Abstract

Small business entrepreneurs operate in a very competitive environment in Cameroon which invariably affects their survival. Marketing strategy has been an operational focus and a method for achieving an all-inclusive business success. This study focuses to establish the effects of marketing strategies on sales performance of small and medium enterprises in Limbe Municipality.

Specifically, the study sought to examine the effect of promotional marketing strategy, price marketing strategy and location marketing strategy on the sales performance of SMEs in Limbe. The study was guided by the marketing mix theory and theory of push and pull. It adopted a descriptive research survey design, using simple random sampling techniques to sample 100 SMEs operators in Limbe using a structure-questionnaire.

Results shows that promotional strategies had a positive significant effect on effect on the sales performance of small and medium enterprises in Limbe Municipality. The study further concludes that employment of promotional strategies helped to keep customers informed of what the firm offered, promotional strategies informed clients or customers on both the price where to get the product and the price.

The study findings revealed that pricing strategies had a positive significant effect on the sales performance of small and medium enterprises in Limbe Municipality. However, pricing the product too low or too high can have unintended consequences sales. Pricing strategies give SMEs the flexibility in setting prices and win new business or maintain prices and increase the profit margin. Place strategies had a positive effect on the sales performance of small and medium enterprises in Limbe Municipality.

Location-based marketing is one of the best ways to convert foot traffic and online traffic into new customers. Location-based marketing helps to remove barriers to sales. The study recommends that SMEs owners in Limbe should be more committed to their pricing strategy to sustain the profitability and better performance of their enterprises.

CHAPTER ONE

INTRODUCTION

1.1 Introduction

Small and medium size enterprises (SMEs) are among world‟s most powerful financial drivers and they also contribute in creating employment opportunities and GDP (Oyebamiji, Kareem and Ayeni. 2013). Now, a day many financial sources are entirely found on small business enterprises with positive impact on the lives of everyone who engage in operating such business activities (Oyebamiji et al., 2013).

Moreover, these business enterprises also offer a wide range of services to meet the demand of the customers and clients‟ which in turn enhance high living standard (Mburu, 2015).In order to attain the potential benefits derived from the small and medium enterprises that could contributed for the development of large industries there must be favorable business environment.

The study is organized into five chapters. The first chapter provides the background of the study, a statement of the problem, the objective of the study, the research questions, hypotheses, significance of the study. The second chapter deals with literature reviews of concepts relevant to the study, theories and empirical findings.

The third chapter explains the types and sources of data that will be used for the study, the sampling techniques used to determine the sample size, and the method of statistical data analysis tools and collection. The fourth chapter presents the analysis and result of the study arrived at using descriptive and inferential statistical tools. The last chapter presents the conclusion and recommendations of the study.

1.2 Background to the Study

Marketing is generally considered the process by which companies create value for customers and build strong customer relationships to capture value from customers in return (Cavusgil & Zou, 2004). A strategy on the other hand is a firm’s game plan for competition and survival in a turbulent environment.

According to Mohamed et al., (2014), a marketing strategy is a process that can allow an organization to concentrate its limited resources on the greatest opportunities to increase sales. Sales performance is the sum of all efforts that it takes to deliver a product or service, therefore is measured in terms of items produced and services performed within a given period. Several marketing strategies can take any small and medium enterprise from mediocre to success when utilized correctly.

Marketing strategy has become an important tool globally for any organization to remain in a competitive market environment and wax stronger. Marketing strategy is a vital prerequisite for an industry’s ability to strengthen its market share and minimize the impact of the competition (Adewale, Adesola, & Oyewale, 2013). Researchers such as Owomoyela, Oyeniyi, and Ola, (2013) see marketing strategy as a way of providing a quality product that satisfies customer needs, offering affordable price and engaging in wider distribution and backing it up with effective promotion strategy (Adewale et a.l, 2013). Marketing strategy draws its strength from the overall corporate strategy. A marketing strategy outlines the strategic direction and tactical plans that marketing teams must implement to support the company’s overall objectives (Ebitu, 2015).

Marketing strategies and organizational performance have been grounded on the marketing mix theory and the theory of push and pull. The topic of marketing strategies was chosen as an effort to find out whether different marketing strategies undertaken by the small and medium enterprises in the study area have any effect on performance.

