INFLUENCE OF SUPPLY CHAIN MANAGEMENT PRACTICES ON PERFORMANCE OF FOOD AND BEVERAGE MANUFACTURING FIRMS IN KENYA
Jane Pauline Muthoni - Master of Science in Procurement and Logistics Management, Jomo Kenyatta University of Agriculture and Technology, Kenya
Dr. Thomas Mose - Jomo Kenyatta University of Agriculture and Technology, Kenya
ABSTRACT
According to the 2018 World Bank economic update, the agricultural and manufacturing sector recorded a significant drop in growth from 4.7% to 1.6% and 2.7% to 0.2% respectively. This is unfortunate as the food and beverage manufacturing sector contribute heavily to the economy having the largest market share in the manufacturing sector as well as providing countless job opportunities to the city residents. This study sort to establish the influence of production management as a supply chain management practice on performance of Food and Beverage manufacturing companies in Kenya. To achieve the study objective, the study utilized descriptive survey research design. This is because this research design helped in collecting quantitative and qualitative data that is required to answer research question. The population of the study was 187 food and beverage manufacturing companies in Kenya where 125 were sampled. A questionnaire was used to collect primary data. Descriptive, correlation and regression analysis were used in the analysis of data. Inferential analysis, correlation coefficient to test for the significance of the association between the variables and regression analysis were carried out to determine the influence of supply chain management practices on performance of food and beverage manufacturing firms in Kenya. Notably, there exists a strong positive relationship between the independent variables and dependent variable as shown by R-value (0.887). The study findings implied that the four independent variables jointly accounted for 78.70% of the performance of F & B manufacturing firms in Kenya. This implies that these variables are very significant therefore need to be considered in any effort to improve the performance of F & B manufacturing firms in Kenya. The study established that production management positively and significantly influenced the performance of food and beverage manufacturing firms in Kenya. The firms were yet to effectively apply demand forecasting, supplier collaboration and production planning to improve performance of food and beverage manufacturing firms in Kenya. It was established that F & B manufacturing firms did little on the forecasting of materials required. There was minimum usage of Materials Requirement Planning (MRP) and to a small extent, they did prequalification of suppliers. Further, it was established that the firms did not have long term contracts with suppliers and did not efficiently schedule work tasks required in the manufacturing process.
