Supplier’s Past Performance Criteria and its Effect on Procurement Performance in County Governments in Kenya

Abstract

The major focus of the study is to investigate the supplier selection criteria and its effect on procurement performance in county governments. The specific objective was to examine the effect of supplier’s past performance on procurement performance in county governments. Descriptive research design was applied in the study. The study population was 168 that included professional employees working in the county government departments of Murang’a and Kirinyaga counties. Purposive sampling was preferred in selection of the sample size of 60 respondents who were the heads of the departments. Data collection tool was self-administered questionnaires. Both descriptive and inferential statistics were used to perform data analysis. The results of the model summary indicated that R2 equals 0.642, thus revealing that 64.2% of the procurement performance in county governments can be attributed to supplier’s past performance. The study concludes that there is a positive strong effect between supplier’s past performance and procurement performance. The study recommends an effective scrutiny on supplier’s past performance before awarding contracts by carrying out due diligence to minimize uncertainties arising from supplier failure to execute complex contracts that require a given level of expertise

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East African Journal of Business and Economics, Volume 6, Issue 1, 2023
Article DOI: https://doi.org/10.37284/eajbe.6.1.1287
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East African Journal of Business and
Economics
eajbe.eanso.org
Volume 6, Issue 1, 2023
Print ISSN: 2707-4250 | Online ISSN: 2707-4269
Title DOI: https://doi.org/10.37284/2707-4269
EAST AFRICAN
NATURE &
SCIENCE
ORGANIZATION
Original Article
Supplier’s Past Performance Criteria and its Effect on Procurement
Performance in County Governments in Kenya
Mogere Alicent Ondieki1*, Oteki Evans Biraori1 & Muhoro Priscilla1
1 Muranga University of Technology, P. O. Box 75-10200. Muranga, Kenya
* Correspondence ORCID ID: https://orcid.org/0009-0003-4444-5079; email: alicentondieki@gmail.com
Article DOI: https://doi.org/10.37284/eajbe.6.1.1287
Date Published:
04 July 2023
Keywords:
Supplier Selection,
Supplier’s Past Performance,
Procurement Performance,
Supplier Reliability
ABSTRACT
The major focus of the study is to investigate the supplier selection
criteria and its effect on procurement performance in county
governments. The specific objective was to examine the effect of
supplier’s past performance on procurement performance in county
governments. Descriptive research design was applied in the study.
The study population was 168 that included professional employees
working in the county government departments of Murang’a and
Kirinyaga counties. Purposive sampling was preferred in selection of
the sample size of 60 respondents who were the heads of the
departments. Data collection tool was self-administered
questionnaires. Both descriptive and inferential statistics were used to
perform data analysis. The results of the model summary indicated
that R2 equals 0.642, thus revealing that 64.2% of the procurement
performance in county governments can be attributed to supplier’s
past performance. The study concludes that there is a positive strong
effect between supplier’s past performance and procurement
performance. The study recommends an effective scrutiny on
supplier’s past performance before awarding contracts by carrying out
due diligence to minimize uncertainties arising from supplier failure
to execute complex contracts that require a given level of expertise.
APA CITATION
Ondieki, M. A., Biraori, O. E. & Priscilla, M. (2023). Supplier’s Past Performance Criteria and its Effect on Procurement
Performance in County Governments in Kenya. East African Journal of Business and Economics, 6(1), 162-174.
https://doi.org/10.37284/eajbe.6.1.1287
CHICAGO CITATION
Ondieki, Mogere Alicent, Oteki Evans Biraori and Muhoro Priscilla. 2023. “Supplier’s Past Performance Criteria and its Effect
on Procurement Performance in County Governments in Kenya”. East African Journal of Business and Economics 6 (1), 162-
174. https://doi.org/10.37284/eajbe.6.1.1287.

East African Journal of Business and Economics, Volume 6, Issue 1, 2023
Article DOI: https://doi.org/10.37284/eajbe.6.1.1287
163 | This work is licensed under a Creative Commons Attribution 4.0 International License.
