An analysis of the impact of pricing strategies on financial performance of manufacturing packaging SMEs in Harare . · Electronic Theses and Dissertations

Author

Chimuzano, Melissa R

Title

An analysis of the impact of pricing strategies on financial performance of manufacturing packaging SMEs in Harare .

Abstract

This study aimed to analyze the impact of pricing strategies on financial performance in manufacturing packaging SMEs in Harare. The study examined pricing strategies that included cost-based, value-based, competition-based and premium pricing strategies by employing a mixed approach research design. It also examined factors affecting the choice of pricing strategies which include cost components, competition, customer preferences and business objectives. Challenges faced in developing and implementing pricing strategies include high production costs, competition, limited access to market data and high inflation rates. The research design was a both quantitative and qualitative approach which makes use of questionnaires and interviews. The target population was packaging SMEs in Harare who specialize in flexible packaging, paper and cardboard packaging, labels and stickers packaging and rigid packaging. The sample size was 110 manufacturing packaging SMEs and sampling methods were stratified and purposive sampling. Both descriptive (mean, standard deviation and percentage) and inferential statistics (multiple linear regression) were calculated using the help of SPSS. The key findings of the study were that there is a relationship between pricing strategies and financial performance and cost of production and competition are important factors to consider when setting a pricing strategy. Competition is both a factor and challenge when it comes to pricing approaches. The study recommends that SMEs should frequently analyze and adjust their pricing strategies to become accustomed to cost variations and fluctuating market conditions caused by inflation rates and competition. It is also important to establish strong cost accounting systems to manage production costs, hence understanding cost structures is very important. Suggested areas of additional research include exploring the role of technology in shaping pricing approaches and economic outcomes resulting from pricing decisions and assessing the financial performance implications of adopting sustainable and eco-friendly packaging solutions in Harare.

Date

June 2024

Publisher

BUSE

Keywords

Pricing strategies, Financial performance, Manufacturing packaging SMEs, cost-based pricing, value-based pricing, premium pricing

Supervisor

NIL