NDLI: Effect of Inventory Management on Financial Performance of Listed Manufacturing Firms in Kenya

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Effect of Inventory Management on Financial Performance of Listed Manufacturing Firms in Kenya

Content Provider	Semantic Scholar
Author	Kipkirui, Patrick
Copyright Year	2018
Abstract	This study aimed at investigating the inventory management and financial performance in the manufacturing firms listed in Nairobi Stock Exchange in Kenya. The research objectives were to determine if inventory holding costs affect the performance of the firm, to establish if inventory conversion period has an influence on the performance of manufacturing firms, to determine the effect of actual inventory on the performance of manufacturing firms and to study the effect of optimal inventory orders on the performance of these firms. This study was carried out through a descriptive and quantitative research design. The population of interest in this study constituted all manufacturing companies quoted at the NSE for the period of five years from 2012 to 2016; since the population was small a census was be done. The quantitative research approach was employed to arrive at the findings. The study applied panel data analysis with the aid of the STATA, 13. The study used coefficient of determination to evaluate the model fit of which it was found that the adjusted R was 0.776. This implied that 77.6% of the variations in financial performance are explained by the independent variables under study (Inventory Conversion Period, Inventory Holding cost, Actual Inventory per annum, and Optimal Inventory Orders) at a confidence level of 95%. The R value which was the correlation coefficient was 0.881 which showed that there was a strong correlation between the study variables Inventory Conversion Period, Inventory Holding cost, Actual Inventory per annum, and Optimal Inventory Orders. The study recommended that other studies should be done on the effect of inventory management practices and inventory forecasting techniques and how this can influence the financial performance of manufacturing firms and also other industry sectors.
File Format	PDF HTM / HTML
Alternate Webpage(s)	http://www.strategicjournals.com/index.php/journal/article/download/741/748
Language	English
Access Restriction	Open
Content Type	Text
Resource Type	Article

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