HARVARD CITATION
Ondieki, M. A., Biraori, O. E. & Priscilla, M. (2023) “Supplier’s Past Performance Criteria and its Effect on Procurement
Performance in County Governments in Kenya”, East African Journal of Business and Economics, 6(1), pp. 162-174. doi:
10.37284/eajbe.6.1.1287.
IEEE CITATION
M. A. Ondieki, O. E. Biraori & M. Priscilla “Supplier’s Past Performance Criteria and its Effect on Procurement Performance
in County Governments in Kenya”, EAJBE, vol. 6, no. 1, pp. 162-174, Jul. 2023.
MLA CITATION
Ondieki, Mogere Alicent, Oteki Evans Biraori & Muhoro Priscilla. “Supplier’s Past Performance Criteria and its Effect on
Procurement Performance in County Governments in Kenya”. East African Journal of Business and Economics, Vol. 6, no. 1,
Jul. 2023, pp. 162-174, doi:10.37284/eajbe.6.1.1287.
INTRODUCTION
Since it directly affects the competitiveness of any
industry, supplier selection as a function of the
procurement department has grown to be one of the
most crucial responsibilities of procurement
managers. As a consequence, choosing the right
suppliers helps firms significantly while also raising
customer satisfaction (Masemola et al., 202).
Failure to use the right procedure when choosing the
best possible supplier might lead to supplier risks,
which could halt business operations. The
competency of potential vendors is assessed using a
variety of methods during the selection process.
Firms can save money by evaluating potential
suppliers against pre-determined criteria while also
enhancing customer service quality. Therefore,
selecting suppliers on the basis of the past records
of similar contracts executed is fundamental in
building the confidence of the user departments in
terms of successful execution of contracts.
The demand on procurement departments to select
the most economically advantageous offer in order
to ensure cost-effective and efficient procurement is
increasing. To choose a bidder, a thorough analysis
of potential candidates should be conducted whose
historical performance could have an impact on the
effectiveness of any procurement function or
process (Mutai, 2016). During the tender stage, a
supplier's capabilities in terms of capacity, financial
stability, quality standards, performance, and
organizational and process structures may be
evaluated by a questionnaire, interview, or site visit.
In order to be included to the list of approved
suppliers, existing and potential suppliers are
evaluated for suitability and either accepted or
rejected (CIPS, 2018).
When selecting the best offer to purchase the
commodities, services, and labour needed for an
organization to achieve its objectives, a supplier is
assessed based on past performance (Oteki, 2021).
The evaluation criteria also take into consideration
other factors such as personnel (key managers,
technical staff), competency and capacity (tools and
equipment, process quality systems, certification),
Experience (clients served for last three years of
similar tender), financial capability (audited
financial statements). The lowest responding
evaluated proposal is what is referred to as the best
offer after bid evaluation (Oteki, 2021). The most
advantageous bid is another name for it.
Nevertheless, inefficiencies in supplier evaluation
continue, ranging from partial contract delivery to
early contract termination, notwithstanding the
passage of the Public Procurement and Asset
Disposals Act (PPAD) of 2015 and the Public
Procurement and Asset Disposal Reform Act
(PPADR) of 2020.
It is vital to assess the procurement performance and
how it can be accrued from proper assessment of
supplier’s past performance. This is because of its
contribution to the advantages that results from an
effective selection process such as increase in
efficiency and productivity and boosted customer
confidence on supplier’s ability and reliability to
execute contracts of similar nature. The choice and
retention of competent employees is crucial in

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procurement. To choose the best bidder, a
corporation must take into account additional
aspects.
Statement of the Problem
Most entities in Kenya are affected negatively by
delayed deliveries of goods, works and services due
to the inability of suppliers to deliver contracts as
agreed. This is attributed to poor selection of
suitable suppliers from a common pool of suppliers.
This results on constant project delays considering
that most non-performing contracts are terminated
and hence have to be started again (Kibet & Njeru,
2014). It also causes further delays in completion of
projects and timely delivery of goods and services.
