ABSTRACT

The Sacco sub-sector in Kenya has been identified by The World Council of Credit Unions (WOCCU) as the fastest growing in the World. The SACCO Societies Regulatory Authority (SASRA) adds that the sub-sector continues to play a pivotal role in the realization of vision 2030 of mobilizing savings for Kenya’s investment needs. With the intense growth of the sector, the SACCO subsector operates in a context of intense competition. As such, the sector players continuously engage in measures to sustain their growth momentum to ensure they survive. The study sought to determine the influence of Corporate Growth strategies on the performance of SACCOs in Nyeri County of Kenya. Specifically, the study aimed to establish the effect of Market Penetration, Product Development, Market Development and Diversification strategies on the performance of SACCO’s. Performance indication embraced a number of perspectives for better comparisons. The researcher used outreach performance (Membership Volume), Market based measures (Market share) and Accounting Based measures (ROA). A Census study technique was used to select all the 15 active SACCOs in the sub county as gathered from the Directorate of Cooperative Development of Nyeri County Government. The study was interested with financial performance of the SACCOs for 4 financial years 2012/2013-2014/2015. The study used both primary and secondary data resources. Primary data was collected using questionnaires. The instrument was tested for validity and reliability using expert opinion and using SPSS derived Cronbach’s Alpha. The study also utilised secondary data which was gathered from the Annual financial Statement and reports of the SACCOS. The study used SPSS to generate both descriptive and inferential statistics. As explained by R square, which is the Coefficient of Determination, 78.90% of the variation in the Performance of SACCOs (the dependent variable) was explained by variability in the independent variables, that is, Product Development, Market Development, Market Penetration and Diversification. The study established that corporate growth strategies influence the performance of SACCOs. Regression results established that all the corporate growth strategies were significant determinants of performance. Correlation analysis results indicated that Product Development has a very strong positive relationship with performance. The association between either market development or market penetration with performance was strong and positive while diversification demonstrated a moderate, positive association with performance. The study therefore recommended investment in corporate growth strategies with a special emphasis on product development as an intensive strategy for the growth of the SACCOs.