Fatah Supermarket limited, being among the one of the leading chains of retail supermarket in Kenya, Opened its doors in the retail trade over 28 years ago(1983) in Nakuru municipality as a single retail shop. Over the years, through accumulation of resources, investing and reinvesting in expansion programs, the firm has managed to grow from a single retail shop to a chain of retail out lets to this date. The firm has 2 retail outlets in Garissa municipality, 6 outlets in Nairobi City and 1 retail outlet in Eldoret town council Al-Fatah supermarket limited had a total workforce of 1500 employees in the nine branches and the Al-Fatah headquarters/central stores and at different levels within its organization structures, Al-Fatah headquarters are located in Nairobi, along Homebody road, off Enterprise road, Industrial Area. The goal of Al-Fatah Supermarket was to be a your friendly supermarket.

Apart from choosing to be a friendly supermarket, the firm is and endeavors to be an Everyday Low on Price Supermarket. This has been and will continue to achieved through the firms endeavor to be a socially responsible organization, both to its employees, customers and the general society at large. It has been evidence that most of the leading retails outlets in Kenya stocked for sale, foreign products whose equivalent was available locally. Al-Fatah mattress supermarket stocked for sale, foodstuffs and other items, which originates from foreign countries and whose equivalent was available locally. Fig 1.1 Organization Structure of Al-Fatah Supermarket Chairman

Director Operation

Director Assets

Director Administration

Director Purchasing

General Manager

Administration manager

Account manager

B.Mgr Rongai NKR

B.Mgr Majic NKR

B.Mgr MFG Nrb

B.Mgr \OTC (Nrb)

B.Mgr HKT Grs

B.Mgr PRN Nrb

B.Mgr ELD Eld

B.Mgr GSA (GSA)

Source; Al-Fatah Supermarket (2012)

1.3 Statement of the Problem It has been observed that more and more local manufacturers were not enjoying the support they used to from the local buyers. This could be traced back beyond the inception of the Kenya Association of manufactures (KAM) in 1958, according to the Kenya Times (December 7th, 1988, History of Kenya Association of manufacturers). According to the daily, one of the reasons to the formation of KAM was to counter the threat posed by locally manufactured goods. Some campaigns that have featured in some local dailies spoke volumes on the above problems. Though the decline in consumer demand of the locally manufactured product could have been affected by imports whose equivalents were available locally, the factors that affected consumer demand of a good were varied. An organizations image could affect the consumer demands for a good. The extent to which organizations image was favorable or unfavorable, could affect or influence to a bigger extent, the consumer preference for a product or services from a manufacturers whose image was as such. The price at which a manufacturer attaches to her offer could also determine how much of her products or services were eventually bought at a given time period. How well a good Mets the need and wants of a consumer, would determine whether the consumer repeat-purchase the same good or not Manufacturers ought to always try and match their product quality with ever-changing needs and wants of consumers. An organizations offer may face competition directly fro other offerer of the same quality or a closer quality to that offer. As well, an offer may face competition from unrelated offers, competing for the same consumer income. Retailers and consumers as well, if not induced to buy a certain good, would only buy what was convenient to them as well as only those product which were made available to them for acquisition. It was appropriate for marketers to go extra mile to ensure that not only were her goods made available or convenient to the buyers, but also to help the buyers in making decisions to buy the same goods. Dealers support could influence how much of a producers goods were bought at a given time prior. This study seeks to find out factors influencing consumers demands of locally manufactured goods in retail outlets.
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1.4 Objectives of The Study 14.1 General Objective The general objective of this study was to investigate the factors that influence consumers demands of locally manufactured products within Al-Fatah Supermarkets.

1.4.2 Specific objectives i. To find out the effect of corporate image on consumer demand in the retail industry in Kenya. ii. To establish the effect pricing on consumer demand in the retail industry in Kenya. iii.To determine effects of product quality on consumer demand in the retail industry in Kenya. iv. To determine effects of competition on consumer demand in the retail industry in Kenya. v. To find out effects of dealer support on consumer demand in the retail industry in

Kenya.

1.5 Research Questions The study sought information to address the following questions. How corporate image does affects the demand in the retail industry in Kenya. i. To what extent does the price at which products were pegged, affects demand in the retail industry in Kenya? ii. How product quality does affects demand in the retail industry in Kenya? iii. To what extent does competition affect demand in the retail industry in Kenya? iv. How does dealer support affects in the retail industry in Kenya?

1.6 Significance of the Study This study aimed at identifying some of the major factors that influenced the demand and sale of locally manufactured goods/ products. The study also sought knowledge on the extent that these factors to be indentified above influence the demand and sale of locally manufactured goods. This study was of benefit to;

1.6.1 The local Manufacturers. This study provided possible solutions to the reasons for decline in demand and sale of locally manufactured goods. The local manufacturer had spent a lot of resources through KAM to fight imported products whose equivalent was available locally This study would be of importance to the local manufacturer as it aimed at providing an insight into the problematic and potential problematic areas where resources could be economically and necessarily utilized.

1.6.2 The managers of the day The study was to act as an eye opener to some of the major areas where the local manufacturers has failed along the course of her operations and such help the same manager of the day improve the current situation.

1.6.3 KAM An association of the local manufacturers, KAM was a beneficially of the final report of this study, as the report could be used by the association to guide its members on the way forward from the current problems.

1.6.4 Top Management of Al-Fatah supermarket This was of benefit to the top management of Al-Fatah supermarket in that the management of the said organization would be enlightened on the role it played in the success of the local economy.

1.6.5 Employees of Al-Fatah Supermarket The employees of supermarket were able to learn through this study that they too had a stake to the success of the local economy.

1.6.6 The Government The study was a source of informed knowledge to the government on the effects imports whose equivalent was available locally has on the local economy .the study might also

act as an influence to the government to provide the local manufacturers with the relevant incentives to be more competitive both in the local as well as the global market.

1.6.7 Other Research in this area So much had not been done and remains to be done in this area. This study provided leads along which such relevant studies could be carried.

1.7 Limitations Of The Study The quality of excepted results to this study in terms of its reliability and validity might be compromised by:

1.7.1 Cooperation The inadequacy of the repaired data as there was guarantee that will anticipate target population and thus the sample from the population chosen, would respond adequately towards the study as there might be correspondents lack of corporation in providing valid and reliable data.

1.8 Scope Of the Study Al-Fatah supermarket is located in Garissa District. Quite a lot could be done to increase the accuracy of the report at the end of this study, however due to the above limitation; it was only possible to delimit this study only to Al-Fatah supermarkets Limited. The assumption here was that the outcome of the research process to be carried out at the said retail outlet applied uniformity and universally to all retail outlets across the board in Kenya.

CHAPTER TWO LITERATURE REVIEW 2.1 Introduction This research study was triggered by a series of campaigns, which appeared on some local dairies initiated by the local manufacturers, through KAM, against imported products whose equivalent was available locally. Reference was made on some of the dailies in furtherance to this study. Past research related to this study was also cited to put in some more weight behind the reason to the carrying out of this study. Related information and resourceful citation will also be visited and reviewed which

helped in the realization of the study. Review of the related literature was avoid the duplication of previous studies, help the researcher to familiarize himself with the area of the study, provide support for major issues in the study, describe what was done to other people in related area, identify gaps in the existing knowledge with regards to this study, and also to help point or suggest other viable areas worth researching on, in relation to this study.

2.2 Theoretical Review

According to Grants (2000) demand was not the same thing as desire or need or want. Grant says that the strength of desire for something not in itself, have any influence on the price of the item. Only when the desire was supported by the ability and willingness to pay the price, did it become effective demand and hence an influence on the market. Effective demands in economies may be defined as the quality of a commodity, which would be demanded at any given price over some period of time. Grants (2000) brought out two types of demand; individual demand and market demand. Individual demand was the relationship between quality demanded of a service by a single individual and the price of that good and service. Market demand was the total demand for good or services i.e. the total quantity demanded by each individual buyer at each price.
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On the other hand, Harvey (1998) defined demand from an economy point, as the desire for something plus the willingness and the ability to pay a certain price in order to possess it. Harvey says that demand was how much of a good people in the market bought at a given price over a certain period of time. Mullearn and Vane (1999) viewed demand from the consumer point with a question, for a particular good or service which factors influence the precise quality demanded by a consumer over a given time period Price came out as the obvious factor , assuming all other influenced upon demand remained unchanged (ceteris paribus assumptions). Thus the higher the price the lower the demand and vice-versa. Harvey (1998) included the price and the conditions of demand (the determinants of demand other than price, a change or shortage, government policy, change in real income, greater equality in the distribution of wealth and a change in the size and the composition of the population). According to Mullearn and Vane (1999), other factors other than price, that influences consumer demand for goods or services were, consumer income, price of other goods and services and preferences or tastes of consumers. Saleemi (1987) defined supply as a commodity, which was offered for the sale at any specific price. Supply was always related to price; Factors of change in supply, Rise or fall in supply occurred due to the change in the following factors; costs of products, climatic situations, improvement in the method of production, peace and security, policy of the government, rate and taxes . At the same time the local manufacturer was

