The Effect of strategic purchasing on organization Performance in case of brother flour and biscuit factory ADAMA

Abstract

The aim of the study to examine the effect of Strategic purchasing on organization performance in brother flour and biscuit factory Adama. Target group of the respondent are manager, purchasing officer, finance and administrative and purchasing employee. Interview designed to describe the purchasing practice and questionnaire was designed to collect the data on the independent variable (purchasing skill, collaborative supplier relation and interaction, cost management, supply base management and organization performance. The study was used explanatory and descriptive research design and both primary and secondary data was used to conduct this study. Collected data by using census and analyzed by SPSS 20 Version. Descriptive and explanatory statistics was used to analyze the data and 93 closed ended questioner distributed and 82(88%) were collected. Besides, in descriptive by using frequency, percentage, mean and standard deviation and the study revealed that majority of the respondents feel agreed on strategic purchasing elements of the organization. Inferential statistical methods like correlation analysis was used to assess the relationship between strategic purchasing and organization performance, multiple linear regression analysis also was employed to examine the influence of strategic purchasing on organization performance by using primary data collected through five scale Likert questionnaires. Based on the findings of the study, process of purchasing are long and has some problem on purchasing practice .other finding are all factors of organization performance have a positive and statistically significant correlation with organization performance The multiple linear regression analysis (R2) implies that about 60.8% shows that strategic purchasing elements determine the variation of organization performance of brother flour and biscuit factory ADAMA. Also, the regression result revealed that all explanatory variables have a significant effect on organization performance. This indicated that strategic purchasing elements determine organization performance of brother flour and biscuit factory ADAMA. Therefore, reduce unnecessary redundant process and make it clear process, make it clear format of purchasing, Brother flour and biscuit factory ADAMA should continuous strategic purchasing elements appropriately and continuously as an indispensable tool to improve and maintain sustainable organization performance.