Asian Journal of Economics, Business and Accounting

Milk trading is a significant livelihood activity for people in pastoral regions. However, in Garissa and Tana River Counties, milk traders face significant performance challenges. Although research indicates that Ansoff growth strategies can help improve performance, most existing empirical studies reveal contextual, conceptual, methodological and theoretical gaps. Accordingly, this research addressed the identified gaps by assessing the influence of product development strategy on performance of micro-, small- and medium-sized milk trading enterprises in Garissa and Tana River Counties, Kenya. The study, anchored in the Ansoff Matrix Framework and the Balanced Scorecard Framework, adopted a pragmatist philosophy and a mixed-methods approach. It employed a cross-sectional explanatory research design. The target population comprised 270 milk traders, and a census approach was employed. Data were collected using structured questionnaires and an interview schedule. The instruments were pretested for reliability and validity. Descriptive and inferential statistics were used to analyse quantitative data, while thematic analysis was used for qualitative data. Frequency tables and narratives were used to present the findings. The study revealed that product development strategy was a statistically significant predictor of performance of micro-, small- and medium-sized milk trading enterprises in Garissa and Tana River Counties, Kenya (R² = 0.6118, B = 0.303, β = 0.247; p = .001). The key informant interviews reinforced the quantitative findings in indicating that infrastructure development and institutional support were associated with improved performance among dairy MSMEs. The study recommends investment in product innovation. The study contributes to the evidence base for developing the milk sector in Garissa and Tana River Counties by providing empirical evidence on adding value to milk products.