Supply Chain Vulnerability and Customer Satisfaction on petroleum products in Kenya

Abstract

While a supply chain disruption is the trigger that leads to the occurrence of supply chain risks, it is a major determinant of the dissatisfaction from the customers. It therefore seems consequential that the susceptibility of the supply chain to the harm of this disruption is of significant relevance. This leads to the concept of supply chain vulnerability. The basic premise is that supply chain characteristics are antecedents of supply chain vulnerability and impact on both the probability of occurrence as well as on the severity of supply chain disruptions and hence, customer dissatisfaction. The understanding of supply chain vulnerability concept is very important in creating value to the customers. The research involved a cross sectional survey of the registered distributors of petroleum products in Kenya. It adopted a descriptive approach in establishing the impact of Supply chain vulnerability and customer satisfaction on petroleum products in Kenya. The research employed a census of 54 firms out of which, 30 responded. Data was collected from the respondents through a drop and pick method. The data was then analyzed using SPSS and the findings presented in tables. This study revealed that there is a positive relationship between the causes of supply chain vulnerability and customer dissatisfaction. The factors targeted as the causes of supply chain vulnerability like focus on efficiency rather than effectiveness, globalization of supply chains, focused factories and centralized distribution systems, trends to outsourcing, reduction of supplier base, volatility of demand, lack of visibility and control, natural calamities, just in time production system and regulations have a negative effect on customer satisfaction elements studied like price, speed, quality, delivery time and flexibility. The study recommends that the distributors of petroleum products in Kenya should mitigate against the causes of supply chain vulnerability to create value to the customers of the petroleum products.