Delayed project delivery is mostly attributed to
challenges of the procurement department to select
suppliers with impressive past performance records
(Beil, 2010). According to a report by Ethics and
Anti-corruption Commission 2015, an evaluation of
corruption and procurement performance in public
procurement asserts that termination of contracts is
a common challenge in public sector procurement
(Kakwezi & Nyeko, 2019).
Further, the report attributes 25% of contract
terminations to supplier failure, 15% results from
non-adherence to timeline by suppliers, 14% results
from changes in prices of goods, while 9% is
attributed to poor quality of goods and services.
Procurement is perceived to experience challenges
in terms of waste and low quality of service
(Mukarumongi, 2018). The 2018 Auditor General's
Report claims that county governments in Kenya
lost Ksh. 2 billion in the 2016–2017 fiscal year as a
result of paying bidders for work that was subpar,
incomplete, and didn't meet requirements, as well as
those who provided poor quality goods and services
(Masemola et al., 2022). It is evident that most
procurement challenges are attributed to
termination of procurement contracts, incomplete
orders, delivery of substandard works, products, and
services, supplier failure, and non-adherence to
delivery timelines.
General Objective
To assess the effect of supplier’s past performance
on procurement performance in the county
governments.
Specific objective
• To examine the effect of supplier reliability on
procurement performance in the county
governments.
• To investigate the effect of quality expectation
on procurement performance in the county
governments.
Hypothesis
HO1: There is no statistically significant effect of
supplier reliability on procurement performance in
the county governments.
HO2: There is no statistically significant effect of
quality expectation on procurement performance in
the county governments.
LITERATURE REVIEW
The section provides analysis of supplier’s past
performance and procurement performance in the
county governments. It outlines the theoretical
framework, empirical review, and conceptual
framework.
Game Theory
In the 1940s, mathematician John Von Neumann
and economist Oskar Morgenstern laid the
groundwork for the development of game theory.
The study of strategic interactions between players
is known as game theory. Several academics and
industry experts contributed to the theory. They
studied and developed the notion extensively in the
1950s about the theory. Many sectors, including
economics, politics, computer technology,
psychology, and even biology, employ game theory
extensively (Fargetta & Scrimali, 2019). The theory
states that, while developing the strategy or action
in a game, it is your responsibility as a player to

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consider the decisions made by other players. In
procurement procedures, the parties participating
are referred to as "Players," and the negotiation
process is "The Game." The phrase "Knowledge
Set" relates to each side's previous data, whereas
"Strategy" refers to the specific course of action that
a player would take in any particular situation.
When both parties reach an agreement at the end of
a game, the words Pay Off and Equilibrium are
employed. The prevalence of zero-sum games, in
which only one participant benefits from the
outcome, stimulated game theory's development.
Businesses use game theory to deal with complex
events, including mergers, product launches,
negotiations, and pricing wars (Mwikali & Kavale,
2012). In procurement, buyers and sellers frequently
negotiate, and these interactions may be challenging
for both parties. Using Game Theory during
procurement discussions can help in getting better
results and make better judgments (Fargetta &
Scrimali, 2019). Although the procurement sector is
fully aware of the advantages of employing Game
Theory during negotiations, it has only just begun to
do so. Participants in a game are seen as rational
decision-makers who are willing to apply their
knowledge and collaborate to achieve equilibrium
(Reza-Gharehbagh et al., 2019). By providing their
compromise possibilities, the parties concerned
may be able to build confidence and establish a
mutually beneficial solution using game theory.
The study is anchored in game theory considering
that some of the concepts provide a language to
formulate, structure, and analyse with the objective
of selecting the best supplier from numerous
suppliers with respect to understanding strategic
scenarios (Kamotho, 2014). The theory also helps
buyers to maintain their current suppliers without
paying hefty additional costs. Makabira and
Waiganjo (2014) claim that the study's main
objective is consistent with the supplier selection
theory's overall objective, which is to improve the
outcomes of all decision-making procurement
circumstances, including complex and cross-
functional sourcing. In order to comprehend county
government actions throughout the development of
supplier selection criteria and their cumulative
impact on procurement performance, the study
additionally utilised theoretical frameworks.
