MICRO ENVIRONMENTAL FACTORS AND PERFORMANCE OF QUICK SERVICE RESTAURANT IN PORT HARCOURT

ABSTRACT

The broad objective of this study is to examine micro environmental factors and performance of quick service restaurant in Port Harcourt. The study adopted the survey descriptive research design and with the aid of convenience sampling method, the researcher purposively selected thirty-six (36) participant who are managers and staff quick service restaurant in Port Harcourt as the respondent for the study. Self- structure questionnaire was issued to the respondent of which thirty (30) was retrieved and validated for the study. Data was analyzed using simple percentage, presented in frequencies and tables. Findings from the study revealed that micro environmental factors such as low influx of customers, presence of foreign competitor fast foods, poor customer services shallow dressed staffs and non-strategic location will have a significant impact on the performance of quick service restaurant in Port Harcourt. . The study therefore, recommends reconsideration of such environmental factors that impose unnecessary constraints on businesses in Nigeria. Specifically, multiple tax system should be jettisoned; exchange rate stability should be pursued; the passage of Freedom of Information Bill into law should be hastened; infrastructure, especially electricity, should be strengthened. Businesses should minimize their weaknesses by paradigm shift from internal factors that weaken management inefficiencies.

CHAPTER ONE

INTRODUCTION

1. Background of the study

Business organization does not operate in vacuum but it operates in business environment where there is production and distribution of goods and services. Business environment is the summation of all outside and interior conditions and influences that influence the presence, development and advancement of business. Business environment in which organization operates exerts pressure on them the pressures from the environment provoke different responses as organization seeks legitimacy in order to survive and prosper in the environment. Environment of any organization is dynamic in nature due to the forces that operates in it as a result; managerial activities could not be operated freely. The environment of any organization is the aggregate of all conditions, events and influences that surround and affect it, ( Davis, 1975).The environment is a major source of uncertainty to a business manager and as such both influences the design of any organization and the configuration of any organizational structure, therefore, without a thorough analysis of the environment, a manager finds it almost impossible to make important operational decisions in his organization, which are essential in the attainment of various business objectives. Organization of every dimension both formal and inform al operates in an identifiable environment.

Oginni and Adesanya (2013) noted that business environment can be divided into internal environmental factors and external environmental factors. The internal business environment refers to the internal elements that influence how operations are conducted and how successful they are. The owners, board of directors, workers, the organization’s culture, the physical workspace, and all departments that make up the organization are all part of the business’ internal environment (the organizational structure). Hans (2018) categorized the internal environment as: Organisational Culture, Organisational Direction, Mission and Objectives, Management Structure and Nature, Human Resources and other Miscellaneous factors which include: (a) the firm’s business intelligence, (b) the company’s brand image and brand equity, physical assets and facilities, research and technical skills, and marketing resources among others.

On the order hand, the external business environment includes both macro and micro environment. The microenvironment, also known as the task environment, refers to the forces that influence an organization’s operation in its immediate surroundings. Micro variables do not impact all businesses in a given industry in the same way. It includes the following elements: customers, competitors, suppliers, marketing middlemen, the general public, financiers, regulators, and strategic partners (Kattookaran, 2016). A business and its microenvironment are part of a larger macro environment. This macro environment offers opportunities while also posing risks to a company. The macro forces are generally more uncontrollable, and a company’s success is determined by its ability to adapt to the environment. The following elements make up a firm’s macro environment: economic environment, political environment, technical environment, social environment, legal environment, cultural environment, and labor environment (Kattookaran, 2016).

Consequently, the impact of the business environment on enterprises varies depending on the economic situation of the country or region (Ng & Kee, 2012). In particular, when the business environment in industrialized countries is stable, enterprises are plainly better off. Howbeit, there is need for SMEs to mitigate the effects of business environment on their businesses is of great importance.

1.2 Statement of the Problem

Food is a necessity and this has made the restaurant business lucrative yet competitive (Hughes,2016). The restaurant business is of special importance from a business environment perspective due to emerging competitive trend and the relevance of the industry to customers (Mojekwu, Rahim, & Ighomereho, 2016). The influx of foreign eateries; KFC, Double four, Chinese eateries, etc into Portharcourt and in Nigeria at large, has triggered the need for quick service restaurant to tackle micro environmental factors in order to survive, gain a prime place in the competitive space and improve business performance (Ogunde,2012). Olalekan, (2019) agrees that this is because the micro-environment is basically the environment that has a direct impact on the business. It is related to the particular area where your company operates and can directly affect all of your business processes which includes customers, suppliers, resellers, competitors, and the general public.

Consequently, preliminary studies on the mobile marketing efforts of restaurant in that, most restaurant are performing below customers’ expectations as the case of road side food vendors, quick fix restaurant and other Nigerian Fast food like Mr. Biggs leading to them packing up. While Osuagwu, (2006) opined that the low performance of the restaurant could be attributed to their orientation towards mobile marketing strategies, Olalekan, (2019) argued that poor performance by quick-fix restaurant is factored by microeconomic business factors such as low influx of customers, poor customer services, shallow dressed staffs and location, foreign competitors, and suppliers. While these are two sides of same coin, the researcher therefore, upon the backdrop seeks to micro environmental factors and performance of quick service restaurant in Port Harcourt.

1.3 Objective of the Study

The broad objective of this study is to examine micro environmental factors and performance of quick service restaurant in Port Harcourt. Specifically, the study will:

1. Determine whether low influx of customers has any effect on the performance of quick service restaurant in Port Harcourt.
2. Ascertain whether the presence of foreign competitor fast foods can affect the performance of quick service restaurant in Port Harcourt.
3. Investigate if poor customer services can affect the performance of quick service restaurant in Port Harcourt.
4. Examine whether shallow dressed staffs and location would have significant impact on the performance of quick service restaurant in Port Harcourt.

1.4 Research Question

1. Does low influx of customers has any effect on the performance of quick service restaurant in Port Harcourt?
2. Does the presence of foreign competitor fast foods can affect the performance of quick service restaurant in Port Harcourt?
3. Does poor customer services have any effect the performance of quick service restaurant in Port Harcourt?
4. Does shallow dressed staffs and non-strategic location factor would have significant impact on the performance of quick service restaurant in Port Harcourt?

1.5 Significance of the Study

Findings of the study will be of significance to manager of SME’s quick service restaurants and theoretically contribute to existing literature. To manager of SME’s quick service restaurants it will reveal the the need for SMEs to mitigate the effects of business environment on their businesses is of great importance. Findings of the study will contribute to the general body of knowledge. This research will be a useful point of reference and consultation to other students who may want to carry out a research on the same topic

1.6 Scope of the Study

The scope of this study is to examine micro environmental factors and performance of quick service restaurant in Port Harcourt.

1.7 Limitation of the Study

Like in every human endeavour, the researchers encountered slight constraints while carrying out the study. The significant constraint was the scantiness of literature on formal education on community development. Thus much time and organization was required in sourcing for the materials and literature that will be relevant to study as well in the process of data collection. Also the study is limited in sample size and geography covering only restaurant businesses in Portharcourt. Therefore findings of this study cannot be used for generalization in other eateries or restaurant outside Portharcour this therefore creates a gap for further studies.