initiating a new policy to encourage the local consumer to buy locally made products. The theme for the campaign was, what Kenya makes and was meant to underline the fact that whenever the local consumer bought locally manufactured products they helped build Kenya. While it was true that the government of the day had a role to play in the success of any organization, it was also, and by large, the sole responsibility of a marketer to keep and above all, to develop her market and market share. Solomon, (2002) notes that the formulation of a policy to encourage local consumer Made in Kenya was in itself a defect in thinking and practice. Instead, a policy to
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encourage local manufacturers to produce what could be acceptable to the local as well as the global consumer could have been viable initiative. Some local consumers were not local per se, thus when producing locally for the local market, manufacturers ought to have in mind that there may be local consumers who may have been exposed to more superior products in some other parts of the globe, which satisfied the same needs as the locally manufactured, but with more user added advantage. This called for policies that sought to ensure that, what was produced locally matched or even exceeded what was produced globally. Ellison, (2009) states that the formulation off policies that sought to encourage

consumers to consume product for the sake of a Common benefit (to build Kenya), in this era of globalization and customization was a primitive venture in marketing. Letting the consumer dictate what she wanted and delivering it to her was the current concept in marketing. William, (2005) argues that it is of common knowledge today that the world has been reduced into global village. In itself, this meant that people were trashing countries just like any other village. The access of information had also been made easier due to improvement and advancement in infrastructure; physical, technological and otherwise. This had not only made it easier for people to move from one corner of the world to another, but also it enabled people to access information just at the touch of a button. Thus no matter what policies the government managed to put in place, to protect any industry from its competitors, the final consumer would eventually access some of that information/material which would eventually raise her level of knowledge. Once consumers got the knowledge that their current needs could be met more satisfactorily for example through the acquisition and use of alternatives products or services, than the current state at which their needs were being met, this in itself was enough to trigger a chain of reaction from the consumers sides which would only come to a stop only when that better alternative had been acquired. Quail (1999) states that as customers, the local business community and the government could be induced to buying only what had been made locally. as earlier seen, government could be relied upon by the local producer, for protection from imports, thus help the
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local producer achieve her objectives, but even so, the critical questions would be; Had the local manufacturer done enough to ensure that the local consumer got value for every coin spend?, or, : Had the local consumer realized the perceived benefits from the local products? Nduati, (Daily nation, February 15th, 2006) Brought out the seriousness of the threat posed by imports on the local product, A three-year campaign by the local manufacturer titled Buy made in Kenya and keep Kenya working was aimed at policy makers and consumers, sensitizing them on the negative effects imports had on the local economy. The success of any manufacturer was at the helm of the final consumer of her products. To what extent a product met consumers need; largely dictate the consumers post purchase behavior towards the product in question. thus no matter the amount spend in any campaign aimed at inducing the local customer/consumer to buy locally made goods, the gap between the expected and the actual performance of a product would determine the viability of such campaign. Philip, (1997) observes that at the fiercest was a war between locally manufactured goods and imported commodities. One of the causes of the battle was the liberalization of import policies. The fight by the local firms was more sophisticated than most of the other campaign on the same (against imports) which were said to has started back along time. The objectives to convince local consumers to buy locally produced gods which were said to belong to the endangered species was to be achieved only if the immense local appetite for alien products was curbed and consumers induced to prefer home grown products instead. There was general attitude by the local consumer that, foreign products, though at times more expensive than the local other, were of higher quality. The reality though was that the quality aspect of the foreign product in comparison to the locally made product was debatable. Insufficient local demand for locally made products was cited as one of the reasons for under-utilization of the industries, which were said to be operating at between 60% and 70% capacity. William, (2005) notes that consumer attitude towards products had been brought to our attention. Indeed one of the basic factors to consumer attitude towards a product. Consumer attitude towards a product was determined by several factors. A major factor
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was the image that consumer held in the offered of the product. This might be the producer of the product or the seller of the same product. a manufacturer should always make sure that the corporate image and the image created by the product, as well as the image of the channels handling the product remained favorable as this ultimately influenced on the attitude of the consumer towards the product and hence the final destiny of the organization at large. According to Opala (Daily nation, October 16th, 1994), Kenyan manufacturers complained that foreign goods were being dumped locally due to inadequate tariff protection, which exposed local industries to unfair competition.Lack of protection as well as duties on raw materials, and finished goods were cited as factors that render locally made products expensive and uncompetitive. Here the government was criticized, especially due to poor liberalization arrangement and relaxing exchange controls, which resulted in unfair competition and dumping. Inconsistent investment policies, which were usually implemented in stop-gap fashion and at times reversed before taking effect, will also be cited as additional reasons to poor performance of local products in the local market.

2.2.1 Corporate Image According to Jerkins and Yadin (2004), there are several kinds of images; this was the image that the people in the organization, especially its leaders, believed to be impression outsiders had of the organization. This could be an illusion bred on wishful thinking because knowledge and understanding of the outside opinion was lacking. It was a common situation based on Everybody loves us fantasies. Robinson (1999) argues that the image held by people outside the organization, and it might be based on experience or poor information and understanding. Current image depends on how little or how much people knew and in a busy world their organization. This was the desired image, the one management wished to achieve. It was however not so much favorable or proffered image as a true one. Wish image applied to something new when outsiders were as yet uninformed. Here we have the image of the organization
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itself rather than of the product or services. Corporate image might be made of many things such as the company history, financial success and stability, quality of production, export success, industrial relations and reputation as an employer, social responsibility and research record. A number of individuals, branches or other representation can each create a particular image, which did not conform to a uniform image for the total organization. There could be many images as there are, say sales staffs.

2.2.2 Price According to Kotler and Armstrong (1996), price could be defined as the amount charged for a product or service or the sum of value that consumers exchanged for the benefit of having or using the product. Historically, price has been the major factor affecting buyer choice. In recent decades however, non-pricing factors have become more important in buyer-choice behavior. Lundgren, (1996) notes that consumer perception of price and value, Consumer would decide whether a product price was right. When setting price, companies ought to consider consumer perception of price as well as how these perception affected consumers buying decisions. Pricing decisions like other marketing mix decisions ought to be consumer oriented. Consumers will exchange value (price) to get value (the benefit of having or using the product). Effective buyer-oriented pricing involved understanding how much value consumers placed on the benefit they received from the product and setting prices that was fit for that value. Market demand- where costs did set the lower limit of price, the market and demand did set the upper limit. Both consumer and the industrial buyers balanced the price of a product against the benefit of owning it. Thus before setting the price, marketers ought to understand the relationship between price and demand for their product. Lind, (2003) states that competitors cost, price and offers, Competitors costs, prices and possible competitors reaction to the companys own price moves also affected the companys price and value against the price and value of a comparable product made by other competitors. In addition the company followed a high price, high-margin strategy, it
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might attract competition. A low price, low margin strategy, however might stop competitors or even drive them out of the market. Company needed also to benchmark its costs against its competitors costs to learn whether it was operating at a cost advantage or disadvantage. It also needs to learn the price and quality of each competitors offer. Leslie, (2007) notes that once a company was aware of competitors price and offers, it could use them as a starting point for its own pricing. If a companys product was similar to that of that of the competitor, then prices ought to be set close to that of the competitors and vise versa. Basically a company should use price to position its offer relative to that of the competition. Lynch, (2000) observes that when setting prices, a company ought to also consider other factors in external environment such as; Economic conditions. These have strong impact on the firms pricing strategies. Economic factors e.g. Boom, recession, inflation and interest rates affected pricing decision because they affected both the cost of producing the product and consumer perception of the products price and value, Resellers. How would resellers react to various prices? A company ought to set prices that gave resellers fair profit, encourage their support, and helped them to sell the product effectively, Social concerns. In setting prices, a company short term sales, market share and profit goals might have tampered or affected by broader societal considerations, Government. This is another external factor affecting pricing.

2.2.3 Product Quality According to Armstrong, (2006) product was anything that could be offered to the market for attention, acquisition, use or consumption that might satisfy a want or a need. Products included physical objects, services, persons, places, organization and ideas, Product quality was the ability of a product to perform its function; it will include product overall durability, reliability, precision, ease of operation and repair and other valued attributes. Although some of these attributes could be measured objectively from a marketing point of view, quality ought to be measured in terms of buyers perceptions.

