Empirical Assessment of Performance of Dangote Cement Plc: An End-Users’ Perspective

Mahmood Adeiza ,Hassan N Ibrahim ,Malami Muhammad Maishanu

doi:10.7176/ejbm/13-10-15

Abstract

End-users, who are the focus of this assessment of performance in respect of Dangote Cement Plc, have been regarded as the most important stakeholder of any business activity. Previous works have not showcased an assessment of performance based on an end-user’s perspective which is why this study sets out to resolve the problem concerning how end-users react to market changes when patronizing the Nigeria cement manufacturing industry. Simple regression model was used to test the hypotheses – to show the relationships between the dependent variable - Cement Production Level (CPL) and the independent variables - Annual Average Price per bag of Cement (AAPC) and Turnover (TO). The study found that the explanatory variables portrayed significant positive relationships with CPL. In both cases, this relationships were very strong because the correlation coefficients (R) were above 97% and the adjusted coefficients of determination (adjusted R 2 ) which are the explanatory variables showed that there was more than 62% significance in their relationships with CPL. This means, that over 97% of Dangote Cement Plc’s production (supply of cement) succeeded in keeping prices up 62% of the time. The paper found that end-users increasingly continue to patronize products of necessity even when they are produced by a firm quite monopolistic in nature because they have no near substitutes. As a result, there is a policy implication that even though end-users expect quality products, great value, or a compelling brand and would equally avoid products of companies that fail to deliver on customer service, they (end users) may have no succor other than a regulatory regime set by the Government especially where monopolistic goods of necessity (such as cement) are concerned. Accordingly, the study recommends that government (or its agency) should set up minimum production volume benchmarks, regulate margins and establish price ceilings to protect the end-user. Key terms: Assessment of performance, Cement, End-user, Cement Production Level, Annual Average Price per bag of Cement, Turnover. DOI: 10.7176/EJBM/13-10-15 Publication date: May 31 st 2021

Highlights

As stakeholders in any business, which affects their interests, end-users encounter uncertainties and are usually able to judge how such uncertainties have affected them by assessing past business activities in order to be better prepared for future dealings
The outcomes mostly revealed that the Nigeria Cement Industry needs to drive improved performance by injecting or attracting significant investment but in the particular assessment of performance by Awen, it was made from the perspective of various stakeholders showing how these stakeholders would evaluate of the industry but, by whatever design, a very important stakeholder was not discussed. In view of these observations, this study focuses on assessment of performance from an end-users perspective in the cement industry in Nigeria within the period 2013 to 2016 as a gap deserving of a generous research effort
While looking at the Cement Production Level (CPL) column, it is clear that the level or degree of relationship between the variables vary significantly when being correlated with CPL

Summary

Introduction

As stakeholders in any business, which affects their interests, end-users encounter uncertainties and are usually able to judge how such uncertainties have affected them by assessing past business activities in order to be better prepared for future dealings. LSM (2017) explained that customers (by extension, end-users) want easy access to good quality products and services at competitive prices. Other stakeholders such as government, shareholders, creditors, debtors, competitors, management and employee have different expectations. Management may want a higher turnover and profit after tax in order to earn higher commissions based on their performance or may even be interested in cutting down on taxes and employee usually look out for higher pay and better job security in the face of pay-cut risks and unexpected job losses

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