Quality Management Practices and Customer Retention in Micro and Small Enterprises in Nairobi City County, Kenya

Abstract

The contents of this study was based on the following objectives; establishing quality management practices among micro and small enterprises (MSEs) and thereafter determining their influence on customer retention in micro and small sized enterprises (MSEs) in Nairobi City County, Kenya. The research involved a descriptive study that took on a cross-sectional survey design aimed at establishing the quality management practices and customer retention in MSEs, in Nairobi City County, Kenya as the area of study. The target population in this study comprised of all micro and small enterprises (MSEs) registered with Nairobi Municipal Council and operating in Nairobi County. Municipal Council of Nairobi has registered 34,242 MSE’s (Municipal Council of Nairobi2014). The smallest element (unit) of the study inquired was managers/owners of the firms. Using a survey software system known as CS, CSSS (1982), the study got a sample size of 340 respondents taken from a population of 34,242. This was meant to attain a confidence level of 95% at confidence interval of 5.75, with an assumption that the worst case scenario of respondents was 50%. The study majorly used primary data sources. The data was collected used semi-structured questionnaires consisting of both close and open questions. The completed questionnaires were edited for completeness and consistency before processing them. Analysis was done using a content and descriptive analysis to analyze the respondents take on quality management practices and customer retention in MSEs. Multiple regression analysis was employed to help establish the statistical significance of the independent variables on the dependent variable (customer retention). This study concluded that commitment by top management, focusing on customer, employee participative role, process control and continuous improvement, education and training, recognition and awards, supplier-producer quality management are able to explain customer retention variable as big as 99.6% percent. The study recommended that there is need for the MSE’s management to implement organizational culture change in the organization so as to enhance the implementation of quality management practices thereby enhancing the strategy used by organizations of continuous improvement, open communication and cooperation within the organizations.