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Juran (1999) notes that , one of the qualities of Gurus, reaching an arrangement on what was meant by quality is not simple. Juran defined quality as fitness for use. One leadership for quality, Juran brought out two subsidiary definitions for quality, which helped reduce the confusion by the word quality; Quality meant product features that meet customer needs, According to Juran, high quality enabled companies to; increase customer satisfaction, make product salable, meet competition, increase market share, provide sales income and secure premium prices. According to this definition, the effect of quality was on sales. Quality means freedom from deficiencies. Juran said that higher quality enabled companies to; reduce error, reduce rework and wastes, reduce field failure and warranties, reduce inspection and test performance. According to this definition, major effect of quality was on costs. Juran (1999) defined product as the output of any process. Product consisted mainly of goods, software and service. Product features was a property possessed by a product and what was intended to meet certain customers needs and thereby provide satisfaction. A customer was anyone who received or was affected by a product or process. Customer might be internal to the Organization or external to the organization. Alphert, (1999) states that product satisfaction and customer satisfaction; Product satisfaction was a result achieved when a product features responded to customers need. It was synonymous with customer satisfaction. Product satisfaction was stimulus to product salability. The major impact was on income, Products deficiencies were a product failure that resulted in product dissatisfaction. Product deficiencies took such forms as power outrages, failure to meet delivery dates, inoperable goods, blemished appearance and nonconformance to satisfaction. According to Ajzenicet (2005), Product satisfaction and product dissatisfaction were not opposite, Product satisfaction had its origin in product features and was why clients buy the product. Product dissatisfaction had its origin in nonconformance and was why customers complain. There were many products that gave little or no dissatisfaction; the product did what the supplier said they would do. Yet the products were not salable because some competing product provided greater product satisfaction.

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According to Juran, (1999), managing for quality was done by use of three managerial process of planning control and improvement, Quality planning; this was creativity of developing the product and processes required to meet customers needs. It involves to Determine who the customers, the need of the customers, develop features that responded to the customer needs ,develop processes that were able to produce those product features, transfer the resulting plans to operating forces, quality control; This process consists of the following steps, Evaluate actual quality performance, Compare actual performance to quality goals. Ailawadi (2001) states that quality improvements: This process was the means of raising quality performance to unprecedented levels (breakthrough). The methodology consisted of a series of universal steps which include; establish the infrastructures needed to secure annual quality improvement, Identify the specific needs for improvement-the improvement project, For each project establish a project team with a clear responsibility for bringing the project to a successful conclusion, Provide the resources, motivation and training needed by the team; dialogue the cause, stimulate establishment of a remedy, establish controls to hold the gains. Garvin (1988) Pointed out five approaches to defining quality; the transcendent; product based; user based; manufacturing base and value-based, Transcendent., Quality was neither mind nor matter; it was a conduction of excellence implying fine quality as distinct from poor quality. Quality, Quality was achieving or reaching for highest standards as against being satisfied with sloppy and fraudulent Product based, Difference in quality amounted to difference in the qualities of some desired ingredients or attributes User-based,Quality consisted of the capacity to satisfy wants the quality of a product depended on how well it fitted the pattern of consumer preference Quality was fitness for use. Manufacturer based. Quality meant conformance to requirement quality was the degree to which a specific product conformed to a design or specification. Value added. Quality was the degree of excellence at an acceptable price and controls of variability at an acceptable cost quality means the best for certain conditions. These conditions were; (a) The actual use and (b) The selling price of the product
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Garvin (1988), pointed out eight dimensions or categories of quality (product quality) that had been identified; performance, features, reliability, conformance, durability, serviceability, aesthetic and perceived quality. These dimensions allowed for multiple strategies in the approach to quality management. According to Garvin (1988), for quality to be more than a passing interest to managers, it ought to have a demonstrable impact on the bottom line. It ought to be closely associated to such key measures of business performance as price, advertising, productivity, cost, market share and profitability.

2.2.4 Competition According to Bearden, (2006), competition will led to poor performance or decrease in demand of locally made products in the local market. The increase in competition was attributed to dumping, inadequate tariff protection, duties on raw-materials and finished goods, poor liberalization arrangements and exchange controls, as well as inconsistent investing policies. Though increase in competition led to a decrease in demand of certain products, the unwillingness and the inability of organization to proactively respond to competition, pushed organizations to the edge and eventually saw their exit from the market. Organizations in the world ought to have started bracing themselves to competition for this was ultimately inevitable at one point in organizations life. Otieno (Daily nation April 15th 2011) The collapse of some local industries, textile industries being an example, could not solely be blamed on liberalization of local economy, but also due to the illegal imports and dumping of subsidized and substandard foreign goods in the local market. textile fabrics and ready-made garments brought into the local market without payment of import duties, value added tax(VAT) and other government taxes comprised the level playing field for the local textile and garment industry in Kenya. Other factors apart from liberalization was cited as reasons for the collapse of the local industries, illegal imports and dumping of subsidized and substandard foreign goods. A research carried out by KAM found a decline in the number

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of local industries. This was associated with unbalanced competition caused by liberalization .Less costly imports had taken up the local markets share. Becket (2000) notes that, while it agreeable that unfair and unbalanced competition could see the exit of an organization from the market, there are existed strategies to a proactive organizations, which could be used to counter unfair and unbalanced competition among other threats that organizations faced in the market place. A company that had a will to keep its market and market share as well as developing the same, would go at any length to keep its market and market share. The decline in the number of local industries therefore could be attributed to the failure of the affected industries, to formulate as well as employ winning strategies aimed at countering their external threats and being smart in their operation as well. According to daily nation reporter (daily nation may 14th 2002) the local manufacturer had continuously sought to have all imports whose equivalent was available locally Banned to protect the local industry. The local manufacturer wanted a five year ban on importation of textile products to revive the local industry. The local textile industry, the reasons cited for death of the textile industry were the dumping of textile products and high electricity tariffs. he brought to our attention that, not only had some of the local textile industries closed down, but also that some others had relocated to other countries, It was possible for the organizations in a situation like the local manufacturers to reclaim their lost market share. Some cases of general knowledge and observation could be cited that, Taking the case of the beer industry as an example ,Kenya breweries limited (KLB) was under intense threat of losing a big chuck of its local market share to some local and foreign products and organizations ,however ,through intensive marketing ,where price reviews were done to reflect the current economic and competitive conditions ,a review of product quality and distribution system intensive promotions ,use of state of the art technology in its production lines, restricting to cut down on its total production /operational costs ,and consequently changing its name (image)to east Africa breweries limited.(EABL) to reflect a regional organization among other strategies, the said

organization managed to shake off some of its major competitors to reclaim part of its lost market share.
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Another case should be that of shoes industry. Bata Shoes Company some years back was on the verge of collapsing due to intense competition from the second hand shoes imports. Bata Shoe Company however managed to reclaim back part of its lost market share primarily through quality improvement; price cuts as well as increased promotion among others. Given that the same situations (dumping and electricity tariffs among others) were being faced by the organizations in the above cases( a &b), the question would be ;while some organization have managed to fight off competition from imports, where have the other organizations gone wrong in their management and operations?

2.2.5 Dealers Support According to Bernstein, (2009) , today, understanding customers was not enough. Under the marketing concept, companies gained competitive advantage by designing offers that satisfied target consumers needs better than competitors offers. Organization delivered more customers value by offering to customers lower prices for similar products and services or by proving more benefits that justified higher prices. Thus marketing strategies ought to consider not only the need of the target consumers, but also strategies of competitors. The first steps was competitors analysis, the process of identifying and assessing key competitors. The second stage was to develop competitive marketing strategies that strongly positioned the companies against the competitors and give it greatest possible competitive advantages. Bailey (1999) states that to plan effective competitive marketing strategies, a company needed to find out all it can about its competitors. It ought to constantly compare its product, prices, channels and promotions with those of close competitors, to find out areas of competitive advantages and disadvantage. And it could launch a more effective marketing campaign against its competitors and prepare strong defenses against competitors actions. Companies needed to know, their competitors, competitors objectives, competitors strategies, competitors strength and weakness, competitors reaction patterns. The competitor, a company could define competitors as companies offering similar products or services to the same customers at similar prices. Broadly, a
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company might define competitors as all firms making the same product or class of products. More broadly, competitors might include all companies making products that supply the same service. Still more broadly, competitors might include all companies that compete for the same customer shilling. Boyd et.al (1990) argues that companies ought to avoid;competitor myopia A company was more likely to be buried by their latent competitors than its current ones. For example a film-making company might work about the growing competition from film makers, but in actual sense if faced much greater threat from companies that had advanced in the film camera technology where the cameras took video still pictures that could be shown on a TV set, turned into hard copy and later erased. What a greater threat was there to a film business than a filmless camera? Companies could identify competitors from industry point of view or market point of view. Bailey (1999) notes that the questions to marketers could be, what did each competitor seek in the market place? or what drove each competitors behavior? some companies might be oriented towards satisfying rather than maximizing profits. They have target profit, goal and were satisfied in achieving them, even if more profit could have been produced by other strategies. Marketers ought to look beyond competitors profit goals into competitors mix of objectives with different importance. Indentifying competitors strategies- the more the ones firms strategies resembled another firms strategy, the more the two companies competed. Companies need to look at all the dimension those strategic groups (groups in a firm in an industry following the same or similar strategy within the industry. They need to know each competitors products quality. Features and mix, customers services, pricing policy, distribution coverage: sales force strategies, and advertising and sales promotion programs. They must study the details of each competitors research and development, manufacturing, purchasing, financial and other strategies. Braikie , (2003) states that assessing competitors strengths and weaknesses .marketers need to carefully asses each competitors strength and weaknesses, in order to answer critical questions such as what can our competitors do? Companies ought to gather data on each competitors goals, strategies and performance over the last few years. This will
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help among other things. Benchmarking, in other industries to find ways to improve quality and performance. Benchmarking has become an important tool for increasing a companys competiveness. Armstrong, (2006) notes that estimating competitors reactions, companies would want to know what their competitors would do. Competitors objectives, strategies, strengths and weaknesses go along way explaining their likely actions .as well as likely reactions on companys move such as price cuts, promotion increase or new product introduction. Marketing managers need to deeply understand a given competitors mentally if they wanted to anticipate how the competitor would act or react. After identifying and evaluating major competitors, a company should design broad competition strategies that best positioned its offer against competitors offers and give the company the strongest possible competitive advantage. No one strategy was best for all companies, thus each ought to determine which made the most sense given their position in the industry and its objectives opportunities and resources. According to Porter (2008), competition was at the core of success or failure of firms. Competition determined the appropriateness of a firms activities that could contribute to its performance, such as innovations, or cohesion culture or good implementation. Comprehensive strategy was the search for a favorable competitive position in an

