Supplier Relationship Management and Performance of Food and Beverage Manufacturing Companies in Kenya

Abstract

Supplier relationship management is the overall coordination, collaboration and information sharing between an organization and its suppliers. The general objective of this study was to analyze the influence of supplier relationship management on organizational performance using food and beverage manufacturing companies in Kenya. The study was guided by the following specific objectives: to assess the influence of supplier segmentation, to examine the influence of supplier selection, to determine the influence of supplier development and to evaluate the influence of supplier collaboration on organizational performance and to determine the moderating influence of organization culture on the relationship between supplier relationship management and performance of food and beverage manufacturing companies in Kenya. The study employed a mixed methods research design.. The study used; Grey Theory, Fuzzy Sets Theory, Resource Dependence Theory, Social Network Theory and Contingency Theory. The target population was 687 respondents from 226 food and beverage manufacturing companies in Kenya. A sample size of 252 was selected from food and beverage manufacturing companies. Stratified simple random and purposive sampling were used to select respondents. Primary data was collected by the use of a questionnaire with close ended questions. Secondary data was collected through empirical review of studies done in this field. The reliability coefficient of the questionnaire was assessed by using Cronbach’s Alpha. Content validity of the instrument was determined by the researcher using expert judgment. Factor analysis, conducted using Principal Components Approach method was used to establish the appropriateness of the questionnaire constructs. Analysis of data was done using descriptive, correlation and regression analyses. Findings were presented using tables to give a clear picture of the research findings at a glance. From the regression model, Supplier selection, supplier segmentation, supplier development and supplier collaboration had a significant positive relationship with performance of food and beverage manufacturing companies in Kenya. The study concluded that SRM positively influences the performance of food and beverage manufacturing companies in Kenya. The study recommends that the managements of food and beverage manufacturing companies in Kenya should ensure that SRM at all levels of the organization and its stakeholders is enhanced so that it can contribute to competitive advantage of the firm. Firms should optimize and improve organization culture in order to maximize on their performance.