An evaluation of the impact of an acquisition strategy on competitive advantage: A case study of OK Zimbabwe

Abstract

OK Zimbabwe Limited was incorporated in 1953 and listed on the Zimbabwe Stock Exchange (ZSE) in 2001. The company is a leading supermarket retailer, providing access to a diverse range of retail products and allied services in Zimbabwe. It currently has 54 stores nationwide trading under three highly recognized brand names; OK, Bon Marche, and OK mart.The supermarket retail industry is constantly transformed by changes such as legislation, consumer tastes, technological developments and macroeconomic challenges in the form of liquidity crises. The level of increased competition is a constant threat to market share retention and expansion.The major challenge faced by OK Zimbabwe is how to defend and consolidate its position as the leader in the supermarket retail sector.

The dissertation was a case study of the acquisition strategy adopted by OK Zimbabwe Limited, and its effect on the acquirer’s business model, growth and competitive position. Literature pertaining to underlying concepts was reviewed and covered aspects of strategy, business models and competitive advantage. The strategic aspect highlighted the classification, motives, drivers, attractiveness and pitfalls of acquisitions. This was linked to business model, performance and competitive advantage .The final part dwelt on how these outcomes are evaluated and their overall implications on success.The methodology framework used was predominantly quantitative, with a deductive research approach .A self-administered questionnaire based on management and employee assessments was the instrument used to collect primary data. The conceptual model was statistically tested and analysed to support the findings. The objective of the research was to establish the impact of strategy on competitive advantage, extend the current knowledge and establish important management lessons .The findings showed that the acquisition strategy significantly contributed to competitive advantage. A major finding was that economic performance was not the major contributor to growth. Two managerial recommendations were also included to exploit other sources of competitive advantage.