Procurement Management Practice and Performance of Selected Supermarkets in Nairobi City County, Kenya
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Date
2024-08
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Publisher
Kenyatta University
Abstract
Kenya is the 2nd biggest emerging economy in Sub-Saharan Africa after South Africa. Supermarkets compete fiercely in retail markets in the quest to meet their goals and objectives, such as profit maximization and increasing market share. Supermarkets in Nairobi have placed good strategies for competitive advantage, and invested to satisfy customers. However, supermarkets in Nairobi City County, Kenya have encountered low sales, a decline in profitability, and customer dissatisfaction; this has led to the closure and merger of supermarkets like Uchumi, Tuskys, and Nakurmatta. Studies have been carried out on procurement practices in various sectors of the country but limited studies have been carried out on the trade sector, especially the supermarkets. As a result, the research ascertained how procurement practices, specifically supplier relationship management, inventory management, contract management, and e-procurement adoption, affected Nairobi City County’s supermarket performances in Kenya. The variables selected were supported by stakeholder, resource-based views, and system theories. A descriptive design was deployed during the investigation. The population targeted comprised 94 registered large and medium supermarkets in Nairobi County. The participants included procurement managers and officers at all 94 selected supermarkets in Nairobi City County composed of 282 participants. The survey employed all 282 participants utilizing the census technique as the size of the sample. Utilizing structured questionnaires, primary data was acquired. Validity and reliability tests were conducted on the instrument for data collection using Naivas and Joyland supermarkets in Kiambu County. Data collected was presented utilizing tables and charts as well as analyzed on the SPSS built-in platform in which descriptive and regression analysis was performed. The outputs were offered in charts and tables with the ethics of respect, confidentiality, and fairness upheld. Descriptively all procurement management performs significantly on the selected supermarkets’ performance in Kenya’s Nairobi City County. Outcomes of the investigation displayed that Supplier Relationship Management practices significantly in a positive manner (β = 0.202) affect selected supermarkets’ performance in Nairobi City County, Kenya; inventory management practice positively (β = 0.185) affects the performance of the supermarkets; contract management practice positively (β = 0.135) but affected the performance insignificantly of the supermarkets; while e-procurement adoption significantly affected supermarkets performance in a positive (β = 0.299) manner. The survey recommends that the management of supermarkets should enhance their supplier management to boost the selected supermarkets’ performance. This would allow for the building of a stronger relationship with the suppliers thus cutting down cost as a result of discounting fees. Further investigation is recommended to explore the reasons behind the insignificant effect of contract management practice.
Description
A Research Project Submitted to the School of Business, Economics and Tourism in Partial Fulfillment of the Requirement for the Award of the Degree of Master of Business Administration (Procurement and Supply Chain Option) of Kenyatta University, August 2024.
Supervisor
Perris Chege