Porter’s Generic Strategies and Market Share Growth of Skol Brewery Ltd in Rwanda

Abstract

The purpose of this study was to examine porter’s generic strategies and market share growth of Skol Brewery in Rwanda. The specific objectives were to: determine effect of cost leadership, differentiation, and market focus on market share growth of Skol Brewery in Rwanda. The target population consists of 287 staff members of Skol Brewery Ltd. The study used simple random and purposive sampling techniques to select a sample of 167 employees. Quantitative data was obtained using questionnaire while a documentary checklist was used to obtain secondary data. Descriptive and inferential statistics were used for quantitative data analysis while content analysis was used for qualitative analysis. Results on cost leadership show a tight cost in all business activities (mean of 4.333), economies of scale (mean of 3.666), and efficient cost saving for designs (means of 4.000) and effective operational cost reduction (mean of 3.666) were used as a cost leadership component. A positive correlation was found between cost leadership and sales (r=231**, p=0.006), investment rise (r=.159**, p=0.043) and profit margin (r=.174**=0.014).Results on differentiation felt that cost allocated to the control of quality of goods and services (mean of 4.333), effort in reputation management (mean of 4.000), names (mean of 4.833). A positive correlation was between differentiation and sales (r=.274**, p=0.039), investment rise (r=.187, p=0.035) and profit margin (r=.324, p=0.032).Results on market focus found that marketing specification for products (mean of 3.833) is the measurement that has the highest level of application. A positive correlation was between market focus strategy and sales (r=.854**, p=0.018), investment (r=.873**, p=0.035) and profit margin (r=.750**, p=.0.036). The study concludes that there is no significant relationship between porter strategies and market share growth. The study recommends that management of the brewery company should evaluate implementation of cost leadership, conduct a study on market focus to respond to market niches as any gap in customer centric products would yield customer non responsiveness, benchmark differentiation, and hire competent staff to achieve its success. Keywords: Porter’s Generic Strategies, Cost Leadership Strategy, Differentiation Strategy, Market Focus Strategy, Market Share Growth