The study focused on the effect of backward integration strategy on organization performance. Nestle Nigeria Plc was used as case study. Fifty copies of questionnaires were administered using convenience sampling techniques for the purpose of data collection and interviews were conducted to authenticate the information derived. The data obtained was analysed using frequency distribution and chi-square. The findings revealed that Backward Integration increases organization profitability. This is to say that Backward Integration strategy streamline the organization to provide better cost control by eliminating the middleman and lower cost of production for the firm to became more competitive in the market place. It was recommend among others that to justify the funds expended on this strategy, the strategy should be well validated and evaluated. While it is proper that research and development programme should be embanked upon.                              



Title page                                                                 i      

Certification                                                             ii

Dedication                                                                        iii

Acknowledgement                                                     iv

Abstract                                                                    vi

Table of content                                                               vii



1.1   Historical Background of  Nestle Nigeira  Plc    1  

1.2   Statement of  research problems                               4 

1.3   Objectives of the study                                    5

1.4   Statement of Research questions                              6

1.5   Statements of research hypotheses                   6

1.6   Significance of the study                                  7

1.7   Scope and Limitations of the study                   7

1.8   Operational  Definition of terms                                8



2.1   Introduction                                                     9

2.2   Historical background of strategy                              14

2.3   Theoretical frame work                                             15

2.3.1 The classical theory of strategy                                16

2.3.2 The evolution theory of strategy                               16  

2.3.3 The proccessual  theory of strategy                  17  

2.3.4 Systemic  theory of strategy                                     18

2.4   Backward integration strategy                           19  

2.5   Problems of benefits of backward integration strategy23  



3.1   Introduction                                                    48

3.2   Research design                                                        48

3.3   Characteristics of population of the study         49

3.4   Sample size and sampling design                               49  

3.5   Re statement of research questions                   50           

3.5   Re-statement of research hypotheses                        50  

3.6   Analytical tools                                                         51

3.7   Test of validity  and reliability  of research instrument52



4.1   Introduction                                                     53

4.2   Frequency table                                                        53  

4.3   Chi-square                                                        67  



5.1   Summary of findings                                         74 

5.2   Conclusion                                                               75

5.3   Recommendations                                            75

5.4   Limitations                                                               76

        Bibliography                                                     77

        Appendix                                                          81



Nestle Nigeria plc is associated with the nestle group, the single largest food company in the world and it is known worldwide for its top quality products.

Nestle Nigeria plc began simple trading in 1961 and has today grown into a leading manufacturing and marketing company. It is a public quoted company listed since 1978 on the Nigeria stock exchange with about 20,500 shareholders participating.

Nestle Nigeria Plc of Switzerland owns about 43% of the company’s equity. Nestle Nigeria plc manufacturing complex is located at Agbara Industrial Estate in Ogun State.

The main products were designed in line with modern manufacturing methods which ensure efficient production of the following:

v Infant cereals – nestle golden morn.

v Instant family cereals, nestle milo – beverage drink.

v Chocomilo – chocolate sweets, maggi cubes, maggi chicken, maggi crayfish, maggi super onion spices.

Nestle Nigeria plc obtains most of its agricultural raw materials locally from contract farmers and out growers in partnering agreement that enables the benefits from the technical advice and assistance of the company’s agricultural services department and at the same time, guarantee to the company continuous supply of raw materials that meet their high quality standards.

The company pursue the use of backward integration strategy by pursuing its sustainable agricultural initiative(SAI) where she involve herself with collaborative research with the university of agriculture, Abeokuta(UAAB) of popularisation of soya beans which brought into being the a selection of soya beans varieties with improved seed colour, seed size, and seed yield.

The company’s objective is to satisfy the requirements of the consumers with high quality food products with long shelf life adapted to the taste and food habits of the consumers and as a result, she has continuously invested in Nigeria by building and commissioning in 1991 at agbara, ogun state a fully integrated plant producing concentrated sorghum malt extract from locally malted sorghum, and in June 1995, Nestle Nigeria plc commissioned another plant at agbara which produces enzymatic hydrolyzed plant protein mix.(EHPPM).

The investments represent successful and significant effort at replacing imported raw materials in the manufacture of milo food drink and the maggi range seasonings.

The company being conscious of her social responsibility is committed to environmental policies, programmes, and practices into each business as an element of management in all functions. She always thrives to minimize the impact of her environment through the utilization of packaging and manufacturing process that are internationally recognized to have a minimum impact on the environment.

With her historical root in nutrition, wide product portfolio, strong brands, research and development competence, skilled and motivated professionals, and efficient management, the company is positioned to committed to the progress, prosperity, economic development, and industrial growth of Nigeria.

Through the use of vertical integration strategy, the company seeks to achieve a clear cut competitive advantage over competitive products by ensuring that their products are available wherever, whenever, and however the consumers want their continuous attention is also given to developing the professional leadership skills of staffs at all levels so that they can directly contribute to growth and a higher level of performance.

