Market Orientation and Financial Performance (An Empirical Study on Tea Exporters in Tea Export Industry in Sri Lanka

Abstract

This study aims to examine the effect of market orientation on financial performance in relation to Sri Lanka Tea export industry. The problem of the study is “Is the variation of the Market Orientation (MO) reflected in the Financial Performance (FP) of the exporters in Sri Lankan Tea Export Industry?”. The objective of the study is to examine the reflection of market orientation on financial performance. Under methodology, this study follows deductive research approach. Research strategies are both primary (Survey by administering a formal questionnaire for 100 executives/managers in tea export companies) and in-depth interview for 5 industry specialists) and secondary sources to collect and gather data.The Rationale of selecting 100 executives and managers from 20 tea exporting companies is to represent largest tea exporters in the sample for collecting a wider, in-depth data and feedback from this sample.With the analysis of study findings, Literature survey shows the relationship between market orientation and organization performance under different context. According to formal survey, the study found that there is a reflection and relationship between market orientation and financial performance of tea export companies. Correlation coefficient is 0.556 and it shows the high positive relationship between the customer orientation and financial performance of tea exporters in Sri Lanka. Weak positive relationship was found between the competitor orientation, the interfunctional coordination and financial performance of tea export in Sri Lanka. In addition to this, with the analysis of overall impact of market orientation on financial performance, there is a moderate impact of market orientation on financial performance of tea exporting companies, Sri Lanka. This study found that main strategies of tea exporters in Sri Lanka are value addition, Brand development, product development, mutual agreements with the customers, packaging, product promotion, product innovation, quality improvement, cost reduction of tea, new products development, research& development iniaititves,product diffrenciation,Producer owned ethical tea brand,Nichi marketing, strategic partnership, fair trade concept of tea exporting etc. In addition to above, it is concluded that customer has become the strategic factor in the business and formulation of customer oriented tea product is crucial for the business sustainability.