Order Batching and Performance of Food and Beverage Manufacturing Firms in Kenya

This study examined the relationship between order batching as a component of the bullwhip effect and the performance of food and beverage manufacturing firms in Kenya. The research was motivated by persistent inefficiencies in the sector’s supply chain, including inventory volatility, rising operational costs, and stagnant contribution to GDP despite the Vision 2030 target of 20%. Order batching, manifested through correlated, random, and balanced ordering, has been identified in literature as a key driver of demand variability and operational inefficiencies. The study adopted a descriptive research design with a post-positivist philosophical approach. The target population was 217 food and beverage firms registered by the Kenya Association of Manufacturers, from which 208 respondents were sampled using simple random sampling. Primary data was collected through structured and unstructured questionnaires and analyzed using SPSS version 25. Both correlation and regression analyses were applied. The findings revealed that order batching significantly and positively influences firm performance, explaining 72.3% of the variance. Specifically, batching improved production efficiency, resource utilization, cost savings, and customer responsiveness. The study concludes that effective batching strategies mitigate the bullwhip effect and enhance profitability, sales volume, and market share. It recommends adoption of demand-driven, collaborative, and balanced batching practices to improve competitiveness.