• Lamburira Chisulo University of Malawi


Purpose of the Study: The purpose of the study was to examine whether cost reduction strategy influence performance of tea industry in Mulanje region.

Statement of the Problem: In Mulanje region, there has been uprooting of tea bushes, tea picking boycotts, destruction of factory infrastructure besides threatening the life of factory managers in Mulanje region once the bonuses are announced year after year. Moreover, the low earnings have threatened the envisaged leading position of tea industry in employment creation of tea, income generation and foreign exchange earnings, in Vision, 2030. Against this backdrop there is need to identify significant strategic approaches needed in the management of the entire tea industry to reverse the situation. Despite the key role played by the tea sector, this sector has been under threat due to ever escalating costs of production in terms of labour costs, energy costs, and even heavy taxation imposed to it.

Study Methodology: The study adopted descriptive research design. The target population was   117 management team comprised of five regional management team ; regional accountant, operations manager, production manager, auditor, and 112 top management in 16 factories who include, 16 manager 16 production managers 32 accountants 32 training managers and 16 field coordinators sixteen factories that lie in Mulanje region.

Study Results:  Correlation results revealed that there was a strong positive association between cost reduction strategy and performance of tea industry (r=.820). The results showed cost reduction strategy was significant with performance of tea industry since the p-value is less than 0.05 (p=0.000). Regression results showed that there was a strong positive relationship between cost reduction strategy and financial performance of the tea industry (r=.978).

Conclusion: The study concluded that cost reduction strategy influence performance of tea industry in Mulanje region in Malawi positively.

Policy Recommendation: The study recommended that the Tea Association of Malawi should pursue a strategy to provide incentives intended for technology transfer from advanced economies in order to get better prices in the world market.

Key Words: Cost, Reduction, Strategy, Performance

Author Biography

Lamburira Chisulo, University of Malawi

PhD Candidate, University of Malawi


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How to Cite
Chisulo, L. (2019). INFLUENCE OF COST REDUCTION STRATEGY ON PERFORMANCE OF TEA INDUSTRY IN MULANJE REGION. African Journal of Emerging Issues, 1(1), 68 - 93. Retrieved from