industry, the fundamental arena in which competition occurred. Competitive strategy aimed at establishing and sustainable position against to focus that determined industry competition. Porter (2008) intimated that first fundamental determinant of a firms profitability were industry attractiveness. Competition strategy should grow out of a sophisticated understanding of the rules of competition that determined an industrys attractiveness. The ultimate aim of competitive strategy was to cope with and, ideally, to change those rules in the firms favors. In any industry, whether domestic or international or produces a product or services, the rules of competition were embodied in five competitive forces which are indicated as the entry of a new competition, the threat of substitutes, the bargaining power of buyers, The Bargaining power of suppliers, t he rivalry among the existing competitors. The collectiveness strength of the above five competitive forces
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determines the ability of the firm in an industry to earn, on average , rates of return on investments in excess of capital. The five forces determined industry profitability because they influenced the prices, cost and required investments of firms in an industry. Porter (2008) argues that buyer power influenced the prices that firms could change, as did the threat of substitution. The power of buyers could also influence the cost and investments, because powerful buyers demand costly services. The bargaining power of supplies determines the costs of raw materials and other inputs. The intensity of rivalry, influenced prices as well as the cost of competing in areas such as plant product development, advertising and sales force. The threat of entry places a limit on prices and shapes the investments required to deter entrants. Porter suggested some generic

competitive strategies. These included. Overall cost leadership- were companies worked hard to achieve lowest cost of production and distribution so that they could price lower than their competitors and win a large market share. Differentiation- were companies concentrated on creating highly differentiated product line and market programs so that they could come across as the class leaders in the industry. Focus- were companies focused their efforts on serving a few segments well rather than going after the whole market. Operation excellence- Companies provided superior value by leading their industry in price and convenience. They work to reduce cost, create a lean and efficient value delivery system. They serve customers who want reliable, good quality products/services, but who want them cheaply and easily. Garvin, (2002) notes that, while trying to expend total size, the leading firm also ought to protect its current business against competitors attack. Market leaders should prevent or fix weakness that provides opportunities for competitors. They need to keep their prices in line with value the customers saw in their brand. Best defense was a good offense and the best response was continuously innovation. The leaders refused to be content with the way things were and led the industry in new products, customer service, distribution effectiveness and value to customers. The leaders took the offensive, set the pace and exploit competitors weakness. Position defense - This involves the defense of a fortified position. This tends to be a weak defense because you become a sitting duck. It can lead to a siege situation in which time is on the side of the attacker, that is, as time goes
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by the defender gets weaker, while the attacker gets stronger, Flank position - This involves the re-deployment of your resources to deter a flanking attack. You protect against potential loss of market share in a segment, by strengthening your competitive position in this segment with new products and other tactics. According to Garvin, (2002) ,Preemptive defense- striking competitors aggressively before they could move against the company, Mobile defense - This involves constantly shifting resources and developing new strategies and tactics. A mobile defense is intended to create a moving target that is hard to successfully attack, while simultaneously, equipping the defender with a flexible response mechanism should an attack occur. Counter offensive - This involves countering an attack with an offense of your own. If you are attacked, retaliate with an attack on the aggressors weakest point, Contraction defense- strategy used by leaders if they found that their resources were spread too thin and competitors were nibbling away on some fronts. Jeikiu and yadin(2000) argues that, whether a company was a market leader, challenger, follower or niche, it ought to watch its competitors closely and find the competitive strategy that positioned it most effectively. And it ought to continuously adapt its strategies to the fast-changing competitive environment. Whoever, a company could spend too much time and energy, tracking competitors, while damaging its customers orientation and customers focus. Dealer (marketing channel) referred to a set of interdependent organization involved in the process of making a product available for use or consumption by the consumer or business buyer. The reasons for using marketing intermediaries were that. Ajzenicet, (2005) notes that, intermediaries had greater efficiency in making goods available to the target market. Though their contacts, experience, specialization and scale of operation, intermediaries usually offered the firm more than it could achieve on its own, Intermediaries reduced the amount of work that should have been done by both the producers and consumers, as opposed to the use of direct marketing. Fro economic systems point of view, the role of intermediaries was to transform the assortment of products made by producers into assortment of products wanted by consumers, and In the distribution channel, intermediaries bought large quantities of many producers and
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broke them down into smaller quantities and broader assortment wanted by consumers. Thus intermediaries played important role in matching supply and demands. Once a company had reviewed its channel alternatives and decided on the best channel design, it ought to implement and manage the chosen channel. Channel management called for the selection and motivation of individual channel members and evaluation of their performance over time. Robinson (1999) notes that once selected, channel members ought to be continuously motivated to do their best. Companies must not only sell through the intermediary, but to them. Most producers saw the problem as finding ways to gain Intermediary Corporation. They used the carrot-and-stick approach. At times, they offered positive motivators such as high margins, special deals, premiums, cooperation advertising allowance, display allowances and sale volume. At times, they used negatives motivators such as threatening to reduce margin, to slow down delivery, or to end the relationship all together. Most advanced companies try to forge a long-term partnership with their distributors. This involved building a planned professionally managed, vertical marketing system that meets the needs of both the manufacturers and the distributors. E.g. Jointly planning merchandising goals and strategies, inventory, levels and advertising and promotion plans, as well as helping the channel to be successful in selling the companys products. According to Bennet, (2006), Producers ought to regularly check each channel member performance against standards, such as sales quotas, average inventory levels, customers delivery times, and treatment of damaged and lost goods, cooperation in company promotion and training programs and service to the customers. The company should recognize and reward the intermediaries who perform well. Those who perform poor should be helped. Manufacturers also needed to be sensitive to their dealers and not treat them lightly, for manufacturers may risk losing dealers support, if they treated their dealers as such.

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2.3 Critical Review In his research on the factors that led to low market share of detergent (Omo) within the manufacturing industry in Kenya, Kinuthia (June 200) found out some factors that effect market share of the said product; poor government policies, stiff competition, poor marketing strategies, technology , social-cultural factors, declining purchasing power, age of consumers, consumer occupation. Obengele (November 2002) found out several factors that led to poor sales performance in the performance in the print media as; poor products quality, poor staffs training, competition, tribal and political interference and liberalization. Some factors sales and marketing of cigarette at Mastermind Tobacco Kenya Limited as ; stiff competition, high prices, poor quality, ineffective distribution strategies. According to Kotler and Armstrong (2006), Consumers made many buying decision every day. Organization researched consumer buying decision in great detail to answer questions about what consumers bought, when they bought and why they bought. Marketer could study customer purchase to find answers to questions about what they bought, where and how much. The central questions for the marketers was, how did customers respond to various marketing efforts that companies used?. The company that really understood how consumer responded to different products features, prices and advertising appeals had a greater advantage over its competitors. Marketing stimuli consists of four ps; price, place, product and promotion. Other stimuli include major forces and events in the buyers environment; economic, technological, political and cultural. All these inputs enter the buyers black box, where the are turned into a set of observable buyer responses; product choice, brand choice, dealers choice, purchase timing and purchase amount. Marketers want to understand how stimuli were changed into responses inside the consumers black box, which had two parts. First, the buyers characteristic influences how he/she perceived and reacted to stimuli, second, the buyer decision process itself affect buyers behavior.

