Abstract:
Marketing strategies constitute one of the key functional strategies that Small and Medium Enterprises (SMEs) adopt to enhance performance. This study is aimed to examine the effect of marketing strategy on SMEs performance in Jimma City. By taking the research objectives and questions into considerations, only quantitative research approach and both descriptive and explanatory research design were used. The study was delimited to proportionate stratified and purposive sampling techniques. Quantitative data was collected using a structured questionnaire which has been developed and distributed to a sample of 122 owners and/or managers of SMEs in Jimma city. With a response rate of 96.7%, 118 questionnaires have been returned and were valid for data analysis. The quantitative data were analyzed by using descriptive and inferential analysis. The findings of descriptive statistics have shown that the mean score of marketing strategy inclined to agreement level. Independent variables have the significant correlation with the dependent variable performance‟. In this case, relatively price strategy had a higher strong relationship with performance. Likewise, the empirical findings of the multiple regression indicated that, only four of the predictor variables Product, Promotion, Price, and Relationship Marketing have a positive and significant effect on the Performance of SMEs but, place and customer orientation is not. The results also revealed that these independent variables were significant joint predictors of performance. The independent variables jointly explained 53.5% of the variance in performance. The study recommends that SMEs in Jimma city should continuously embrace product strategy as this strategy provided a framework for creating new products or improving the performance. The SMEs should continually adopt pricing strategies, promotion strategies and relationship marketing strategies as these tactics were found to have a positive impact on business performance.
