Effects of warehouse management practices on organizational performance of logistical firms in Mombasa, Kenya

Abstract

In the recent past, there has been an upsurge in voluminous trade at the East African Ports and more so the Mombasa port of Kenya. The voluminous trade eminent is due to the strategic repositioning of the Mombasa port as a gateway to other East and Central African Countries: Uganda, Rwanda, Burundi, Eastern Democratic Republic of Congo, South Sudan, Ethiopia and North Eastern Tanzania. The ability of Mombasa port of Kenya to handle cargo has been attributed to expansion of the warehousing area for its operations. The objective of the study was evaluation of warehouse management practices on organizational performance of logistical firms in Mombasa. The specific objectives for the study were; to investigate the effect of receiving process of goods on organizational performance, to determine the effect of tracking of goods to and from the warehouse on organizational performance, to investigate the effect of physical storage facilities on organizational performance and to determine the effect of order processing on organizational performance. The theories encompassed in the study included channel coordination theory, theory of constraints and revealed preference theory which relates to logistical management in organizational performance. The study adopted a descriptive research design and collected data using a structured questionnaire from 219 (96.1%) out of a sample 228 respondents. The sample was drawn using stratified random sampling from the management personnel of firms involved in logistics operations in the port Mombasa. The data collected was analyzed using both descriptive and inferential statistics. Descriptive analysis was conducted using frequencies, percentages, mean and standard deviation to summarize the results for the various variables of the study and the results will be presented in tables and figures. Inferential analysis was conducted using Pearson correlation and multiple regression model to test the relationship between the independent variables and the dependent variable at the level of significance of alpha=0.05. Descriptive results indicated that the respondents agreed that receiving process of goods, tracking of goods, physical storage facilities and order processing had improved the organizational performance of logistical firms in Mombasa. Pearson’s correlation results indicated that tracking of goods (r = .715, p < .01), physical storage facilities (r = .741, p < .01) and order processing (r = .829, p < .01) had a significant and high positive correlation with organizational performance. The results also indicate that receiving process of goods (r = .638, p < .01) had a significant and moderate positive correlation with organizational performance. Additionally, multiple regression results indicated that receiving process of orders (β = .519, p < .01), tracking of goods (β = .618, p < .01), physical storage facilities (β = .741, p < .01) and order processing (β = .820, p < .01) had significant and positive influence on organizational performance of logistical firms in Mombasa. The study concluded that receiving process of goods, tracking of goods, physical storage facilities and order processing had statistically significant and positive effect on organizational performance of logistical firms in Mombasa. The study recommends that the management of logistical firms in Mombasa should consider enhancing their warehouse management practices by improving on receiving process of goods, tracking of goods, physical storage facilities and order processing in order to improve on the organizational performance. The study also recommends that the National Government through the Ministry of Industry, Trade and Co-operatives and the Kenya Ports Authority should improve on the existing policy and regulatory framework to ensure effective warehouse management practices among logistical firms in the country in order to improve logistical processes and activities in the country. Finally, the study suggests that further studies should be conducted focusing on other factors influencing organizational performance of logistical firms.