INFLUENCE OF PURCHASING PROCESS ON PERFORMANCE OF MANUFACTURING FIRMS IN KENYA
Harrison Nzyoka Ndeti
Jomo Kenyatta University of Agriculture and Technology
Dr. David Kiarie Mburu (PhD)
Jomo Kenyatta University of Agriculture and Technology
CITATION: Ndeti, H., N. and Mburu, D., K. (2017). Influence of Purchasing Process on Performance of Manufacturing Firms in Kenya. International Journal of Social Science and Entrepreneurship. Vol 6 (3), 57 - 83.
ABSTRACT
The study sought to establish the effect of the purchasing process on the performance of manufacturing firms in Kenya. The dependent variable is performance of manufacturing firms in Kenya, as influenced by the following independent variables; definition of specifications, supplier management, materials ordering and material quality evaluation. The performance of the manufacturing firms was analyzed with the help of following independent variables; - definition of specifications, Supplier management on a manufacturing firm’s performance; material ordering, material quality evaluation. Literature relevant to the variables was reviewed as Theoretical review, Empirical review, and a Conceptual framework in chapter two. The study adopted a descriptive research design, with a population of 553 manufacturing firms across Kenya; a questionnaire with both open ended and closed questions was used to collect raw data from a sample of 232 manufacturing firms in Kenya. The simple random sampling technique was carried out and primary data was collected through the use of questionnaires. A pilot study was conducted to test the reliability and validity of the data collection instrument. The data was analyzed with the help of SPSS version 22. The study adopted regression analysis at 5% level of significance to determine strength and direction of the relationship of the variables under study. It is notable that there extists strong positive relationship between the indepedent variables and depedent variable as shown by R value (0.799). The coefficient of determination (R2) explains the extent to which changes in the dependent variable can be explained by the change in the independent variables or the percentage of variation in the dependent variable and the four independent variables that were studied explain 63.80% of the performance in manufacturing firms as represented by the R2. This therefore means that other factors not studied in this research contribute 36.20% to the performance in manufacturing firms. The study recommends for the proper definition of specification to enhance performance of the firms. Additionally, the manufacturing firms require supplier prequalification. Finally, the material quality evaluation should be enhanced in the manufacturing firms by promoting conformity with market requirements and securing a larger share in export markets and upgrading conformity assessment infrastructure. The study has contributed to knowledge by establishing definition of material specifications, supplier pre-qualification, order processing and material quality evaluation affect performance of manufacturing firms in the Kenyan context.
Key Words: Manufacturing firms, definition of specifications, Supplier management, material ordering and material quality evaluation.
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