STRATEGIC PROCUREMENT PRACTICES AND PERFORMANCE OF MILK PROCESSING COMPANIES IN KIAMBU COUNTY, KENYA

Daniel Oranga Mukolwe, Dr. Charles Ndeto

Abstract


Over 25% of milk processed in Kiambu is lost or wasted along the value chain due to delayed procurement of packaging materials, machine breakdowns caused by poor supplier servicing, and inconsistencies in raw milk supply. In addition, procurement-related costs account for nearly 60% of total operational expenses among agro-processing firms, highlighting the need for a more strategic and cost-effective approach to sourcing and supplier relationship management. This study therefore sought to assess the influence of strategic procurement practices on performance of milk processing companies in Kiambu County, Kenya. Specifically, the study sought to ascertain how technology utilization affects the performance of milk processing companies in Kiambu County, Kenya and to establish the effect of cost management on performance of milk processing companies in Kiambu County, Kenya. The study used descriptive research design. The population consisted of 11 milk processing firms in Kiambu County. Kiambu County was selected as it hosts some of the largest dairy processing firms in Kenya such as Brookside and Fresha Dairies. The target population was all the 11 milk processing plants in Kiambu County (Kenya Dairy Board report, 2020). The processing plant formed the unit of analysis while the management staff formed the unit of observation. The total target population was therefore 198 respondents. The study adopted Yamane 2018) formula for a finite population. The study used simple random sampling technique to select 132 respondents from the target population. The study used the Statistical Package for Social Studies (SPSS) version 24 as a data analysis tool. The findings and results were presented using tables and figures. The study concludes that technology utilization influences performance of milk processing companies in Kiambu County, Kenya. The study also concludes that cost management influences performance of milk processing companies in Kiambu County, Kenya. From the findings, the study recommends that the management of State Corporations in Nairobi City County should formulate and implement supplier management strategies to ensure proper management of suppliers. In addition, the management should encourage technology adoption in all departments of the organization.

 

Key words: Strategic Procurement Practices, Technology Utilization, Cost Management, Performance of Milk Processing Companies


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