Comparative Analysis of Institutional Competence of Floriculture Export Companies: In the Case of Foreign Owned and Locally Owned Firms in Ethiopia
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Date
2020-06
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Addis Ababa University
Abstract
Two decades have elapsed since flower began to be produced in Ethiopia for commercial
purpose. The report of some studies shows that locally owned floriculture firms exit from the
sector. However, foreign owned firms assumed dominance in this industry. Therefore, the
objective of this project is to examine institutional competitiveness between local owned firms
and foreign owned firms by assessing their investment capability, production capability, linkage
capabilities and marketing capability.
In order to achieve this quantitative and qualitative data was collected, in which ten
managers or owners of flowers firms answered the questions on questionnaires as well as key
informants from EHPEA were interviewed as per the questions on semi-structured
questionnaires. Moreover, export volume and value of each flower firm was collected from
Ethiopia custom office.
Questionnaires were prepared for flower firms to collect quantitative and qualitative
data focused on firm’s investment capability, production capability, and linkage capability and
marketing capability.
The result of the project showed that foreign owned firms are more competitive than
locally owned firm in terms of investment capability.
Similarly, the result of this project showed that locally owned firms are less competitive
than foreign firms regarding production capabilities.
The result also indicated that foreign firms that more competitive than locally owned
firms in terms of linkage capabilities.
Moreover, the result reveals that foreign owned firms are more competitive than locally
owned firms regarding marketing capabilities.
This implies that foreign owned firms are more competitive than locally owned firms on
major four capability indicators.
The finding of this project is used to make recommendation for locally owned firms to
improve their competitive related to investment, production and product, linkage and marketing
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capabilities such as establishing managerial strategies related to set up their own marketing
department to acquire and utilize their own marketing information build their financing
capabilities such as establishing managerial strategies related to set up their own marketing
department, to acquire and utilize their own marketing information build their financing
capabilities to get access to foreign and other local financing institutions, build relationship with
foreign firms to get knowledge spillover, hire consultants and industry experienced managers
from abroad.
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Keywords
words floriculture firms in Ethiopia, product, production capabilities