Procurement and Logistics

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    Supply chain capabilities and firm performance of Epz agro-processing firms in Nairobi metropolitan region, Kenya
    (Chuka University, 2025) Mwangi Esther Muthoni
    Agro-processing firms in Kenya, particularly those operating within the Export Processing Zones (EPZs), are strategically positioned to drive economic transformation through industrialization and value addition. To achieve this role, firms rely heavily on diverse supply chain capabilities that support efficiency and competitiveness. However, the interplay of supply chain visibility, logistics management, relational capability and supplier diversification often presents a dilemma in sustaining and advancing their competitive position. The study therefore examined the relationship between supply chain capabilities and firm performance of EPZ Agro-Processing firms in Nairobi Metropolitan, Kenya. Specifically, the research focused on determining the effects of supply chain visibility, logistics management capability and relational capability on firm performance, as well as the moderating effect of supplier diversification on the relationship between supply chain capabilities and firm performance. The study was anchored on the Transaction Cost Theory, Theory of Constraints and Social Exchange Theory. A descriptive cross sectional research design was adopted. The target population comprised 31 EPZ Agro-Processing firms located in Nairobi Metropolitan, and a census approach was used. Piloting was conducted on three firms selected randomly in Rift Valley region to test the validity of the instrument. Reliability was confirmed through Cronbach’s alpha coefficients. Data was collected using structured questionnaires with closed-ended questions measured on a five-point Likert scale. A total of 27 questionnaires were completed. Data analysis was conducted using the Statistical Package for Social Sciences (SPSS) Version 28, employing descriptive and inferential statistics, and hypothesis testing at a 5% significance level. Ordinary Least Squares (OLS) regression was used to test the direct relationships, while stepwise regression was applied to examine the moderating effect of supplier diversification. Descriptive statistics show that firms had relatively efficient supply chains which strengthen their competitive position. They were fairly effective in tracking goods in real time and maintaining better logistics practices through optimized delivery routes. The firms also sustained reasonably positive relationships with partners and had a fairly broad supplier base. In Inferential analysis, results show that supply chain visibility, logistics management and relational capability enhanced firm performance through efficiency, responsiveness and collaboration. Supplier diversification, however, did not significantly moderate these relationships, suggesting that firm performance is largely driven by supply chain capabilities rather than supplier base expansion. The study was limited by its cross-sectional design, which captured data at a single point in time and did not account for dynamic changes in supply chain capabilities and firm performance. The study recommends managers to strengthen visibility systems, invest in logistics infrastructure and foster long-term collaborative supplier relationships. Policymakers can amend and implement policies that support digital tracking technologies, logistics networks and collaborative platforms to enhance competitiveness in the EPZ Agroprocessing sector. For scholars, the study contributes empirical evidence and extends theoretical perspectives by linking supply chain capabilities to supplier diversification and firm performance in EPZ industry.
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    Effect of supply chain management practices on performance of food processing firms in Nairobi county, Kenya
    (Chuka University, 2022) Mayabi, Peres Linda
    The productivity of food processing firms in Kenya has been declining due to the use Supply Chain Management Practices which are not current. The food processing subsector performance has also been declining thus its contribution to the Gross Domestic Product has reduced to 10% thus leading to operation inefficiency. Even though a lot has been done to curb the problem of poor performance in these firms the problem has continued to be experienced. Therefore, there is need for a study to be done on the Supply Chain Management Practices that could help enhance the performance of food processing firms. The overall objective of this study was to probe the effect of supply chain management practices on performance of food processing firms in Nairobi County. It was steered by the specific objectives pertinent to Supply Chain Management Practices namely; information sharing practices, logistics management and inventory management on performance of food processing firms in Nairobi County. Firm size was used as a moderator variable. The study was premised on the Complexity Theory in Logistics, The Lean theory and Grey system theory. Descriptive design was espoused. A population of 172 food processing firms and a sample size of 120 firms was determined. Stratified and simple random sampling were used to pick specific firms while data were collected using structured questionnaires. Descriptive statistics aided in describing the primary characteristics of the data. The Pearson Product Moment Correlation was used to establish the correlation between