Effective marketing strategy requires decisions that successfully integrate a firm marketing program towards satisfying the consumer whose act in obtaining and using goods and services, including his decision process that precedes and determines those acts, are highly affected by the strategy adopted by the marketing manager in marketing the firm’s products (Kotler and Armstrong, 2006).

Several marketing strategies can take any small and medium enterprises from mediocre to success when utilized correctly. Breaking into a new business climate and finding customers is hard work, but when equipped with innovative ideas and proven techniques, financial markets sales personnel can become extremely successful (Kisaka, 2012). Key small and medium enterprises’ marketing strategies will always include an in-depth review of the value of follow-up. All successful sales intermediaries understand that consumers need to be contacted again and again to make a vital connection.

Micro and small businesses offer a number of advantages that make them interesting to less developed countries in terms of accelerating financial development (Kelemu & Mandefro, 2017). The direct exchange support of SMEs in developing nations isn’t in line with their significance at the domestic level. Concurring to WTO(world trade organization) calculations based on World Bank Endeavor Considers covering over 25,000 SMEs in creating countries, coordinate exchanges speak to reasonable 7.6 per cent of add up to deal with SMEs within the manufacturing segment, compared to 14.1% for large-scale industrial projects.

Among developing regions, Africa has the most reduced export share at 3 per cent, compared to 8.7 per cent for Developing Asia. SMEs have little interest in direct administrations commerce in developing countries, accounting for only 0.9 percent of total administrations trade compared to 31.9 percent for large firms (Loff, 2010). Small businesses in developing nations face a number of external and internal challenges. From  the outside: rivalry, limited production/market put, and the necessity for a showcase for the item or benefit; as well as other barriers to exchange. On the other hand, the inside (firm-specific) variables that repress the development of SMEs incorporate administration competency, lack of talented labor (Abdulmelike et al., 2018).

The number of new small and medium enterprises in Cameroon is shrinking rapidly. Competition is stiff within small and medium enterprises and product performance has not been effective compared to the last decade (Otieno, 2015). Most small and medium enterprises have sharpened their marketing strategies as a mechanism to guarantee the success of their business in future.

The challenge thus facing the small and medium enterprises is the need for diversification of their products better tailored and suited to meet the needs and development of the country. While small and medium enterprises can play a very significant and critical role in a nation‟s developmental process, the challenge currently being faced is how small and medium enterprises marketers respond by creatively introducing small and medium enterprises policies, instruments and marketing techniques to serve as a basis for the country‟s sustained economic development (Njoroge, 2015).

1.3 Statement of the Problem

In Cameroon, the contribution of small and medium enterprises is enormous and essential to the country’s economic development as well as poverty reduction. However, many micro and small enterprises in the country are facing a lot of challenges that contribute negatively to their failures. Some of these constraints are a lack of educated managers, limited access for gaining loans from government institutions, and limited infrastructures.

SMEs in Limbe Municipality are playing a great role in creating job opportunities for many youths in Limbe town. Despite those opportunities, SMEs are facing several problems such as unfavourable infrastructure, instability in the town, limited support from the government in terms of providing training, subsequent bankruptcy etc.

The effect of marketing strategies on the performance of SMEs has been a subject of growing interest in the field of strategy management (Kuwu et al., 2014). Studies by Ebitu (2015) indicated that marketing problems such as difficulty in managing a firm’s advertising, lack of adequate marketing research, unawareness of competition, poor branding and packaging, low level of knowledge on business market analysis, poor promotion, poor segmentation strategy, poor pricing technique and unplanned distribution contribute negatively in affecting Small and Medium Enterprises (SMEs) sales volume and profit margin.

In the past, many studies on marketing strategies were limited to large enterprises and are carried out in a western context (Olutunia and Obamuyi, 2008).

This accounts for a few studies on marketing mix strategies to address the issue around performance in the SME sector in Cameroon. In the Limbe Municipality context, it is observed that no empirical study has been conducted to investigate the effects of marketing strategies on the sales performance of SMEs in Limbe Municipality. This study, therefore, explored this gap.

1.4 Research Questions

1.4.1 Main Research Question

How marketing strategies affects the sales performance of small and medium enterprises in Limbe Municipality?

1.4.2 Specific Research Questions

1. How pricing strategy does affect the performance of SMEs in Limbe Municipality?
2. How promotion strategy does effects the performance of SMEs in Limbe Municipality?
3. How location strategy does effects the performance of SMEs in Limbe Municipality?

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