Logistics Management Practices and Supply Chain Performance of Export Firms in Nakuru County, Kenya

Abstract

Export firms play an important role in the economy by influencing employment, economic growth and balance of payments. Exports collectively account for approximately 62% of all the total domestic export earnings. Therefore, promoting exports encourages specialization and learning-by-doing, increasing productivity in the tradable sector and the entire economy. Export firms rely heavily on the efficiency of the supply chain framework of these firms. However, supply chain management practices such as logistics outsourcing remain unknown among these firms. The purpose of this study was to establish the influence of logistics outsourcing practices on supply chain performance in export firms Nakuru County, Kenya. The study was undertaken amongst all 34 export firms registered in Nakuru County, Kenya. The study was anchored on a a Supply Chain Network Theory. The study adopted a descriptive survey research design and targeted 2 supply chain staff in the 34 export firms thus totaling a population of 68 procurement staff. Since the target population was fairly small, the study undertook a census survey. Closed ended questionnaires based on a 5-point Likert scale were used for data collection. The questionnaires were piloted among export firms in Machakos County. Before data collection, the researcher sought a research permit from the National Council for Science, Technology and Innovation (NACOSTI). The data collected was analyzed using both descriptive and inferential statistics with the aid of Statistical Package for Social Science (SPSS) computer software version 23.0. The study found a moderately strong correlation between logistics outsourcing and supply chain performance (r =.523**, p=.000). The study also found an R-square of 0.274 which implied that logistics outsourcing explained 27.4% of variation in supply chain performance of export firms. Therefore, the study concluded that logistics outsourcing was a significant predictor of supply chain performance.