Factors Influencing the Internationalization of Kenyan Firms in the Chemical and Allied Manufacturing Industry

Abstract

In the last five years, there has been a growth in Kenyan Multinational corporations' foreign participation in emerging markets. Most are encouraged to expand their operations abroad with the promise of digitization and Market liberalization. The main objective for expanding abroad is to compete for limited resources while relying on the provision of markets for their products by the global economy. However, most firms do not have strategies to deal with the fast paced markets they intend to operate in. Additionally, they cannot deal with conflicting policies and the fluctuation of the currency. Therefore, firms ought to review their structure and policies before internationalizing their operations. The study adopted a descriptive research design to answer the how much, where, when, what, or who. Only the senior most ranking officers, the CEOs or MDs and their deputies, were targeted since they are in charge of strategic decision-making and are best placed to have information about factors influencing the internationalization process. The study used questionnaires to collect data from a list of chemical and allied firms registered at KAM. Analysis revealed that age and size, technology, Management and product type significantly influence the Internationalization of Chemical and Allied firms in Kenya. A conclusion was made that due to the continued global technological advancement, chemical and allied firms in Kenya should adopt superior technologies meant to reduce production costs, maximize profits, and give the firms a competitive advantage. Additionally, firms should consider the product's uniqueness and product specificity since they influence a firm's competitiveness. The study recommended developing and acquiring information on the foreign markets prior to expanding abroad which can be achieved through outsourcing for the services of management personnel in the country of interest or employing individuals with international experience and education. Additionally, adopting superior technologies will be key in reducing production costs, maximize profits, and give the firms a competitive advantage. Lastly, the government should actively provide firms with information on foreign market opportunities through the Export Promotion Council. They can also provide financial support to smaller firms wishing to expand their operations abroad.