INFLUENCE OF INVENTORY MANAGEMENT PRACTICES ON PERFORMANCE OF FLOUR MANUFACTURING FIRMS IN NAIROBI KENYA
Abstract
The purpose of this study was to establish the influence of inventory management practices on performance of flour manufacturing firms in Nairobi Kenya. The specific objectives of the study were: To find out how inventory management technique influence performance of flour manufacturing firms and to establish how the inventory management systems influence performance of flour manufacturing firms. The researcher used descriptive research method. The study used structured questionnaire in collection of data. The study adopted stratified random sampling while simple random sampling was used to identify respondents within the strata. The population was 220 and the exact sample size was 140. The study employed a regression model as well as descriptive statistics that were presented in percentages, means, standard deviations, and frequencies. The study conducted a multiple regression analysis to determine the relationship between variable of the study and firm performance. The study presented the findings in form of frequency tables and figures. Results revealed that inventory management practices influences firm performance in flour manufacturing firms in Nairobi Kenya positively. The results showed a positive and significant correlation between firm performance and inventory management practices in the flour firms. From the findings, the study revealed that inventory management techniques affects firm performance in a positive manner. Moreover, the study showed that inventory management systems had impact on firm performance. The study recommended that when inventory is mismanaged, leads to unnecessary expenditure in the working capital. Proper inventory management practices reduce storage capital. Additionally, obsolescence and waste of products are reduced. Consequently, organizational profits increase. Such approach leads to improved customer satisfaction. Therefore the adoption proper inventory management practices will lead to low operation cost thus improvement of the performance of the flour manufacturing firms.
Key Words: Inventory Management Technique, Inventory Management Systems
CITATION: Mumo, G. M., & Moronge, M. (2019). Influence of inventory management practices on performance of flour manufacturing firms in Nairobi Kenya. The Strategic Journal of Business & Change Management, 6 (3), 331 – 342.
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DOI: http://dx.doi.org/10.61426/sjbcm.v6i3.1320
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