INVENTORY CONTROL STRATEGIES AND PERFORMANCE OF OIL MARKETING FIRMS IN KENYA

Lawrence Mutuku Kyalo, Dr. Elizabeth Wachiuri

Abstract


Inventory control strategies are typically a key aspect of every organization. Despite the relentless effort research has shown that the promotion of inventory control in the public sector has not been very effective in terms of implementation. Inventory control strategies face numerous implementation challenges. The purpose of the study was to examine the influence of inventory control strategies on performance of oil marketing firms in Kenya. Specifically, the study sought to find out how ABC Analysis influences the performance of oil marketing firms in Kenya and to assess the influence of demand forecasting on the performance of oil marketing firms in Kenya. The research used a cross-sectional survey design. The unit of analysis was the 98 oil marketing firms while the unit of observation was management employees working in the oil marketing firms. In each firm, the study targeted 1 top management employees, 2 middle level management employee and 3 lower level employees. The total target population was therefore 588 management employees. The study used Yamane (1967) formula to determine the size of the sample. From the formula, the sample size was 238 respondents. Primary data was obtained using structured and semi-structured questionnaires. Quantitative data collected was analyzed using descriptive statistical techniques which are frequencies, mean, standard deviation. Inferential statistics which include Pearson correlation and the Regression Analysis Model was used to test the relationship between study variables. The significance of the model was tested at 5% level of significance. Data was analysed using Statistical Package for Social Sciences (SPSS) software version 26. The study concludes that ABC analysis has a positive and significant effect on performance of oil marketing firms in Kenya. The study also concludes that demand forecasting has a positive and significant effect on performance of oil marketing firms in Kenya. Based on the findings, the study recommends that Oil marketing firms should invest in advanced demand forecasting tools and techniques, incorporating both historical sales data and market trends to accurately predict future demand. This will enable firms to optimize their inventory levels, minimize stockouts or overstocking, and better align supply with demand. Effective demand forecasting will lead to improved decision-making, cost savings, and enhanced operational efficiency, ultimately boosting overall firm performance.

 

Key Words: Inventory Control Strategies, Abc Analysis, Demand Forecasting, Performance Of Oil Marketing Firms In Kenya


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