PROCUREMENT MANAGEMENT PRACTICES AND PERFORMANCE OF PETROLEUM FIRMS IN NAIROBI CITY COUNTY, KENYA

Abstract

This study sought to examine the effect of procurement management practices on the performance of petroleum firms in Nairobi City County, Kenya. Specifically, the study sought to find out how procurement planning practice affects performance of petroleum firms in Nairobi City County, Kenya, and to determine the effect of contract management practice on the performance of petroleum firms in Nairobi City County, Kenya. The study used descriptive survey research design. The target population for the study was 73 petroleum firms in Nairobi County. The unit of observation was the four heads of department in the procurement, finance, marketing and logistics departments of every firm. Therefore, the total target population was 292 respondents. The study used primary data which was collected through use of questionnaires. Pilot study was carried out to establish the reliability and validity of research instruments. A structured questionnaire was used to collect data. Data gathered from the questionnaires administered was analysed by the help of SPSS and Microsoft Excel. The outputs were presented inform of statistical diagrams, tables and charts. The study used multiple linear regression and correlation analysis to show the relationship between the variables. The study results were presented through use of tables and figures. The study concludes that procurement planning has a positive and significant effect on performance of petroleum firms in Nairobi City County, Kenya. Further, the study concludes that contract management has a positive and significant effect on performance of petroleum firms in Nairobi City County, Kenya. This study recommends that the management of petroleum firms in Nairobi City County should conduct a thorough analysis of historical sales data and demand patterns to determine the ideal re-order point for inventory items.