To stimulate industrial growth, the company has a policy of long term sustainability business practice. Over 75% of their raw materials are sourced locally by their selves through the use of employed farmers and suppliers and also support an ever increasing standard of living through employment generation, increased income, infrastructure improvements, and a growing concern for the interest of the community here in Nigeria through the application of the nestle environmental management (NEM) and complies with applicable environmental legislation.


In this twenty first century, the world is a global market (Diacon, 2003) characterized by competitiveness where a firm has to compete against another firm all over the world. Backward integration strategy has helped to identify the things that need to be done, gives idea, redefined by experience, as to how they should be done and achieve competitive advantage for the organization.

Backward integration strategy is known and accepted as the process by which a firm takes ownership or increased control of its supply system. It serves to streamline the organization to provide better cost controls, and to eliminate the middleman, because of efficiency and lowered cost of production as it is possible for the firm to become more competitive in the market place.

Although backward integration strategy improves organizations performance, but there are still doubts on the assertions that backward integration strategy is more applicable to manufacturing firms as compare to service companies. Therefore, the assertions can be made to the followings:

v Managing employees’ performance as an integral part of the work.

v Quality metrics that were not focused on customers.

v The effect of contraction in output that slackening global demand is generating.

v Lack of availability of skilled workforce.


The objective of this research study includes the following:

v To compose manufacturing industry to the usefulness of Backward integration strategy as designing a management policy that documents the expectations of individual and organizational which provides a meaningful process by which employees can be rewarded for noteworthy contributions to the organization and also provide a mechanism to improve individual/organizational performance as necessary.

v To ensure that industries, especially the manufacturing ones sees the usefulness of Backward integration strategy and how it can help in maximizing the net profit of the organization which is achievable by strategizing very simple strategies for both product lines and production processes as per making difficult decisions to cutting costs quickly and cheaply to avoid repeated morale sapping cuts.

v To make sure that manufacturers are alerts to opportunities for expansions as valuation drops when owners look for quick exits. Research and marketing may also be the key, enabling strong positioning to take advantage of the future upturn.

v To provide suggestions and recommendations on the effect of backward integration strategy on organizational performance and also make appropriate recommendations for future researches on the area of its specialization.


v What effect does backward integration has on organizational performance in manufacturing industries?

v How do manufacturers key into the need of the growing market through integration strategy?

v Is backward integration strategy and organizational performance related to growth and profitability?

v Does backward integration strategy focuses on customers’ satisfaction?


H0      :       Backward integration strategy does                                                                                               

not have significant effect on organization’s performance.

H1      :       Backward integration strategy have significant

effect organization’s performance.

H0      :       Backward integration strategy is the same as                           organization’s growth and expansion.

H1      :       Backward integration strategy is not the same as     organization’s        growth and expansion.

H0      :       Backward integration strategy increases an

Organization’s  profitability.

H1      :       Backward integration strategy does not increases

an organization’s profitability.


A study of this kind is expected to make theoretical and practical contributions to the manufacturing industries. This study provides a basis for closer scrutinizing of the formulations and application of backward integration strategy in use.

The study is likely useful for department of interior rating officials to assist with the management performance that is aligned with and in support of the organizational goals. (project topics   final year project topics and research materials )

Manufacturing industries, services and professional industries that are constantly looking for competitive strategies and individuals can benefit from the study as it enhances organizational performance.


This study wants to look at the effect of backward integration strategy and organizational performance.

However, it shall be limited to manufacturing firms in ogun state alone (nestle Nigeria plc). The reason for the limiting this study to manufacturing firms is because their actions have tremendous effect on the national economy.

The study will therefore be restricted to manufacturing sector and whose ownership structure is strictly Nigerian.


Various terms are expected to be constantly used in this study. Some of them are briefly defined below:

INTEGRATION STRATEGY: This is the acceptance of a plan or a course of action which is of vital pervasive or continuing importance to the organization as a whole.

COMPETITIVE ADVANTAGE: This is the getting ahead of others by outsmarting them in the course of rivalry.

GROWTH: This is an expansion of the organization in one or more dimensions without changes in its structures and development as an innovative process leading to the structural transformation of the social system.

ORGANIZATION: This is a group of people working together to achieve a special purpose which cannot be achieved by an individual working alone.

PERFORMANCE: The action of carrying out or complete an action or function.

DEVELOPMENT: The quantity of changes in the process of production which shall be slow at the initial, but will later increased over a long period of time.

IMPLEMENTATION: The process of putting a plan into action.


Click Here To Get The Complete Project »

How To Write Chapter Three Of Your Research Project (Research Methodology)

  • Methodology In Research Paper

    Chapter three of the research project or the research methodology is another significant part of the research project writing. In developing the chapter three of the research project, you state the purpose of research, research method you wish to adopt, the instruments to be used, where you will collect your data, types of data collection, and how you collected it.

