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Competitive Strategies and Competitive Advantage Among Dairy Processing Firms in Kenya

Timothy M. Mwangi, Sabina W. Mwangi

Abstract

Dairy processing firms in Kenya operate within a highly competitive and rapidly evolving environment characterized by increasing milk production, market liberalization, technological change, and rising demand for value-added dairy products. Despite this growth, many firms continue to experience persistent performance disparities and challenges in achieving sustainable competitive advantage. This study examines the influence of competitive strategies on competitive advantage among dairy processing firms in Kenya, focusing on three key dimensions: cost leadership strategy, differentiation strategy, and innovation strategy. The study adopts a systematic literature review approach, drawing on empirical evidence from global, African, and Kenyan contexts to synthesize how competitive strategies influence firm- level competitive advantage. The review is anchored on Porter’s Generic Strategies Theory, the Resource-Based View, and the Dynamic Capabilities Theory, which collectively explain how strategic positioning, internal resources, and organizational adaptability shape competitiveness. Findings from the reviewed literature indicate that cost leadership strategy enhances competitive advantage through economies of scale, operational efficiency, and cost minimization, although its effectiveness is constrained by structural inefficiencies and market limitations in developing economies. Differentiation strategy improves competitive advantage through product uniqueness, branding, and value addition, with stronger effects observed in firms that effectively align differentiation with customer preferences and market positioning. Innovation strategy enhances competitive advantage through product development, process innovation, and adaptive capabilities, particularly in dynamic environments where firms continuously respond to changing consumer demands and technological advancements. However, the review reveals that the effectiveness of these strategies varies across contexts due to differences in resource availability, implementation capacity, and environmental conditions. The study concludes that competitive strategies collectively influence competitive advantage rather than operating in isolation, and that firm outcomes depend significantly on the quality of strategy implementation and contextual industry conditions within the dairy sector. It recommends that dairy processing firms integrate cost efficiency, differentiation, and innovation within a coherent strategic framework to strengthen sustainable competitive advantage. Additionally, future research should adopt longitudinal and mixed-method approaches to better capture the dynamic interactions among competitive strategies in the dairy industry. P-ISSN 2695-186X

Keywords

Competitive StrategiesCost LeadershipDifferentiationInnovationCompetitive AdvantageDairy Processing FirmsKenya

References

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