INFLUENCE OF SUPPLIER RELATIONSHIP MANAGEMENT ON PROCUREMENT PERFORMANCE IN FAST MOVING CONSUMER GOODS MANUFACTURING FIRMS IN NAIROBI CITY COUNTY, KENYA
Abstract
The purpose of the study was to establish the influence of supplier relationship management on procurement performance in fast moving consumer goods manufacturing firms in Nairobi City County. The study applied descriptive research design. The target population of the study was 225 supply chain officers of the fast moving consumer goods firms in Nairobi City County. Data was collected using Stratified Random Sampling[JG1] [JG2] by answering of questionnaires both quantitatively and qualitatively. The findings were analyzed using both descriptive and inferential statistics. This was by using statistical package for social sciences version for presentation of the processed data. The inferential statistics (correlation and regression analysis) was used to show the relationship of the independent variables and dependent variable at 5% level of significance. It was notable that there exists a relationship between independent variables and dependent variable with a correlation coefficient of 0.833. The coefficient of determination was between zero and one. The data showed that the high R square was 0.694. It showed that the independent variables in the study were able to explain 69.40% variation in the procurement performance in the fast moving consumer goods manufacturing firms while the remaining 30.60% was explained by the variables or other aspects outside the model. This implied that these variables were very significant and they therefore need to be considered in any effort to boost procurement performance in the fast moving consumer goods manufacturing firms. The study recommended that there was need to have supplier collaboration integrated with the service providers, strategic alliances and partnership with the suppliers as it frees management time and reduces staff costs as well as giving organization flexibility.The firms should embrace supplier contracting with flexible contracting period for reduction of costs in the organization.There was need to have manufacturer/supplier relationship and have strong structural bonds with the suppliers for cost reduction and timely delivery of goods. The firms should have adequate technical support to the suppliers to increase order fulfilment. The firms should have a check for a training program to enhance quality of procured goods. The firms should use an approved list that can enable improvement in cost reduction. The firms need to enhance the use of supplier incentives and supplier trainings for a continuous improvement program to enhance order fulfillment.
Key Words: Supplier Contracting, Supplier Collaboration, Manufacturer / Supplier Integration, Supplier Development, Procurement Performance
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DOI: http://dx.doi.org/10.61426/sjbcm.v5i1.653
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