VENDOR-MANAGED INVENTORY ON PROCUREMENT PERFORMANCE OF UPSTREAM OIL AND GAS COMPANIES IN SOUTH-SOUTH, NIGERIA
Keywords:
Vendor-Managed Inventory, Material Availability, Timeliness, Cost Reduction, Procurement PerformanceAbstract
This study investigated the relationship between vendor-managed inventory and procurement
performance of upstream oil and gas companies in South-South, Nigeria. The independent variable
was vendor-managed inventory, while material availability, timeliness, and cost reduction served
as measures of the dependent variable (procurement performance). The study population
comprised twenty-four (24) upstream oil and gas companies in South-South Nigeria as enlisted in
the finelib.com Nigerian Directory and Search Engine. A census method was adopted in selecting
the sample size, administering three copies of a structured questionnaire to Operations Managers,
Procurement/Logistics Managers, and Marketing Managers from each of the 24 companies,
yielding 72 respondents. Data were analyzed using Pearson's Product Moment Correlation and
Linear Regression Analysis with the aid of Statistical Package for Social Sciences (SPSS) version
23.0. The analysis revealed statistically positive and significant relationships between vendor
managed inventory and all measures of procurement performance. Specifically, vendor-managed
inventory showed a moderate positive relationship with material availability (r = 0.440, p < 0.05),
a strong positive relationship with timeliness (r = 0.603, p < 0.05), and a moderate positive
relationship with cost reduction (r = 0.471, p < 0.05). Regression analysis further confirmed that
vendor-managed inventory significantly predicts procurement performance (R² = 0.412, F =
23.456, p < 0.05). The study concluded that vendor-managed inventory significantly relates to
procurement performance of upstream oil and gas companies in South-South, Nigeria. It was
recommended that managers should constantly evaluate current inventory practices to ensure VMI
applicability, integrate environmental protection considerations, and adopt advanced demand
forecasting techniques to improve material availability and timely delivery.
