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Navigating challenges: lean inventory management and SMEs performance during the COVID-19 crisis and beyond

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  • Vivien Lefebvre

    (University of Strasbourg)

Abstract

We examine organizational innovation through the adoption of lean inventory management and its impact on firm performance. Specifically, we investigate the moderating roles of firm size and occurrence of an external shock in the relation between lean inventory management and firm performance. Lean inventory management refers to the practice of holding minimum levels of inventory to reduce storage costs and save financial resources and is therefore expected to have a positive on impact firm performance. As small- and medium-sized enterprises (SMEs) face significant resource constraints, lean inventory management is potentially more beneficial for them than for large firms. However, the external disruption caused by an external shock, such as the COVID-19, has more severe consequences for lean SMEs than for larger firms. Using a large sample of French SMEs and large firms, we find evidence to support this view in all major industries. During the COVID-19 crisis, the positive effect of lean inventory management diminished for SMEs. The results have implications for managers regarding inventory management practices.

Suggested Citation

  • Vivien Lefebvre, 2025. "Navigating challenges: lean inventory management and SMEs performance during the COVID-19 crisis and beyond," Small Business Economics, Springer, vol. 64(4), pages 1901-1927, April.
    • Handle: RePEc:kap:sbusec:v:64:y:2025:i:4:d:10.1007_s11187-024-00969-1
    DOI: 10.1007/s11187-024-00969-1
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    More about this item

    Keywords

    Lean inventory management; Financial constraints; SMEs; COVID-19;
    All these keywords.

    JEL classification:

    • G31 - Financial Economics - - Corporate Finance and Governance - - - Capital Budgeting; Fixed Investment and Inventory Studies
    • L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance

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