Assessment of the competitive strategies of private pharmacies: a case study of Lilongwe urban

Abstract

The business environment and government regulatory frameworks play an important role in creating a favorable context for the private sector to flourish. Firms face competition in their operating environment, whose intensity, depends on five competitive forces that include threat of new entrants, bargaining power of buyers, bargaining power of suppliers, threat of substitutes and intensity of rivalry. Competitive strategy aims to establish a profitable position against these forces. The concept of competitive strategy is critical to the survival and success of a firm in any industry because every firm faces competition and other challenges. This study was focused on establishing the competitive strategies that have been adopted by private pharmacies in Lilongwe Urban and also the factors that influence the choice of these competitive strategies. The study used both primary and secondary data in the study. Interview based questionnaire was administered and completed during interviews with the respondents in their business places. The results of the study were both qualitative and quantitative. Quantitative data collected using a questionnaire were also analyzed by the use of descriptive statistics using the Statistical Package for Social Sciences (SPSS) and presented through percentages, and frequencies. The information was also represented by use of bar charts, graphs and pie charts and in prose-form. This was done by tallying up responses, computing percentages of variations in response as well as describing and interpreting the data in line with the study objectives through use of SPSS. A total of 23 respondents were interviewed out of 26 respondents who were targeted representing 88 percent response rate. The findings indicated that the most utilized competitive strategies were low cost leadership, differentiation and focus strategies. The study also revealed that private pharmacies in Lilongwe Urban used cooperation with other competitors as a strategy. Others employ defensive, distribution and response strategies.