INVENTORY MANAGEMENT PRACTICES AND PERFORMANCE OF FAST-MOVING CONSUMER GOODS COMPANIES IN NAIROBI CITY COUNTY, KENYA
Abstract
Despite this booming performance and attraction of the international players, listed FMCG firms at the Nairobi Securities Exchange are very few. Further, their share price index has always witnessed more daily losses than gains. The main focus of this study was to establish the relationship between inventory management practices and performance of fast moving consumer goods (FMCGs) companies in Nairobi city county, Kenya. Specifically, the study sought to determine the relationship between stock control practices and performance of fast moving consumer goods (FMCGs) companies in Nairobi city county, Kenya and to analyze the relationship between disposal management practices and performance of fast moving consumer goods (FMCGs) companies in Nairobi city county, Kenya. This study used descriptive research design. The study targeted 210 respondents comprising of the heads of department in procurement, manufacturing/Operations, Administration, Sales & Marketing and Finance department in 42 FMCG companies operating within Nairobi City County. Since the target population is small, the study used census method. Primary data was collected using a structured questionnaire with closed-ended questions. Data analysis involved both quantitative and qualitative techniques. Qualitative data from open ended questions was analyzed using content analysis and presented in prose form. Quantitative data on the other hand was analyzed using SPSS where descriptive statistics such as mean, standard deviation, frequencies and percentages were used. Correlation analysis was also done to test the strength and direction of linear relationship between variables. Multiple regression analysis was conducted to determine the relationships between the independent variables and the dependent variable. The findings were presented in tables and figures. The study concludes that stock control practices have a positive and significant effect on performance of fast moving consumer goods (FMCGs) companies in Nairobi city county, Kenya. The study also concludes that disposal management practices have a positive and significant effect on performance of fast moving consumer goods (FMCGs) companies in Nairobi city county, Kenya. Based on the findings, the study recommends that the management of fast moving consumer goods companies in Kenya should Implementing a sophisticated inventory management system that integrates with sales and supply chain operations enables companies to maintain accurate and up-to-date information on stock levels, sales patterns, and order statuses.
Key Words: Inventory Management Practices, Performance of Fast-Moving Consumer Goods, Stock Control Practices, Disposal Management Practices
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