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2.4 Summary of Gap to be Filled by the Study Consumers purchases are influenced strongly by cultural, social, personal and psychological characteristics. For most parts, marketers cannot control such factors, but they must take them into account. Culture is the main cause of a persons want and behavior. Human behaviors is largely learned growing up in a society, a child learns basic values, perceptions and wants and behaviors from the family and other important institutions. Every group or societys culture and cultural influences in buying behavior varied greatly from country to country. Failure to adjust to these differences could result in ineffective marketing or embarrassing mistakes. Marketers were always trying to sport cultural shifts in order to discover new products they may be wanted, Sub-culture- each institute contained small sub-cultures or group of people with shared values system based on common life experience and situations. Social class- almost every society had some form of a social class structure. Social classes were societys relative permanent and ordered divisions whose members shared similar values, interests and behaviors. Social class was not determined by a single factor, such as income, but was a measure of a combination of occupation, income, wealth and other variables; Marketers ought to have interest in social class because people within a given social class tended to exhibit similar buying behavior. Consumers behavior was also influenced by the social factors such as consumers small groups, family and social roles and status, Group -Many small groups influenced a persons behavior. Examples of such groups were membership groups and reference groups. Manufacturers of a products and brands subjects to strong group influence should figure out how to reach opinion leaders in relevant groups. Family- family members could strongly influence buyer behavior. Family was the most important consumer buying organization in the society. Marketers should be interested in roles and influences of the husbands, wife and children on the purchase of different products or services. Role and status- A person belongs to many groups-family, clubs, organization etc. The persons position in each group could be defined in terns of both
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role and status. Each status reflected the general esteem given to it by the society. People often chose products that reflected/showed their status in society. Buyers decision were also influenced by personal characteristics, such as buyers age, and life-cycle stage, occupation, economic situations, lifestyle and personality and self concept. Age and life cycle stage- People change their goods and services they bought over their lifetime. Buying was also shaped by the stage of the family life cycle. Occupation- persons occupation affected the goods and services bought; Economic situation- A persons economic situation affected product choice. Marketers of income sensitive goods watched trends in personal income, savings and interest rates. If for example economic indicator as pointed at recession, marketers took steps to design, reposition and re price their product closely. Lifestyle; People coming from the same subculture, social class and occupation, may have different lifestyles. It was a persons pattern of living as expressed in his/her psychographics. It involves measuring consumers major AIO dimensions; i.e. activity (work, shopping, sports, social events), interests, (food, fashion, family, recreation) and Opinion (about themselves, social issues, business products). Personality-Personality changes from person to person, time to time and place to place. Therefore it can greatly influence the buying behavior of customers. Actually, Personality is not what one wears; rather it is the totality of behavior of a man in different circumstances. It has different characteristics such as: dominance, aggressiveness, selfconfidence etc which can be useful to determine the consumer behavior for particular product or service. A persons buying choices were further influenced by four major psychological factors; motivation, perception, learning, beliefs and attitude, People had many needs at a given time. Some were biological arising from the state of tension such as hunger, thirst or discomfort. Others were psychological, arising from the needs of recognition, esteem or belonging. Most of the needs may not be strong enough to motivate the person to act at a given point in time. A need became a motive once it was aroused to sufficient level of
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intensity. A motive (or drive) was a need that was sufficiently pressing to direct the person to seek satisfaction. needs. A person tried to satisfy the most important needs first. Once the need was satisfied, it stopped being a motivator and the person tried to satisfy the next important need. A motivated person was ready to act. How the person acted was influenced by his or her perception of the situation. Two people with the same motivation and in the same situation acted quite differently because they perceived the situation differently. The reason as to why two people perceived the same situation differently was that all of them learnt by the flow of information through the five senses; sight, hearing, touch, smell and tastes. However, each person receives, organizes and interprets this sensory information in an individual way. Perception was a process by which people selected organized and interpreted information to form meaningful pictures of the world.

People formed different perception of the same stimulus because of three perceptual process; Selective attention, selective distortion and selective retention. People were exposed to a great amount of stimuli every day, for example several products or advertisements each single day. It was impossible for a person to pay attention to all these stimuli. Selective attention was the tendency for people to screen pout most of the information to which they were exposed- which meant that marketers had to work especially hard top attract the customers attention. Their message got lost on most people who were not in the market of the product, or even people who were in the market might not notice the message or the product unless it stood out from the surrounding sea of other products or messages. even noted stimuli did not always come across in the intended way. Selective distortion-is a term that refers to the tendency of people to interpret information in a way that will support what they already believe. For example , consumer may hear marketers praise their product, but because they had a strong learning towards particular
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product from particular manufacturer (for example foreign manufacturer) the consumer may distorted those marketing gimmicks or point on order to conclude that foreign product were good. Selective Retention: People forget much of the stimuli which they receive and only retain that information which reinforces their values and decision. You are more likely to remember the positive features of brand pressure cooker since they help reassure you that the decision which you had made was correct. Because of selective exposure, distortion and retention, marketers have to work hard to get their message through. Once people act they learn. Learning describes changes in individuals behaviors arising from experience. Drives became motives once they were directed towards a particular stimulus object/product. A response to the idea of buying a product for example was conditioning by the surroundings cues. Cues were minor stimuli that determined when, where and how the person responded. Through doing and learning, people acquire beliefs and attitudes. These in turn influences the buying behaviors. A belief was a descriptive thought that a person had about something. For example, a person might believe that a product was of a superior quality and symbolized a certain social status. These beliefs may have been based on real knowledge, opinion or faith and might not carry an emotional charge. Marketers ought to be interested in beliefs that people formulated about specific products and services, because these beliefs made up product and brands images that affected buying behaviors. Should some of the beliefs be wrong and prevent purchase, the marketer ought to launch a campaign to correct them. People have attitude regarding religion, politics, clothes, music, food and almost everything else. An attitude described a persons relative consistent evaluations, feeling and tendencies towards an object or idea. Attitude did put people into a frame of mind of liking or disliking things or moving towards or away from them. For example, someone might hold attitude as ; Japanese make the best products in the world. Then if the attitude of those people were, buy the best, then their favorite would be Japanese products.

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Modern marketing called for more than just developing a good product, pricing it attractively and making it available to the target customers. Companies ought to also communicate with their customers, and what they communicated ought not to be left to chance. Modern companies managed a complex marketing communication system. Companies communicated with their middlemen, consumer and various publics. In turn, the middlemen communicated with their consumers and various publics. Consumers had a word-of-mouth communication with other and with other publics. Meanwhile, each group provided feedback to each other. Communication goes beyond the specific promotion tools. The product design, its price, the shape and color of its packages, and the store that sell it-all communicated something to the buyer. Thus although the promotion mix was the companys primary communication activity, the entire marketing mix, product, price, promotion and place, should be coordinated for greatest communication impact. Promotion mix- These were a companys total marketing communications program that consisted of the specific blend of advertising , personal selling , sales promotion, personal selling and public relations tools that the company used to pursue its advertising and marketing objectives. Though several related studies have been carried out previously, none of them focused on the major market players (retailers) on this topic. Retailers held a very important key to the success of a manufacturer, hence the study. this study was triggered by the increased challenges that were faced by the local manufacturers, challenges of which had been posed by foreign products whos equivalent was available locally . Thus this study hoped to provide some light as to the reason for the decrease in demand form the locally manufactured products as well as some critical steps to ease the problem.

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2.5. CONCEPTUAL FRAMEWORK The conceptual framework below serves as a simplification to the undertaking of the relationship between the independent and the dependent variables. Figure 2.1 The Conceptual framework. Independent Variable Dependent Variable

Corporate Image Pricing Consumer demand Product Quality Influence/Effect Of locally manufactured products

Competition Dealer support Source; Author (2012) Interpretation of Variables 2.5.1 Corporate image

Corporate image or reputation describes the manner in which a company, its activities and its products or services are perceived by outsiders. In a competitive business climate, many businesses actively work to create and communicate a positive image to their customers, shareholders, financial community and the general public.

2.5.2

Pricing

According to Bernstern Jerold (2009) Pricing is the process of determining what a company will receive in exchange for its products. Therefore the fair the price consumer will create a good perception towards a product hence they will tend to have a behavior or tendency of going for the product.
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2.5.3

Product Quality

Product quality was the ability of a product to perform its function; it will include product overall durability, reliability, precision, ease of operation and repair and other valued attributes. Although some of these attributes could be measured objectively from a marketing point of view, quality ought to be measured in terms of buyers perceptions.

2.5.4

Competition

The competitor, a company could define competitors as companies offering similar products or services to the same customers at similar prices. Broadly, a company might define competitors as all firms making the same product or class of products. More broadly, competitors might include all companies making products that supply the same service. Still more broadly, competitors might include all companies that compete for the same customer shilling.

2.5.5

Dealer Support

Organization delivered more customers value by offering to customers lower prices for similar products and services or by proving more benefits that justified higher prices. Thus marketing strategies ought to consider not only the need of the target consumers, but also strategies of competitors. The first steps was competitors analysis, the process of identifying and assessing key competitors. The second stage was to develop competitive marketing strategies that strongly positioned the companies against the competitors and give it greatest possible competitive advantages.

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CHAPTER THREE RESEARCH DESIGN AND METHODOLOGY 3.1 Introduction This chapter seeks to analyze the research design, target population, sample design, data collection instruments and procedures, data analysis procedure and validity of research.

3.2 Research design The design of the study was a descriptive research. Kerlinger (1969) pointed out that descriptive studies are not only fact-finding but may often result to in the formulation of the important principles of knowledge and solutions to significant problems. Descriptive designs were more than just a collection of data since they involve measurements, classification, analysis and interpretation.

