COMPETITIVE STRATEGIES AND PERFORMANCE OF SAVINGS AND CREDIT COOPERATIVE SOCIETIES IN NAIROBI COUNTY, KENYA

Abstract

The purpose of this study was to evaluate the influence of competitive strategies on the performance of large Savings and Credit Cooperative Organizations (SACCOS) in Nairobi County, Kenya. The research design adopted was descriptive, focusing on SACCOS that have been operational for more than 15 years. A census approach was used due to the manageable number of large SACCOS in Nairobi. Data was collected using both closed and open-ended questionnaires, ensuring a comprehensive understanding of the variables. The validity and reliability of the data collection instruments were rigorously tested. The study utilized both qualitative and quantitative data, with the latter analyzed using descriptive and inferential statistics through the Statistical Package for Social Sciences (SPSS). The qualitative data from open-ended questions was analyzed using content analysis. The study established that there was a positive and significant influence of cost leadership, differentiation, focus cost, and focus differentiation strategies on the financial performance of the SACCOS in Nairobi. The findings suggest that cost leadership enables SACCOS to gain a competitive edge by offering competitive pricing, which attracts more members and ensures sustainability. Additionally, differentiation strategies, including the adoption of technology, enhance the unique value offered to members, thus improving satisfaction. The focus cost strategy was found to be effective in targeting specific market segments with lower pricing, while focus differentiation catered to niche markets with specialized services. The study recommends that SACCOS should strategically manage their cost leadership to achieve profitability and market recognition. To maintain a competitive advantage, SACCOS should enhance product differentiation through innovative financial services and ensure that their focus strategies align with the needs of their target market segments.