Effect of Inventory Management Practices on Performance of Food Processing Firms in Nairobi County, Kenya.

Abstract

the better performance of any firm. The food processing sub sector performance has been declining thus its contribution to the Gross Domestic Product has reduced to 10% thus leading to operation inefficiency. The overall objective of the study was to probe the effect of inventory management practices on performance of food processing firms in Nairobi County. The study was premised on the lean theory. Descriptive design was employed. A population of 172 food processing firms and a sample size of 120 firms was determined. Stratified and simpler random sampling were used to pick specific firms while data was collected using structured questionnaires. Descriptive statistics aided in describing the primary characteristics of the data. Regression analysis aided to ascertain the effect of inventory management 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-statistic was used to establish the overall significance of the model. The study established inventory management was found to be positively correlated to performance, ((regression coefficient 0.492, p value0.000). The study concluded that inventory management practices had substantial impact on performance on Food processing firms and recommends that firms should establish adequate quality control and quality monitoring points in order to get the best quality during the production and also as a way of minimizing on cost. The findings will contribute to theory of supply chain management and policy making regarding different of inventory management practices to ensure increase in performance.