the studies constructs. Regression analysis aided to ascertain the effect of Supply Chain Management Practices on performance of food processing firms with the aid of SPSS version 28. T-statistics were used to gauge the significance of individual objectives at 5% confidence level while F-statistics was used to establish the overall significance of the model. The study established a positive significant effect between information sharing practices and performance (regression coefficient 0.247, p-value 0.029). Further logistics management was found to be positively correlated to performance, (regression coefficient 0.372, p-value of 0.000). Inventory management had a regression coefficient of 0.492 and a p-value of 0.000 indicating it is significant. The interaction between firm size and supply chain management practices had a regression coefficient of 0.257 and a p-value of 0.124 .It had a t-statics of 4.751. The study concluded that information sharing practices, logistics management and inventory management had substantial impact on performance on Food processing firms and recommends that food processing firms to apply information sharing practices and logistics management in order to reduce on cost. On the other hand, inventory management was found to be insignificant therefore it does not affect performance. Firm size was found not to alter the nexus between Supply Chain Management Practices and performance. The study recommends that firms should invest more in information sharing platform such as the EDI to enhance free flow of information. Food processing firms should incorporate the aspect of vehicle routing and vehicle scheduling to reduce the transportation cost. Further the study recommends that firms should establish adequate quality control and quality monitoring points in order to get the best quality during the production. The government to implement SCMPs and strategies that encourage businesses to espouse prudent management strategies regarding inventory to boost revenue. Further research should be conducted in different contexts and other studies should be carried out for a longer period of time to track the changes over a period of time.
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    EFFECT OF LOGISTICS MANAGEMENT FUNCTIONS ON PERFORMANCE OF THIRD-PARTY LOGISTICS SERVICE PROVIDERS IN NAIROBI CITY COUNTY, KENYA
    (Chuka University, 2023-08) WEKESA TERRY
    Studies reveal that the total logistics cost of third-party has increased as a result, the number of logistics (3PL) firms dropped from 44% to 36% of effective logistics services management. However, the inefficient logistics management systems reduce the capacity for 3PL businesses to meet customer needs for the least amount of money in the shortest amount of time possible frame and, hence, make them less competitive against their rivals. The performance analysis of 3PL firms in Nairobi County shows that most have wound up operations after being unable to withstand the competitive pressure in the market. Hence, the research sought to investigate how the outcomes of third-party logistics service providers' performance is influenced by logistics management in Nairobi County. It concentrated on the following specific objectives including; effect of transport management, inventory management, and warehousing management on performance of 3PL firms in Nairobi County. Theory of Constraints, Game theory and Theory of Inventory Management and Production aided the research. The study used descriptive research design aiming at 904 logistics companies operating in Nairobi County from this a sample of 90 third party logistics firms was chosen using a simple random sampling. The analysis's basic unit was the operations managers or their equivalent in charge of transport, inventory and warehousing. Data was collected using questionnaires. The research employed descriptive statistics to explain the basic attributes of the data. To determine the relationship between the variables, Pearson's product moment correlation coefficient was applied. Using SPSS version 25.0, a regression model was used to determine the impact of logistics management on third-party logistics service providers. The percentage of a dependent variable's variance that the independent variables in the regression analysis explain was displayed using R-squared 38.8%. The study established an insignificant effect between warehousing management and performance with regression coefficient 0.322 and a p-value 0.064. Further inventory management was found to be positively correlated to performance with a regression coefficient of 0.596 and a p-value of 0.007. Transport management had a regression coefficient of 0.925 and a p-value of 0.000 indicating it is significant. The interaction between firm size and logistics management functions the regression coefficient was -0.308 and a p-value of 0.376. The study concluded that inventory management and transport management had substantial impact on performance on 3PL firms and recommends that 3PL firms to apply inventory management and transport management in order to improve performance. On the other hand, warehousing management was found to be insignificant therefore it does not affect performance. Firm size was found not to alter the nexus between Performances of logistics management function. In order to give the various stakeholders in the third-party logistics industry insight and assistance in approaching logistics management functions in a way that would give them a competitive advantage.