Value chain performance and the profitability of indigenous petroleum marketing firms in Kenya
Abdi, Ali A
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Value chain performance can lead to improvement in the profitability of an organization. The main aim of this study was to establish the impact of value chain performance and the profitability of indigenous petroleum marketing firms in Kenya. The study adopted a descriptive research design in conducting a survey of indigenous petroleum marketing firms in Kenya. Data was collected from 29 firms based in Nairobi through questionnaires. The data was analyzed using Statistical Packages for Social Sciences and was presented in tables. The findings indicate that most of the indigenous petroleum marketing firms in Kenya have applied the value chain concept for a period of less than five years; they have managed to achieve reduction in transport costs, minimization of material costs, reduction in distribution costs, and reduction in inventory handling costs. Due to the adoption of the value chain, most of the indigenous petroleum marketing firms in Kenya have managed to improve delivery time; improve delivery performance; reduce lead time as well as improve information accuracy. The study recommended that it will be significant for the companies to effectively manage the four items above in order to maximize the profitability of their value chains.
University of Nairobi, Kenya