Horizontal Integration Strategies and Competitiveness of Firms in EPZ Kenya

Abstract

Global challenges have given a rise in levels of competitiveness among industries that produce similar or related goods and services. One possible solution to this is the use of horizontal integration strategy to ensure efficient production. This study therefore intended to determine the influence of horizontal integration strategy on the competitiveness of EPZ firms. The study was guided by two theories, namely; the resource-based view theory and the transaction economic cost theory. The study adopted the use of a questionnaire. Both quantitative and qualitative approaches were used. Descriptive technique, specifically survey was used in the research design. The target population was all the 137 EPZ firms within Kenya and the sample was drawn from this population. The stratified random sampling technique was used. The EPZ firms are situated within the 74 gazetted zones. The quantitative data that was collected was analysed using the Statistical Package for Social Scientists. Further, the significance level of each independent variable was tested against the dependent variable at 95% level of confidence using ANOVA, regression and correlation techniques. The findings of this study indicated that horizontal integration had a positive and statistically significant relationship with the competitiveness of firms in EPZ Kenya. This study recommends the inclusion of horizontal integration in the strategic plans of the different EPZ firms. This will subsequently lead to an increase in employment opportunities, real-value added growth, and foreign direct investment (KNBS, 2022). In conclusion, from the analysis of findings, horizontal integration is significant for competitiveness of firms in EPZ Kenya.