3.3 Target Population In the course of the field investigations, the target population was obtained from the various levels, departments and section within Al-Fatah supermarket, where significance purchasing decisions was undertaken. There was selected levels ,department and titles along which purchasing decisions were being carried out in Al-Fatah supermarket .each of those departments ,levels or titles had a number of subjects responsible for making purchasing decisions .the target population was only chosen from the titles /characteristics responsible for making significance purchasing decisions within Al-Fatah supermarkets. In this regard, the targeted population was obtained from the six branches operated in and within Garissa and the Al -Fatah head officers located at Garissa area.

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Table 3.1 Target population Population characteristics Directors Purchasing managers Branch managers Supervisors Section heads Totals Source: Author (2012) 3.4 Sampling Design To answer the research question and the direct the research efforts towards achieving the research objectives, it was possible to go to the census way, due to the restriction of time, money and access to the population elements. Data from sample rather than the possible cases was considered, to make generalization about all the cases from which the sample was selected. A combination of stratified sampling techniques and probability sampling was used to obtain a representative sample from the target population. Through the identification and use of the different strata along the line of purchase decision-making at Al-Fatah supermarket, desire representative sample from the target population was obtained by ensuring that the existing subgroups were more of less reproduced in the sample. Purposive sampling and quota sampling of non probability was used .purposive sampling was used to obtain only those subjects who are felt to have their required information in respect to the objective of the study a combination of quota sampling and convenience sampling was used to obtain the various subgroups or quotas in the target population based on convenience and accessibility of subjects. Frequency 4 2 9 18 45 78 Percentage 5 3 12 23 58 100

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Table 3.4.1; Sample design Population characteristics Directors Purchasing managers Branch managers Supervisors Section heads Total 4 2 9 18 45 78 2 2 6 12 18 40 5 5 15 30 45 100 Frequency Sample Percentage

Source: Author (2012) 3.5. Data Collection methods and Instruments 3.5.1 Instruments Self administered questionnaire was used in the research of relevant data to support the researchers objectives and answer the research questions ,through the questionnaires, the subjects were asked questions and was given time to fill the questionnaire by their own and to best of their knowledge. Structured and unstructured questions was used to solicit for the required data.At the initial stages the researcher walked into Al-Fatah retail outlets to establish whether the retail chain is stock for retail, imported products whose equivalent was available at the locally. This was the motivational point to the research study information was obtained at the initial and successive stages, from, print media as well as from reliable books To enable the researcher proceed with the study, a letter of introduction was obtained from Kenya Institute of Management. Questionnaires were

prepared and the management of al-Fatah supermarket approached to allow the researcher carried out the study in the said institution. Permission was granted and employees of al-Fatah was approached individually and explanations given to them about the objectives of the questionnaires. The subject was assured of confidentiality of their feedback. Other procedures to be used were piloting, revision of the instruments and filed

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work. The revised questionnaire was distributed to the subjects and later to be retrieved for analysis. 3.6 Data Analysis methods and procedures. Data presentation and analysis involved the use of descriptive statistics to summaries data and describe the sample. This involved the use of tables which enabled the researcher to have a better interpretation of the subjects response thereby enabling the researcher to meet the study objectives and answered the research questions. It was to interpret the data that was reflected on table.

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CHAPTER FOUR DATA ANALYSIS, PRESENTATION AND INTERPRETATION OF FINDINGS 4.1 Introduction This chapter covers research findings from the case study. Data analysis and information was collected using questionnaires, interviews and observation. The data has been presented mainly by tables, graphs and pie charts then analyzed and interpreted under headings.

4.2 Presentation of Findings The study targeted a sample of 40 employees in Al-Fatah supermarket limited. However the response rate in the duration of data collection and retrieval was a total of 30 respondents .in other words 75% of the targeted representative sample completed the questionnaire and handed back the same to the researcher. 75% response rate was enough and adequate responses to warrant a reliable Information. 4.2 .1 Response Rate Table: 4.1 Response Rate Questionnaires Distributed Returned Not returned Total Source: Author (2012) Frequency 30 10 40 Percentage % 75 25 100

37

Figure: 4.1 Response Rate

00

25%

Key
Returned Not Returned

75%

Source: Author (2012) Table 4.1 and figure 4.1 shows that 40 questionnaires were sent to 40 respondents of which 75% answered and returned the questionnaires to the researcher. The 25% non respondents were those which were incomplete or inconsistence. 4.2.2 Response According to Age distribution Table 4.2 Age distribution Age bracket 21-25 years 26-30Years 31-35 years 36-40years Over 40 years Total Source: Author (2012) Frequency 6 10 8 4 2 30 Percentages 20 33 27 13 7 100

38

Figure 4.2 Age distribution

35% 30% 25% Percentage 20% 15% 10% 5% 0% 21-25 years 26-30Years 31-35 years Respodents 36-40years Over 40 years 21-25 years 26-30Years 31-35 years 36-40years Over 40 years

Source: Author (2012) Table 4.2 and figure 4.2 shows that ,20% of the respondents were between 21-35 years while majority 33% of the respondents were in the age brackets of 26-30 years .27% were in the age of 35 years .13% were aged 36-40 years while the rest 7% were aged over 40 years. Therefore the majority of respondents were between the ages of 26-30 Years.

4.2.3 Response According to Gender of the Respondents Table 4.3: Gender distribution Gender Male Female Totals Source author [2012]
39

Frequency 25 5 30

Percentages 83 17 100

Figure 4.3: Gender distribution

17%

Key
Male Female

83%

Source: Author (2012) Table 4.3 and figure 4.3 above shows that, 83% of the respondents were male while rest 17 % of the respondents were female .Therefore Majority of the respondents were male.

4.2.4 Response According to Education Level Table 4.4: Educational level Level Secondary College University Others Total Source :Author (2012) Frequency 7 15 8 0 30 Percentage 23 50 27 0 100

40

Figure 4.4: Educational level

0

27%

23%

Key
Secondary College University Others 50%

Source author (2012) Table 4.4 and figure 4.4 above shows that 23% of the respondents had secondary level education while 50% of the respondents were of college level and 27% of the respondents had university education. Therefore the majority of the respondents had gone through college education. 4.2.5 Response According to Duration in the role of purchasing in Al-Fatah supermarket Table 4.5 Duration in the role of purchasing in Al-Fatah supermarket Duration Less than 2 years 3-6 years 7-10 years 11-14 years Over 15 years Totals Source; Author (2012)
41

Frequency 6 8 8 3 5 30

Percentage 20 27 27 10 16 100

Figure 4. 5 Duration in the role of purchasing in Al-Fatah supermarket

16%

20%

10%

Key
Less than 2 years 3-6 years 27% 27% 7-10years 11-14 years Over 15 years

Source; Author (2012) Table 4.5 and figure 4.5 shows that 20% of the respondents had less than 2 years carrying out the role of purchasing at 27 % had an experience of 3-6 years in purchasing at Al-Fatah , another 27% had an experience of 7-10 years ,10% had 11-14 years experience while those who had made purchasing decisions for over 15 years represented 16% of the respondents .Therefore the majority had the experience of 7-10 years. 4.2.6 Response According to Corporate Image of Locally Manufactured Goods Table 4.6 Image of the Locally Manufactured Goods Characteristics Very good Good Fair Poor Very poor Total Source :Author 2012
42

Frequency 0 0 0 1 29 30

Percentages 0 0 0 3 97 100

Figure 4.6 Image of the Locally Manufactured Goods

3%

Key
Poor Very poor

97%

Source :Author 2012 Table 4.6 and figure 4.6 above shows that 97% of the respondents indicated tat the image of locally manufactured good was very poor 3 % of the respondents said that the image was poor . Therefore the majority stated that the image was very poor. This clearly indicated that the image of the locally made the goods was not appealing to the local buyer. 4.2.7 Response according to the influence of image to consumer demand Table 4.7 Influence of Image to Consumer Demand Characteristics Yes No Total Source; Author (2012) Frequency 30 0 30 Percentages 100 0 100

43

Figure 4.7 Influence of Image to Consumer Demand

Key
Yes No

100%

Source: Author (2012) Table 4.7 and figure 4.7 above shows that ,All 100% of the respondents agreed that image was a factor that influenced consumer demand. 4.2.8 Response According to Rate of Pricing of Locally Manufactured Goods Table 4.8: Rate of pricing of locally manufactured goods. Characteristics Very good Good Fair Poor Very poor Totals Source: Author 2012 Frequency 0 0 0 2 28 30 Percentages 0 0 0 3 97 100

44

Figure 4.8: Rate of pricing of locally manufactured goods.

