The Impact Of Product Innovation On The Growth Of A Firm
This research work on the impact of product innovation on the growth of a firm; this means, the yield that comes from innervating products. This impact ranges from high profitability, high scales volume increase, increase in sales volume, increase in market share and high competitive advantage. This work is divided into five chapters, which reveals the overview of the study, he Nigeria Breweries plc background, statement of the problem, objectives of the study. It also states the research questions, significance and scope of the study, limitation of the study and also definition of terms. Chapter two contains the literature review like various definitions of innovation, concepts of innovation, why firms innovate, innovation strategies and other point relevant to this study. Chapter three contains the research methodology and design, introduction, research design, sources/methods of data collection, population and sample size, sample technique, validity and reliability of measuring instrument and method of data analysis. Chapter four contains presentation and analysis of data, introduction, and presentation of data and interpretation of results. Chapter five has the recommend solution like improvement in marketing research and development. The recommended solutions include proper delivery schedule to make product available at the right time, right place, right quantity and right quality, summary of findings, conclusion and references.
The research work looks at This study explores relationship between innovative activities, profitability and firms growth in Nigeria Breweries Plc Awo – Ommama Owerri innovation is the future of any business and without a contains flows of new products. This is so because, the business environment is fast changing and becoming highly competitive so a consumers’ changes in taste and needs. ‘In this study, the researcher addressed a central issue in innovative studies namely:
GROWTH: Does it pay off to become involved in activity? What forms do the benefits of innovation take? Does innovation entrance short run profitability, or does it contributed to a growth, or both or neither. One important point about innovation is that it is not without cost, it requires the creation of tangible and intangible assets which increases production cost. S second basic argument about innovation and firm growth is that the innovation and firm growth is hat the innovation of new or technically superior product creates temporary monopolies, which improves the business growth of firms. However, such temporary imperfect competition can clearly be exploited in at least two ways. On the other, firms can raise prices on the imperfect competition can clearly be exploited in at least two ways. On the other, firms can raise prices on the imperfect competition advantage which imperfect returns on sales. Alternatively, firms can hold prices down, leading to more or less sharp improvement in the price-quality ration on the product resulting In increasing sales and profitability (however measured) may improve via innovation, but innovation will improve the growth of the firm. However, Nigeria breweries plc also OmmamaOwerri does have higher rate of growth of sales (which means also, that the absolute amount of profit grows faster than in non innovating firms) and impact of innovation on growth.
1.1 Background of the Study
Nigeria Breweries plc (NBPLC) is the country’s pioneer brewery incorporated on 16trh November 1946 and commercial production in 1949. it stated as a joint venture between the United African Company (UAC) international, UK and Heineken of Holland. Thus, at inception it was 100 percent foreign owned. Today, the company is 60% Nigeria owned and 40% foreign owned. The 40% foreign ownership is split almost equally between WA holdings ltd, ( for UNILEVA) AND Heineken Bro Uwerijen BV.
Its principal activities includes the brewering and marketing of larger bear, 33 bear, stout , no-alcoholic malt drinks and the boiling of Schweppes ranges of soft drinks and crush range. It operates from six breweries locations namely: Lagos, Aba, Owerri, Kaduna, Ibadan, Enugu, but the Aba location has recently shut down, due to the general recession dilapidated infrastructure facilities, political instability and the attended policy inconsistency and high cost of production in Nigeria, the company suffered declining productivity and profit between 1985 and 1996.
However, with consistent, strong and innovative initiatives and marketing support for all its branches, along with the very enterprise driven customer service strategies, the overall performance of the company was dramatically improved by 1998. all the branch include star, gulder, legend extra stout, stout, maltina and Amstel and a range of soft drinks – Schweppes companies (Heineken Technical service ) Bv premiums beverages international, B.V. Amstel Bro. Uwerijen shares). It also invested in right selection, training and motivation of its staff as well as improving the quality of its brand and substantially lunching itself into he new technological sphere in brewery industry.
The significant rise in profit after tax of the company from N1.7 billion between 1997 and 2001 is a reflection of the fact that global connectivity through partnering and networking infects dynamic sources of industrial rejuvanation , with the necessary re-engineering of operation through innovation, right management and networking, the firms emerged as a success string in Nigeria.
1.2 Statement of Problem
The business environment is fast changing competitions emerging derby business decisions and action becoming more risky as the market demands and needs are fluctuation daily external force is forcing many business organization to move outward through innovation.
Firms, in the presence of these circumstances have to survive and grow or die prematurely. Given the rapid change on taste, technology and competition, it become risky for a company to rely on its existing product. This is so dynamic, customers want and expect new and adversely unfavorable to Nigeria Breweries plc if it fails to apply adequate attention to it. Nigerian Breweries Company will branch a new product today tomorrow if they discover that rival firms having flooded the market with similar product satisfying the same needs.
This is a result of the reason why maltina sip-it was introduced to capture a sector of drink market and also respond to the major activities of the major competitors just as they suggest; sip- is for convenient carriage. What you can take at interval without necessary gulling the liquid at a time. Maltina sip-it is a modification of maltina drink in the bottle. It was made to satisfy customers who needed to quench their taste anytime anywhere of which maltina sip- it was now put in a disposal pack for easy carriage the basic aim of the business organization is to constantly satisfy the needs and wants of its customer in the face of all these constraints by coming up with new product, service and idea. Hence the mission statement of Nigeria Breweries plc read to be leading beverage in Nigeria marketing consumer satisfaction in an environmentally friendly ways.
