Supply Chain Management Practices on Organizational Performance: A Case Study of Tea Industries in North Rift Valley, Kenya

Abstract

The tea sector in Kenya has been in a crisis for the past decade due to supply and demand implications. Tea prices are increasing in the short term, but long-term prices have decreased to half of what farmers received five decades ago. The main purpose of the study was to evaluate the effect of supply chain management practices on organizational performance of tea industry in the North Rift Valley, Kenya. The study was guided by the four objectives: to identify supply chain management practices adopted by firms in the tea industry in North Rift Valley Kenya, to establish the level performance of tea firms in North Rift Valley Kenya, to find out if there is a significant relationship between SCM practices and performance in the tea industry in North Rift Valley, Kenya and to give recommendations on how to improve the levels of supply chain management practices of tea industry in the North Rift Valley, Kenya. This study utilized a descriptive mixed research design. Tea manufacturers in the North Rift Valley region were investigated using a census technique. Purposive sampling and stratified sampling were used, with departments divided into clusters for each level of the organization. To pick respondents in various strata, simple random sampling was used. Total of 71 respondents participated in the study. For data analysis, this study used SPSS version 25.0, which generated descriptive statistics, frequency tables, plots, and graphs. It also supplied inferential statistics and variable correlations. Multiple linear regression was used to test the hypotheses. The study findings showed that tea companies in the region recognize the importance of collaborative partnerships, lean practices, and effective materials management in optimizing their supply chain performance. From the findings, it was concluded that Tea firms in North Rift Valley, Kenya recognize and value strategic partnerships, lean practices, and materials management as key components of effective supply chain management. The study found that the tea companies are performing well in terms of efficiency and profitability. However, there was no significant relationship between strategic partnership and performance, hence the study recommended that tea firms should focus on improving their lean practices and materials management to optimize their supply chain performance.