The contacts between buyers and sellers, which are
frequent in procurement, can be challenging for
both parties. This makes the problem crucial to
game theory. Game Theory use in procurement
conversations can result in efficient decisions and
strategic assessments of possible suppliers.
Although game theory's benefits in negotiations are
well known in the procurement industry, its
application is still in its infancy.
Empirical Literature Review
The study focused on analysis of empirical papers
related to supplier selection and procurement
performance. Supplier selection in today's fast-
paced business environment is not just based on
technical and operational considerations; instead, it
is a strategic decision requiring a cross-functional
approach, including procurement, accounting,
operations, and information technology (IT). The
final decision on the listed supplier must consider
more than just price. Competitive supplier selection
activities can help to increase procurement
efficiency and effectiveness (Waweru, 2015).
Therefore, this is an option worth considering.
There are several advantages to choosing one's
suppliers. Clients may get a range of benefits from
suppliers, including improved process performance
and ongoing reductions in costs. According to CIPS,
supplier selection is one of the most important
aspects of strategic sourcing, supplier management,
and competitive advantage building (Aseka, 2010).
Supplier’s Past Performance and Procurement
Performance
Organizations consider various factors when
making purchase decisions. The promptness of
product and service delivery is one factor to take
into account while evaluating and choosing offers.

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It is essential to build a reliable relationship with the
clientele of the company. The prompt and reliable
delivery of a product is a delivery criterion. Johnson
and Flynn (2015) assert that the method of
administration can change efficacy. Successful bids
will have the flexibility to quickly adapt to shifting
production and order requirements while still
satisfying the buyer's expectations. Shipping
expenses are decreased and product delivery times
are shortened. With the rise of JIT production
planning, manufacturers must operate with less
inventory. As a result, timely and accurate delivery
is now more crucial than ever in the majority of
procurement businesses.
Businesses may monitor the efforts made by their
current suppliers to suit their needs through supplier
performance monitoring. An essential part of supply
chain management is assessing suppliers'
performance in fulfilling expectations from
procurement organizations (Maestrini et al., 2018).
Supplier monitoring has been connected to
performance in a variety of areas of the literature
(Subramaniam et al., 2020; Yang & Zhang, 2017),
While some studies found no connection between
supplier monitoring and performance others found
a strong one (Maestrini et al., 2018). Therefore, it is
essential to evaluate the effectiveness of one's
providers. Efficiency in procurement has been
examined as a means of cost reduction. Kakwezi
and Nyeko (2019) define "procurement operational
efficiency" as the capacity to provide goods and
services at the most reasonable cost.
A corporation's necessary safety stock may be
reduced, according Baily et al. (2015), if it can
depend on its vendors to deliver on time. The
appropriate time period should be stated together
with the considerations to be taken into account for
evaluating this criteria. Early deliveries into a
vacant warehouse incur no additional cost, whereas
delivery delays or early deliveries into a full
warehouse may incur greater expenses (Barla,
2018). Quantitative data is necessary to offer a
reliable evaluation based on this criterion, and this
data must be continually preserved for each bidder.
This criterion is quantitative since its evaluation is
based on data (Monczka et al., 2016).
The precision with which quantities are given must
be quantified in order to evaluate delivery
reliability. This criterion and the previously
mentioned "Delivery reliability based on time"
criterion are fairly comparable. The amount
reliability and real accuracy of the bidder should be
considered while applying this criterion. Barla
(2018) suggests retaining adequate order amounts
as criteria, which is defined as putting the proper
number of orders. This statistic assesses the
efficiency and accuracy with which a provider can
execute an order and serves as a quality indicator for
the logistics industry. Through a workshop and
interviews, this criterion was created and selected.
