Segmentation in Manufacturing and Service Industry: a Key to Profitability

Abstract

The aim of this study was to assess the segmentation practices of furniture manufacturing businesses. A survey of sixty registered furniture manufacturers was carried out in Meru North District. The general objective of this study was to find out how furniture manufacturers determine customers for their products. During this study, primary data was collected from Maua Municipality and its environments using structured, semi structured questionnaires and direct observations was used. The study looked at the nature of segmentation practices variables commonly used in segmenting the market, effects of current practices on these manufacturer‟s businesses and sort options on how segmentation could be improved. Data analysis was done using Microsoft excel computer packages. Information was presented through bar charts, percentages tables and pie charts This research reveal that more than half of the respondents (53%) segment their market and produce specific items for specific customers. this helps them make more profits and allocate their resources. Those (47%) who did not segment their market thought it was not important. The variables used were income social class and institutions. Majority (60%) of the respondents said it was important to give the customers what they wanted.he study concluded that majority of furniture manufacturers are aware of segmentation practices. Their main source of furniture raw materials were wholesalers and retailers who obtained timber from Nyambene Forest and its environment, which has caused destruction to the forest The study recommends that the government through financial institutions should give the furniture manufacturers financial support since these businesses contribute greatly to Kenyan economy, reduce poverty and offer employment. Government needs to put emphasis on their training and offer financial support because furniture manufacturing creates jobs and supports the economy.