Supply chain management practices and performance in cement industry in Kenya

Abstract

With the number of players increasing in the cement industry, competition has been heightened thus there is need for the firms in the cement industry to devise ways to enable them stay competitive. One of this ways is to reduce on the supply chain costs my effectively managing their supply chains. This study sought to answer the following question: what are the supply chain management practices in the cement industry in Kenya? What impact does SCM practices have on financial performance? This study adopted a survey design. The population was all the 5 cement firms in Kenya. A sample of 25 respondents drawn from the procurement departments of the cement companies was used. Primary data were collected in this study using questionnaires. The survey questionnaire was administered using a combination of methods including drop- and-pick later methods, self-administration, and e-mails. SPSS was used to perform descriptive, correlation and regression analysis. The study found that the most common supply chain management practices in the cement industry were: common set of operating policies, written contracts, clear guidelines and procedures for creating alliances, and supplier screening among other practices. The correlation and regression results showed that supply chain management had a positive and significant influence on performance at 5% level. The study concludes that supply chain management lead to better performance of companies. It is recommended that the management of cement firms in Kenya should keep up establishing ways to manage their supply chains better as this has a direct influence on performance.