Impact of Technological Factors on the Competitiveness of Ethiopian Footwear Industry
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Date
2020-06
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Addis Ababa University
Abstract
Competitiveness is the struggle of two or more parties stand-in independently to confident the
business of a third party by proposing the most promising terms. There are two different outlooks
that try to explain competitiveness. As a whole, macroeconomic perspective is famous as the
angle that categorizes what global competitiveness is in terms of price-based factors. Oppositely,
microeconomic perspective tries to categorize firm level competitiveness with non-price based
factors examining challenge between enterprises. The competitiveness of the footwear industry
of Ethiopia is not matured as its age due to different competitiveness factors like technology;
hence the enterprises are losing their markets for cheap imported shoes from foreign countries.
This study is done with the objective of examining the Technological factors that affect
competitiveness of the Ethiopian footwear industry. To meet this objective a survey of 6 shoe
factories was conducted around Addis Ababa. Out of 90 sampled respondents, 63 properly
answered and returned the questionnaire to the researcher. The survey data was analyzed using
factor analysis, the factor loadings and the measurement of decision rules adopted by Vichea
(2005) were used to analyze the Technological variables and their impact on the competitiveness
of the industries. In addition, the One-Way Analysis of Variance (ANOVA) is used to examine if
there is a statistical difference between the opinion of respondents regarding technological
factors. The finding indicated that significant technological factors have had different observed
force on the competitiveness of the companies. The result shows that all nine technological
factors were significant and supported. A competitiveness model is proposed to overcome the
highly affecting competitiveness factors of the sector. The model developed shows the
continuous improving of the price based and non-price based factor affecting these industries
competitiveness.
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Keywords
competitiveness, technological barriers, factor analysis, competitiveness model, price based, non-price based factor