    This chapter explains the different methods to be used in the research project. Here you mention the procedures and strategies you will employ in the study such as research design, study design in research, research area (area of the study), the population of the study, etc. You also tell the reader your research design methods, why you chose a particular method, method of analysis, how you planned to analyze your data.

    Your methodology should be written in a simple language such that other researchers can follow the method and arrive at the same conclusion or findings.

    You can choose a survey design when you want to survey a particular location or behavior by administering instruments such as structured questionnaires, interviews, or experimental; if you intend manipulating some variables.

    The purpose of chapter three (research methodology) is to give an experienced investigator enough information to replicate the study. Some supervisors do not understand this and require students to write what is in effect, a textbook.

    A research design is used to structure the research and to show how all of the major parts of the research project, including the sample, measures, and methods of assignment, work together to address the central research questions in the study. The chapter three should begin with a paragraph reiterating the purpose of research. It is very important that before choosing design methods try and ask yourself the following questions: Will I generate enough information that will help me to solve the research problem by adopting this method?

    Method vs Methodology

    I think the most appropriate in methods versus methodology is to think in terms of their inter-connectedness and relationship between both. You should not beging thinking so much about research methods without thinking of developing a research methodology.

    Metodologia or methodology is the consideration of your research objectives and the most effective method and approach to meet those objectives. That is to say that methodology in research paper is the first step in planning a research project work.

    Design Methodology: Methodological Approach

    Example of methodology in research paper, you are attempting to identify the influence of personality on a road accident, you may wish to look at different personality types, you may also look at accident records from the FRSC, you may also wish to look at the personality of drivers that are accident victims, once you adopt this method, you are already doing a survey, and that becomes your metodologia or methodology.

    Your methodology should aim to provide you with the information to allow you to come to some conclusions about the personalities that are susceptible to a road accident or those personality types that are likely to have a road accident.

    The following subjects may or may not be in the order required by a particular institution of higher education, but all of the subjects constitute a defensible in metodologia or methodology chapter.

    Click here to complete this article - How To Write Chapter Three Of Your Research Project (Research Methodology)


Please feel free to carefully review some written and captured responses from our satisfied clients.

  • "I love what you guys are doing, your material guided me well through my research. Thank you for helping me achieve academic success."

    Sampson, University of Nigeria, Nsukka.
  • "researchwap.com is God-sent! I got good grades in my seminar and project with the help of your service, thank you soooooo much."

    Cynthia, Akwa Ibom State University .
  • "Sorry, it was in my spam folder all along, I should have looked it up properly first. Please keep up the good work, your team is quite commited. Am grateful...I will certainly refer my friends too."

    Elizabeth, Obafemi Awolowo University
  • "Am happy the defense went well, thanks to your articles. I may not be able to express how grateful I am for all your assistance, but on my honour, I owe you guys a good number of referrals. Thank you once again."

    Ali Olanrewaju, Lagos State University.
  • "My Dear Researchwap, initially I never believed one can actually do honest business transactions with Nigerians online until i stumbled into your website. You have broken a new legacy of record as far as am concerned. Keep up the good work!"

    Willie Ekereobong, University of Port Harcourt.
  • "WOW, SO IT'S TRUE??!! I can't believe I got this quality work for just 3k...I thought it was scam ooo. I wouldn't mind if it goes for over 5k, its worth it. Thank you!"

    Theressa, Igbinedion University.
  • "I did not see my project topic on your website so I decided to call your customer care number, the attention I got was epic! I got help from the beginning to the end of my project in just 3 days, they even taught me how to defend my project and I got a 'B' at the end. Thank you so much researchwap.com, infact, I owe my graduating well today to you guys...."

    Joseph, Abia state Polytechnic.
  • "My friend told me about ResearchWap website, I doubted her until I saw her receive her full project in less than 15 miniutes, I tried mine too and got it same, right now, am telling everyone in my school about researchwap.com, no one has to suffer any more writing their project. Thank you for making life easy for me and my fellow students... Keep up the good work"

    Christiana, Landmark University .
  • "I wish I knew you guys when I wrote my first degree project, it took so much time and effort then. Now, with just a click of a button, I got my complete project in less than 15 minutes. You guys are too amazing!."

    Musa, Federal University of Technology Minna
  • "I was scared at first when I saw your website but I decided to risk my last 3k and surprisingly I got my complete project in my email box instantly. This is so nice!!!."

    Ali Obafemi, Ibrahim Badamasi Babangida University, Niger State.
  • To contribute to our success story, send us a feedback or please kindly call 2348037664978.
    Then your comment and contact will be published here also with your consent.

    Thank you for choosing researchwap.com.