Effect of Competitive Strategies on Growth of Savings and Credit Cooperative Societies in Bungoma County, Kenya

Abstract

This study sought to examine the effect of competitive strategies on the growth of Saccos in Bungoma County. The study was anchored on Agency Theory; Resource Based View theory and Stewardship theory. Its specific objective was to determine the effect of differentiation strategy on the growth of Saccos in Bungoma County. The study employed a descriptive research design and targeted a population of 112 Sacco top management staff of active Saccos in Bungoma County. The Chief Executive Officers, Chairpersons, Treasurers and Honorary Secretaries were the main respondents and were studied in a census. Data was collected using a self administered questionnaire whose reliability was tested in a pilot study. Findings of the study revealed that there was a significant positive relationship between differentiation strategy and growth of Savings and Credit Cooperative Societies in Bungoma County. The study therefore recommended that Saccos adopt differentiation strategy through initiatives like offering unique products and services, instituting non-executive boards of directors, establishing strategic committees, opening up the common bond, opening doors for licensing and regulation by Sacco Societies Regulatory Authority (SASRA), and crafting strategic plans. Other initiatives include establishing reliable strategic partnerships with other financial and non-financial institutions, reserving sufficient funds annually as institutional capital to shield against unforeseen risks and operationalizing a unique operation/ service delivery system. The findings and recommendations of this study would be valuable in helping managers of Saccos and other financial institutions together with policy makers in this sub sector like SASRA, KUSCCO and WOCCU in determining the appropriate strategies to be embraced in fostering the growth of Saccos in Kenya and the world at large.