| dc.description.abstract | This study sought to find out the linkage between vertical integration and competitive strategy. It
took the form of a case study of Githunguri Dairy Farmers Cooperative Society which is located
about 50km from Nairobi in, Githunguri Division of Kiambu District in Central Province.
Githunguri Dairy Farmers Cooperative Society Limited has pursued significant business growth
by being involved in raw milk supply, milk transportation, milk processing and packaging as
well as marketing and distribution of dairy products.
By use of an interview schedule, the researcher interviewed directors, managers and the
supervisors of the Society for the purpose of collecting primary data. Desk review of existing
literature was also carried out to aid in understanding what has been done in relation to linkage
between vertical integration and competitive strategy. The collected qualitative data was
analyzed using content analysis which was deemed appropriate, since the interviews conducted
were open-ended and did not limit respondents on the answers. For quantitative data, graphs and
tables have been used to summarize the data to facilitate comparisons. The analysis of the data
was guided by variables such as improvement in raw milk collection, milk processing, sales
revenue and market share in relation to increased competition and variations in the dairy value
chain.
The study has established that Githunguri Dairy Farmers Cooperative Society (GDFCS) has
integrated supply of raw milk with processing, transportation and distribution of dairy products.
The integration has leveraged economies of scale thus providing linkage between vertical
integration and the competitive strategy. The economies of scale and efficiency brought about by
vertical integration translate to cost advantages which are then passed to the consumers. This
forms the core around which the Society executes a cost leadership strategy. The Society's cost
advantage is built on its capability to process. and distribute affordable and quality dairy products
for the mass market, thus translating to growth in its market share. | en |
