Supplier Development Practices And Operational Performance Of Sugar Manufacturing Firms In Kisumu County, Kenya

Abstract

This study was conducted in Kisumu County, Kenya to determine Supplier development practices and operational performance of Sugar producing firms. The study had three objectives; to determine the effects of Knowledge transfer and supplier training and highlight how it contributes to the operational performance of Sugar Manufacturing firms in Kisumu County, assess the effect of supplier incentive programs on the operational performance of Sugar Manufacturing firms in Kisumu County and finally to determine the effect of supplier relationship and how it impacts on the performance of Sugar Manufacturing firms in Kisumu County. The study was based on the Theory of Constraints; Transaction cost Economies and Resource Dependence Theories. The researcher employed descriptive cross sectional survey research design. Data was collected using a questionnaire that was administered through “drop and pick” method from all the managers and supervisors of the three sugar manufacturing firms. The three sugar manufacturing firms in Kisumu County namely: Muhoroni, Chemelil and Kibos Sugar Companies formed the population. Primary data sources were used to gather information. Data was analyzed using descriptive statistics to determine the extent of the concept using percentages, means and standard deviations. For easy understanding of data Tables and other graphical presentations as appropriate were used to present the data collected. Inferential statistics helped in making relevant generalizations whereby a correlation and regression was used to determine the relationship between variables. The research found it evident that there is a higher positive and significant relationship between operational performance: Knowledge Transfer and supplier Training represented by R=0.705, Supplier incentive programs R= 0.769 and Supplier Relationship Management R=0.839. The researcher found it evident that there is a significant relationship between supplier development practices and operational performance represented by R2 =0.717 which translates to 71.7% of the variations in operational performance explained by the independent variables under study. The operational performance of the firm is measured in terms of improving quality of products, timeline in service delivery, reduction of production cost, improving level of efficiency and operational flexibility. The study only focused on the sugar manufacturing firms in Kisumu County .Therefore, the researcher recommends further research on other manufacturing firms not located in Kisumu County. The researcher also recommends that all manufacturing companies and other organizations to embrace supplier development practices so that they can acquire competencies associated with the concept application and wax stronger in a competitive environment.