1.3 Objective of the Study
The objective of the study is to examine the impact of product innovation on the growth of the organization. The specific Objectives are:
- To identify the impact of product innovation on the sales of Nigeria Breweries plcAwo- Ommama Owerri.
- To determine how product innovation improve on the profit of the organization
- To ascertain the level of consumer satisfaction.
1.4 Research Questions
The research would seek to address the following questions:
- What is responsible for product innovation in Nigeria Breweries plcAwo- Ommama Owerri?
- How does the firm source for strategic plan for new product?
- What are the short- term and long- term impact of product innovation to the organization?
1.5 Significance of the Study
Business organization justifies their economic and social existence to satisfy their respective customers through research on all the various brands of the different firms involved. It is a result of this fact and also due to time factor, finance and other constrains that this study will be delimited to the impacts of product innovation on the growth on Nigeria Breweries plc Awo- Ommama Oweri.
However, for the purpose of this study only the growth effects of innovating where held constant. The target audience comprises of consumers in Federal Polytechnic Nekede, Evan Enwerem University Eating outlet, supermarket, bar and management staff of Nigeria breweries plc and Awo-ommama Owerri.
1.6 Scope of the Study
Numerous brewing industries in various countries al over the world are involved in the innovation of their various consumers product. In the same vein, quitted a number of firms are concerned with the innovation of their various product brands. Most of these firms are basically similar in their mode of operation. It would be impractical an practically impossible to conduct a places gathering information. But the fact that the researcher was faced with all these the research work became a successful one.
1.7 Limitation of the Study
The researcher encountered some challenges in the course of conducting the research. Some of the challenges arose from the academic workload.
Also, inconsistency and unresponsiveness of some of the respondents who are illustrates financial commitment of transportation to various places gathering information.
1.8 Definition of Terms:
In a bad stat of repair failing to pieces.
The process of making changes introducing new ideas, methods, techniques etc.
It is a human activity directed toward satisfaction of wants and needs through exchange means.
A closely liked group of companies part in an n activity with another or other, especially one of the owners of the business.
To make something look new in the market.
Summary, Conclusion and Recommendations
This research brings to light some of the benefits of product innovation, which can be regarded as organization’s survival strategy. Product innovation can be described as a situation where product is improved upon to meet the ever-changing needs of consumers, organizational turnover and profit. An “old” product can be placed as a “new” product in the market after making some minor changes .On the other hand, an entirely new product can also be introduced into the market as a result of research findings. Most technology based firm innovations are mostly technology-driven contrary to market-driven technology, which is stimulated by the consumers’ needs.
Products like any other living beings undergo a normal lifecycle and at every stage of the life cycle, the product experiences some changes in the demand for them. Product innovation can be also be carried out on product already in the market. Also, the research outlines that the firm could achieve its short-term and long-term objective through product innovation which would enhance increase in sales, profit maximization and consumers’ satisfaction.
In this research paper, the impact of product innovation on the growth of manufacturing firm was examined. The background has revealed that most products require innovation due to constant changes in the taste of consumers and the need for firm to increase sales and maximized profit.
It appears that philosophy of marketing concept is yet to be taken seriously, most firms reckon with this concept in practice. In the practical sense, the needs and wants of the consumers are satisfied through the firm’s product(s). For a product to meet these objectives of satisfactions, it must undergo product innovation at regular intervals because of the dynamic nature of consumer’s needs and wants that changes over time.
The idea behind product innovation does not end in the satisfaction of changing taste of the consumers, this aspect of product innovation also helps the firm to have an edge over competing products in terms of sales. Sales would increase over time because more consumers would be attracted to the new product. Not only would these, product innovation enhance the attainment of profit maximization to the firm as a result of increase in turnover. The rate at which consumers patronize such product has facilitated profit maximization.
Finally, it is worthy to note that product innovation is not limited to once in a product’s lifetime. A product can be innovated as many times as possible. This aspect of product innovation is mostly done on consumers’ goods. This is so because the cost in carrying out product innovation on consumers good is not that high as the amount that will be spent in carrying out innovation on industrial goods.
Having undertaken a thorough study of the impact of product innovation on the growth of manufacturing firm, it is deemed necessary to give some useful suggestions and recommendations, which would help in improving the quality of consumer goods and improving the satisfaction of consumers. The recommendations are as follows:
- Firms should engage in extensive research, to find out the actual needs of the consumers in relation to what should be produced. This would go a long way in preventing the production of products which are not actually needed because of its failure to satisfy the needs and wants of the consumers;
- In addition, firms should carry our research on the changing taste of the consumers periodically so as to adjust the already existing
product, to meet the dynamic taste of consumers because failure to do so would reduce the product sales and profit;
- Since product innovation helps in reducing cost of consumer goods, Nigeria Breweries plc Awo- Ommama Owerri management should engage in it at regular interval so as to cut down the cost of value analysis strategy which is segment of product innovation;
- Management of Nigeria Breweries plc Awo- Ommama Owerri should ensure that Research and Development Department as well as feedback of consumers from sales personnel where new product strategic plan emanated from should be explored and made use of so as to enhance provision of products that are expected by consumers. Such report includes that from sales persons who are always in touch with the consumers and understand most of the competing products and in addition they know the position of their firm’s product in terms of competition in the market;
- Finally, in carrying out product innovation, management of Nigeria Breweries plc Awo- Ommama Owerri should ensure that the “new” product is real improvement on the old one. Consumers should not just be deceived that a product quality has improved while in the actual sense, there is no alteration on the product.
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