3%

Key
Poor Very poor

97%

Source: Author 2012 Table 4.8 and figure 4.8 shows that ,93% of the total respondents stated that pricing of locally manufactured goods was very poor while 7% indicated that pricing was poor . Therefore the majority agreed that pricing was very poor.This in essence meant that locally manufactured goods were over priced and or that the manufacturers of the same product did not put the economic situation of the local buyer in consideration when pricing their product. 4.2.9 Response According to influence of Price Demand of Locally Manufactured Goods Table 4.9: Influence of Price Demand of Locally Manufactured Goods Characteristics Yes No Total Source :Author 2012
45

Frequency 30 0 30

Percentages 100 0 100

Figure 4.9: Influence of Price Demand of Locally Manufactured Goods

Key
Yes No

100%

Source: Author (2012) Table 4.9 and figure .9 above shows that, 100% of the respondents indicated that pricing or price was indeed a factor that influenced consumers demand. This was to say that local buyers looked at the price of a product before choosing the product to buy or before making any purchasing decision. 4.2.10 Response According to effect of Demand on Locally Manufactured Goods Table 4.10 Effect of Demand on Locally Manufactured Goods Characteristics Yes No Total Source: Author (2012) Frequency 30 0 30 Percentages 100 0 100

46

Table 4.10 Effect of Demand on Locally Manufactured Goods

Key
Yes No

100%

Source: Author 2012 Table 4.10 and figure 4.10 shows that, 100% of the respondents were in agreement that quality was a factor that influenced consumer. A clear testimony as to how buyers valued product quality when making purchasing decisions.

4.2.11 Response According to Extent of effects of Quality on consumers demand Table 4.11: Extent to which quality influenced consumers demand Characteristics Frequency 29 Great Fair Low Very low Total Source; Author (2012) 1 0 0 0 30 Percentages 97 3 0 0 0 100

47

Figure 4.11: Extent to which quality influenced consumers demand

3%

Key
Very great

Great

97%

Source: Author 2012 Table 4.11 and figure 4.11 above shows that , 97% of the respondents indicated that quality affected consumers demand to a very great extent, while 3% of the respondents indicated that quality affected consumer demand to a great extent. Here then, quality came out as a very strong factor in influencing consumers demand of locally made goods.

4.2.12 Response According to Rate of competition of locally manufactured goods Table 4.12:Rate of Competition of locally manufactured goods Characteristics Very good Good Fair Poor Very poor Total Source; Author (2012)
48

Frequency 0 0 1 3 27 30

Percentages 0 0 3 10 87 100

Figure 4.12: Rate of Competition of locally manufactured goods

3% 10%

Key
Fair Poor Very poor

87%

Source: Author 2012 Table 4.12 and figure 4.12 shows that, 87 % of the total respondents indicated

competition of locally manufactured goods was very poor 10% indicated poor and 3% indicated fair competition. Therefore the majority indicated that the competition of locally manufactured goods was very poor. This in translation meant that most of the locally made goods were not at all competitive.

Table 4.13 Response According To Effects of Competition of Locally Manufactured Goods Table 4.13: Effects of Competition of Locally Manufactured Goods Characteristics Yes No Total Source; Author (2012)
49

Frequency 30 0 30

Percentages 100 0 100

Figure 4.13: Effects of Competition of Locally Manufactured Goods

Key
Yes No

100%

Source: Author 2012 Table 4.12 and figure 4.13 shows that, 100% of the respondents indicated that competition influenced consumer demand. This response characteristic in fact suggested that competition was indeed a factor that influenced consumers demand and that, any effort that neglected product competitiveness was an effort towards product and or organizations failure.

4.2.14 Responses According to Rate of Dealers Support on Locally Manufactured Goods Table 4.14: Dealers support of locally manufactured goods. Characteristics Very good Good Fair Poor Very poor Total Source: Author (2012) Frequency 0 0 0 2 28 30 Percentages 0 0 0 7 93 100

50

Figure 4.14: Dealers support of locally manufactured goods

7%

Key
Poor Very poor

93%

Source: Author 2012 Table 4.14 and figure 4.14 shows that ,93% of the total respondents indicated that the local manufacturers support to the local retailer was very poor . 7% of the respondents indicated poor dealers support. Therefore the majority of respondents indicated that the rate of dealers support on locally manufactured goods was very poor. This shows that the local manufacturer had not adequately supported the local retailer offload the locally manufactured products into the local market. 4.2.15 Response According to Effects of Dealers Support on Locally Manufactured Goods Table 4.15: Effects of Dealers Support on Locally Manufactured Goods Characteristics Yes No Total Source; Author (2012)
51

Frequency 30 0 30

Percentages 100 0 100

Figure 4.15: Effects of Dealers Support on Locally Manufactured Goods

Key
Yes No

100%

Source; Author (2012) Table 4.15 and figure 4.15 shows that, 100% of the respondents indicated that dealer support was indeed a factor that influenced consumer demand of locally manufactured product.

4.3 Summary of Data Analysis When asked of their suggestions on the image of locally manufactured goods, most of the respondents called on the local manufacturers to invest a lot on image improvement of the locally made goods for them (manufacturers of locally made goods) to realize increased benefits on their investments. On pricing, most of the respondents agreed that the price of the locally made goods was very poor and called on the manufacturers of locally made goods to improve on or harmonize the pricing of the local goods and affix the prices that were reflective of the local economic situation and consumer product affordability.
52

Suggestion on quality, most of the respondents urged the local manufacturers to improve the quality of the locally made goods so as the same manufacturers could realize benefits form their own investments. Products feature that reflects or were in line with the changing consumers tastes and preferences were felt to be essential to improved consumer demand of locally made goods. On competition, the respondent indicated that the competition of the locally manufactured goods was very poor and suggested that the local manufacturers should invest a lot in product variety and sizes to meet the different consumer tastes and preferences and product affordability. When asked on suggestions of dealers support, the respondents intimated that the manufacturers of the locally made goods did not adequately support the local retailer to offload the locally made products to the final consumer. Some respondents suggested increase in product promotion and advertisement both in the media and in the retail stores to increase product awareness and provision of product information and technical support to technical product which would eventually result in increased product take off from the retail stores. The general findings were that the manufacturers of locally made goods were rated very poorly on all of the following factors which were under investigation in this study; image, price, quality, competition an dealers support and that the said factors indeed influenced consumers demand to a very great extend. The manufacturers of the locally made product were also advised to urgently address the above factors which would result to an over whelming support by the local retail and the local consumer as well, thus reversing the current problem.

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CHAPTER FIVE SUMMARY OF FINDINGS, CONCLUSIONS AND RECOMMENDATIONS 5.1 Introduction This study was carried out with the aim of finding out the factors that influenced consumers demand of locally manufactured goods in the retail outlets. As such the researcher wanted to establish if/whether corporate image, pricing, quality, competition and dealer support influenced consumer demand in Al-Fatah supermarkets. To facilitate the undertaking of this study, a researcher questionnaire was formulated, directed to the employees of Al-Fatah who carried out the role of making purchasing decision .purchasing decision makers in any retail organization hold a key to determining the organizations clientele, what is bought both by their organization and its clients .from which the manufacturer the organization buys from, as well as influencing what the customer /consumer bought or purchased. there were a total of nine retail outlets that AlFatah supermarket limited operated country wide as at the time of the study ,but only six retail outlets within Nairobi city were targeted and the Al-Fatah headquarters /central stores. Tables with frequencies and percentages were used to help tabulate and analyze the received data.

5.2 Summary of Findings (According to Research Questions)

The researcher was able to establish that, corporate image, pricing, quality, competition as well as dealer support were factors that influenced consumer demand of locally manufactured products in the leading retail outlets. image/co operate of local manufacturers and /or that of locality manufactured goods was found to be very poor as rated by the respondents most respondents agreed that the image was a factor that influenced the consumer demand to a very great extend .there were suggestions that for the manufacturers of locally made products to realize increased benefits on their investments .the image of locally made goods had to be improved as well as the image of the manufacturers of the locally made goods.
54

The local manufacturer had not yet invested a great deal in product quality and quality improvements / enhancement. Despite the fact that quality influenced customers demand of the locally manufactured goods to a very great extent. The manufacturers of the locally made goods were urged to urgently improve on product quality. (Product features), to be inline or to reflect the ever changing consumers taste and preferences for improved consumers demand. Competition of locally manufactured product was found to be below the expectations of the local buyer. Competition was found to be a factor that influenced consumers demand to a very extend. Manufacturers of locally made goods ought to urgently invest a lot in increased product variety and sizes to meet the different consumers tastes, preferences and product affordability to improve of product consumers demand. Majority of the locally manufactured were not offering support to the local consumer and or the local chains of distribution channels. Most of the respondents indicated very poor dealer support and that the respondents recognized dealers support as indeed a factor that influenced consumers demand to aver great extent. Increase in product promotion, product awareness creation was called for, both in the media and in retail stores. Technical support on technical products was also felt a major boost to increased support by the local buyer. The research questions were answered as following; On factors that influenced Al-Fatah supermarket to demand and sale locally manufactured products, corporate image, pricing quality, competition and dealer support were found to be a factor that influenced the said firm to stock and sale of locally made goods. 5.2.1 How does corporate image affect demand In the retail industry in Kenya? From the findings 100 % of the respondents stated corporate image affected demand in retail industry in Kenya. Corporate image could have influenced the demand and sale of locally made products in Al-Fatah. Indeed image was found to have influenced the demand and sale of locally made product in the said organization.

55

5.2.2 To what extent does the price at which products were pegged, affected demand in the retail industry? Fro the findings 975 stated that price affected demand to a very great extent while% indicated that price affected demand to a great extent. Price and its effects on the demand and sale of locally made goods in al-fatah, quality was found to be a factor that influenced to vary great extent the demand and sale of locally made good in the leading retail outlets.

