PRODUCT DIVERSIFICATION AND PERFORMANCE OF FOREIGN FAST FOOD RESTAURANTS IN NAIROBI CITY COUNTY, KENYA
Abstract
Over the years there has been an increase in the number of foreign fast food restaurants in Nairobi with an aim of bringing foreign food quality standards in Kenya just like in other country. Foreign fast food restaurants in Nairobi are stationed around a model of convenience to the growing market of customers and the business has been booming with competition among the restaurants. Foreign fast food restaurants have been coming up with different diversification strategies in order to stand out in the highly dynamic environment, to increase product diversity and profitability. The study investigated the influence of product diversification strategies on performance of foreign fast food restaurants in Nairobi City County. Performance of foreign fast food restaurants was measured through in-depth assessment on financial and non-financial indicators which was guided by the resource based view theory. The study adopted descriptive research design and targeted approximately 30 foreign fast food restaurants operating within Nairobi City County and 3 respondents from each restaurant filled the questionnaire. The research data was collected from the respondents by use of questionnaires which had both open ended and closed ended questions. The questionnaires were distributed through ‘‘drop and pick later’’ procedure. Moreover, the collected data was cleaned and coded then analyzed using inferential and descriptive statistics. The study established that product diversification had a positive significant impact on performance of foreign fast food restaurants in Nairobi City County. Some of the product diversification measured institute revolved along new product innovations and alignment of current product distribution channels. Most of the restaurant had several retail outlets within Nairobi, most of foreign fast food restaurants in Nairobi had embraced various strategies to keep competition low by dominating in the market. The study concluded that product diversification have a significant effect on performance of foreign fast food restaurants. Foreign fast food restaurants in Nairobi should embrace product diversification strategies; however these strategies must be anchored on research & development and strong market analysis. Fast food restaurants must continually intensify measures that unearth the potentiality that comes along with full utilization of this measure.
Key Words: Product Diversification, Geographical Diversification, Vertical Integration, Horizontal Integration and Performance of Foreign Fast Food Restaurants
CITATION: Alumasa, B. A., & Maina, S. (2021). Product diversification and performance of foreign fast food restaurants in Nairobi City County, Kenya. The Strategic Journal of Business & Change Management, 8 (4), 388 – 400.
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DOI: http://dx.doi.org/10.61426/sjbcm.v8i4.2107
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