The Effect of Price Regulation on Competition Among Oil Firms in Kenya
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Date
2012-10Author
Njuguna, Catherine N
Type
ThesisLanguage
enMetadata
Show full item recordAbstract
Pricing is one of the strategies that firms use to compete in the market. When pricing as a
strategy is controlled through regulation, it then ceased to be a competitive factor. In the
absence of price strategy therefore, do firms still compete and on what grounds especially
when the product is homogenous? This was the crux of this paper considering the price
regulation in the oil industry in Kenya. The objective of this study was to determine the
effect of price regulation on competition among oil firms in Kenya.
This study was a descriptive survey. The target population of the study was all the ten oil
marketing firms. Primary data was collected using a structured questionnaires
administered to the Managing Directors using drop-and-pick later method. The analysis
was done using descriptive statistics such as mean scores and percentages. Results were
presented in table and charts.
The study found that service quality was the most adopted strategy by most of the firms
followed by focus strategy and lastly the pricing strategy. The study also found that the
intensity of competition was also low after the introduction of price regulations. The
study concludes that the price of fuel in the price regulation era was marginally lower
than the period before the price regulations. The study also concludes that price ceilings
have reduced the level of competition in the oil industry. The study recommends that
there is need for the oil marketing firms to be allowed to import oil on their own from the
suppliers they are comfortable with. This will give them the leeway to negotiate better
prices hence reduce their costs and enable them to price the fuel better in the market.
Publisher
University of Nairobi
Rights
Attribution-NonCommercial-NoDerivs 3.0 United StatesUsage Rights
http://creativecommons.org/licenses/by-nc-nd/3.0/us/Collections
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