Competitive Strategies and Performance of Small and Medium-Sized Enterprises in Lira City of Northern Uganda
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Date
2021
Journal Title
Journal ISSN
Volume Title
Publisher
Lira University
Abstract
The study sought to find out the significance of competitive strategies on performance of small
and medium-sized enterprises (SEMs), particularly in Lira City of Northern Uganda.
Specifically, the study focuses on the influence of the market focus on the performance of
SMEs, the effect of cost leadership on the performance of SNEs and the significance of product
differentiation on performance of SMEs. According to Porter (2000) higher performance would
be attained in an industry that is filled with competition through pursuing strategies which
include being a leader in term of low cost, strategy for differentiating product and services and
strategy on focusing at a particular market segment. A theoretical model was induced using
competitive strategy paradigm of literature. It consisted of market focus strategies,
differentiation strategies, cost leadership strategies and performance dimension.
Cross-sectional design with quantitative method of investigation was moved to fulfill the
objectives of the study. A 5-point Likert scale questionnaire was used to measure responses of
390 business respondents in Lira City. Three hypotheses were posted to explore the effects of
competitive strategies on performance of SMEs. The study was structural equation Modeling
(SME) for analysis.
The result indicated that cost leadership strategies positively and significantly influence
performance of SMEs in Lira City. Recommendations arising from the study are that SMEs
should adopt competitive strategies particularly cost leadership strategies, as it shown to
enhance productivity leading to better performance. This finding is in agreement with Porter
(2000) who argued that higher performance would be attained if affirm is a leader in term of
low cost.
In conclusion, cost leadership has a significant influence on performance of SMEs while
product differentiation and market focus have no significant influence on financial performance
of SMEs.
Description
Keywords
Competitive Strategies, Performance, Enterprises, Small and Medium-Sized Enterprises
Citation
Otim, J.D., Jehopio, P.J., and Kuka, P. (2021). Competitive Strategies and Performance of Small and Medium-Sized Enterprises in Lira City of Northern Uganda