5.2.3 How does product quality affect demand in retail industry in Kenya? From the findings 100% of the respondents indicated that quality affected demand in retail industry in Kenya. Product quality was a factor that influenced the demand and sale of locally made products in Tusker, quality was found to influence the demand and sale of locally made goods in the leading retail outlets to a very great extent.

5.3.4 To what extent does competition affect demand in retail industry in Kenya? From the findings 97% of the respondents stated that competition affected demand in retail industry in Kenya to a great extent% to a great extent and 3% to a fair extent. Competition on the demand and sale of locally made goods in Al-Fatah, competition was found to have influenced to a very great extent by majority of respondents, the demand and sale of locally made goods in the leading retail outlets.

5.2.5 How does dealer support affect demand in the retail industry in Kenya? From the findings 100% of the respondents stated that dealer support affected demand I the retail industry in Kenya. Dealer support was a factor that influenced the demand and sale of locally made goods in Al-Fatah, dealer support was indeed found to be a factor that influenced to a very great extent the demand and sale of locally made goods in the said firm.

56

5.3 Conclusions
Organization ought to have equal opportunity employer. Good education was essential when recruiting staffs in the key departments of any organization, for this determined the success of the organization. Experience in a given line of duty was essential in understanding the functions , roles expectations and requirement of any given work or department. The manufacturer of the locally made goods have been challenged by the local buyers to invests a lot on the improvement on the image of both the local product and the manufacturers of the same for image was a way below the expectation of the local buyer. It can thus be said that, the local manufacturers has not yet made enough effort in ensuring that the local customers benefited adequately from product pricing. the manufacturers of the local goods have thus been challenged to take into considerations the local situation and the product affordability by the local consumer when pricing their goods. The manufactures of the locally made goods has been left with no better option than to improve on product quality to meet the ever-changing consumers tastes and preferences. It was required of the manufacturers of the locally made goods to improve products features and hence quality to match the ever changing consumers tastes and preferences. The manufacturers of locally made goods had not realized the reward and effects of product competitiveness. To improve on product competitiveness, the local manufactures was required to invest a lot in increased product variety and sizes. Adequate dealer support by the manufacturer of the local made goods was lacking. The said manufacturers should Endeavour to invest increased resources in dealer support to realize increased support for the local customers. The manufacturers of the locally made goods needs to move with the speed to rectify and urgently attend to the image , price, quality , competition of the local made products as well as the dealer support on the local consumers for said manufactures to realize increased return on every of their shillings that they invest.
57

5.4 Recommendations The local manufacturers had tried to invest a lot in resources win back and improve consumer demand of the locally manufactured goods by the local consumers/buyer. However despite those efforts, the local buyer had not qualified the local manufacturers as having done enough. The manufacturers of the locally made goods have thus been challenged by this report to; 5.4.1 Corporate Image The researcher recommends that the organization should carry out a continuous image appraisal by way of continuous research on corporate image rating by the local buyer.

5.4.2 Price The researcher recommends that the organization should carry out continuous price reviews and appraisal, in line with the existing economic parameters and situations and set consumers friendly prices.

5.4.3 Product Quality The researcher recommends that the organization should carry out continuous product quality review and appraisal, product features improvement with time, in line with the changing consumers tastes and preferences.

5.2.4 Competition The researcher recommends that the organization should improve on the product variety and increase product choice to cater for all different consumers wants and preferences across the consumer income classes for improved competitiveness.

5.2.5 Dealer Support The researcher recommends that dealer support should be enhanced to help shorten the product shelf life through the various activities that improve consumers product knowledge and awareness, including increased product promotion and advertising in the both media and distribution as well as the retail outlets. Being the best in the above issues
58

is the challenge that this research report and the local consumers are placing in every local manufacturers boardroom. 5.5 Suggestion for further studies. A lot remains to be studied on the factors that influenced or were essential to support of the manufacturer of the locally made goods by the local buyers as well as the factors that led to poor performance of the local manufacturer in the local market. For a clearer understanding on the above issues, further research along with the following lines could lead to better understanding on the same. Factors that lead to the poor performance among the members of the Kenya Association of manufacturers goods in the market, Macro-environmental factors that influenced consumers demand in the retail industry, Micro-environment factors that influenced consumers demand in the retail industry and finally on factors that influenced consumers demand of the local transport industry.

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REFERENCE Armstrong & Kottler (2006) principles of marketing, 7 Publishing in corporation Alphert &Gatty (1999) Restoring our competitive businesses 6th edition pg. 478 Harmondsworth, Penguin Books Ajzenicet (2005) Altitudes personality and behavior 5th edition open university Mc Graw Hill education , England Ailawadi kusum &Neslin (2001) open university press Mc Graw Hill education , England Bearden Ingram la Forge ( 2006)4th edition Marketing principles and Irwin Mc Graw Hill Bailey (1999) Research techniques Pearson Prentice Hall Publishing in corporation Ellison G & Ellison S.F (2009) Price elasticity on the internet 427-482 North western university New Delhi india. Kottler (2007) Marketing Management 11th Edition North Western University, Prentice Hall of India New Delhi. Kowalski & Western (2005) Branding strategies Dorling Kindersley (India) Pvt ltd Lynch J.G and Ariely D (2000) Search costs affect competition on price quality and distribution market science North western university New Delhi india. Leslie Lazar Kanuk (2007) Consumer behavior Pearson Prentice Hall Publishing in corporation Lind Quist Jay D (2003) Shopper buyer and consumer behavior theory applications and public policy applications Atomic Dog publishing marketing perspectives press 456th

edition Pearson Prentice Hall

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Lundgren (1996) Pricing strategies 2nd edition McMillan publishers Nairobi Kenya Perreault (1996) Basic Marketing 4th Edition Prentice Hall Inc U.K Philip Kotler(1997) Marketing of Management 9th edition Prentice Hall Inc Quail J (1999) Marketing strategies Management 6th Edition Foundation Press York Robinson (1999) Fundamentals of marketing 10th edition Prentice Hall Inc U.K Solomon Michael R (2002) Consumer behavior:Buying Having and Being sandle River N.J Prentince Hall William D Perreaut 2005 9th edition Essentials of marketing Irwin Mc Graw Grant(2000) stanlake's introductory economic. 7th edition-long man publishers Garvin(2002) managing quality," strategic and Competitive Edge". The Free press Publishers Jeikiu and yadin(2000) Public Relations, jlh edition, Preetise Hall publishers Juran (1999). Juran on leadership [for quality; An effective Handbook- The Free publishers Kotlers And Armstrong(1999).Principles of Marketing. 7th edition-prectise Hall Publishers. Mnllearn and Vane (2002) Economics -,London. palgrane, Porter (2008) Competitive Advantage. "Creating and Sustaining superior performance" The free press Publishers. Saleemi(1997) Economic simplified. 2nd Edition> N.A saleemi Publishers Dairy Nation, Nation Media group Hill upper New

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QUESTIONNAIRE
SECTION 1: PERSONAL INFORMATION 1. Age Bracket: (Below 20 yrs) 36-40 yrs 2. Gender: Male (21-25 yrs) (Over 51 yrs) Female Secondary level College level University level Other specify 4.. For how long have you undertaken the role of purchasing in the Al-Fatarh supermarket Less than 2 years 11-14 years 3-6 years Over 15 yrs 7-10 years (31-35 yrs)

3. Highest Level of Education:

SECTION B CORPORATE IMAGE 1.How is the image of locally manufactured goods sold at Al-Fatah supermarket? Very good Good Fair Poor Very poor

2. a) Do you think the image is a factor that influences consumers demand of locally manufactured goods? Yes No

(b) If yes, to what great extent? Very great Great Fair Low very Low

3.What are you suggestion of image of locally manufactured good? SECTION C PRICING 4. How is the pricing of locally manufactured goods sold in the Al-fatal supermarket? Very good Good Fair poor Very poor

5. (a) Do you think that price is a factor that influences consumers demand of locally manufactured goods? Yes No

6.What are your suggestions of pricing of locally manufactured goods?

ii

SECTION D QUALITY 8. a) Does quality affect consumer's demand of locally manufactured goods? Yes If yes, to what great extent? Very great Very Low 9. What is your suggestion of quality of locally manufactured goods? SECTION E COMPETITION 10. How is the competition of locally manufactured goods sold in the Al-Fatah supermarket? Very good Very poor 11 a) Do you think that competition is a factor that influences consumer demand of locally manufactured goods? Yes No Good Fair Poor Great Fair Low No

b) If yes, to what extent? Very great Very Low Great Fair Low

iii

12. What is your suggestion of competition of locally manufactured goods? SECTION F DEALER SUPPORT 13. How is the dealer support of locally manufactured good sold in the Al-Fatah supermarket? Very good Very Poor 14 a) Do you think that dealer support is a factor that influences consumers demand of locally manufactured goods? Yes b) If yes, To what great extent Very great Very Low 15 What is your suggestion of dealer support of locally manufactured goods? .. Great Fair Low No Good Fair Poor

iv