Delivery reliability, order lead time, and total order
fulfilment, as previously mentioned, were the initial
three criteria that were employed. These three
requirements were reduced to two during the
model's development, taking quantity and
timeliness into account. This being a numerical
criterion, the choice must be based on specific
figures.
Procurement Performance
Since bids may affect the price, quality,
dependability, and availability of a company's
goods and services, bid review is generally regarded
as the most crucial step in the procurement process
(Monczka et al., 2016). Organizations believe that
rigorous bid evaluation will help cut product and
material prices while assuring a high level of quality
and after-sales services, according to Kakwezi and
Nyeko (2019). This emphasizes the necessity of
creating a suitable review process to guarantee the
acquisition's success. Selecting acceptable bidders
is a crucial strategy for raising the caliber of the
company's production since unsuitable bidders have
a negative impact on the organization's performance
and can indirectly affect its reputation.

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Since the supply chain's procurement function is so
crucial, its performance needs to be evaluated and
tracked. One can assess progress toward goal
attainment by setting quantitative criteria that
performance can be measured against on a regular
basis (CIPS, 2018). This makes it possible to gauge
how close a company is to achieving its objectives.
Johnson and Flynn (2015) contend that in order to
improve the procurement process, it must first be
precisely mapped. By setting goals and conducting
performance evaluations, the procurement process
may be controlled effectively. One method to
achieve this aim is by using KPIs. KPIs are
necessary because they provide a definition of
performance objectives in a way that enables direct,
exhaustive, and consistent operational monitoring
using data collection techniques that are now
accessible. According to Lyson and Farrington
(2016), key performance indicators (KPIs) are
monitored, evaluated, and reported on on a regular
basis to ensure that the organization's project is on
track in terms of its most crucial success criteria. A
good procurement process includes cost savings,
improved product quality, on-time service delivery,
and the deployment of suitable resources of a certain
grade (CIPS, 2018).
Despite having a procurement system in place,
Makori and Muturi (2018) found that companies
still experience delivery problems as a result of
inadequate vendor selection criteria. Despite the
presence of a system to regulate economic activity,
this was shown to be true. Numerous studies on the
factors that influence supplier selection have created
a wealth of knowledge about the numerous
problems that arise from poor supplier selection,
leading to ineffective project execution and publicly
apparent outcomes. According to the results of
several empirical studies investigating supplier
selection factors, poor performance, for instance, is
related to difficulties encountered throughout the
supplier selection process (Wachiuri, 2018). After
conducting several empirical analyses of supplier
selection criteria, this conclusion was established.
According to Odhiambo (2015), ineffective and
inefficient rules and procedures—which are the end
result of supplier selection criteria processes—are
the cause of poor or inadequate service or product
delivery. The audience's expectations are violated
by this.
Procurement performance can be termed as the
efficiency and efficacy of the procurement function
in procuring goods and services. A corporation must
move from a reactive to a proactive attitude to fulfil
its performance goals. Some of the accrued benefits
include improved procurement performance which
can lead to cost savings, greater policy compliance,
faster lead times, and increased adherence to
procurement standards (Waweru, 2015).
Procurement practices and financial success have a
relationship, shown in decreased spending.
Turnover, gross profit, efficiency, total expenses,
and equity are all factors. There is a significant
relationship or connection between how supplier
ratings are regulated and used to benefit the business
in these categories.
A metric that assesses how successfully the
procurement department is accomplishing goals
while spending the least amount of money is
procurement performance (Naibor & Moronge,
2018). Effectiveness and efficiency are the two most
important aspects of procurement success. A
successful procurement plan depends on the extent
to which the basic aims and objectives are realized.
This phrase refers to any human action's actual and
intentional outcomes. Procurement efficiency is
described as the link between the anticipated and
real resources needed to meet established goals and
objectives and the duties that go along with them.
The discrepancy between expected and actual
spending is being looked into. As a result, the most
critical aspect impacting procurement performance
is the quality of the vendors with whom you do
business.
Conceptual Framework
In addition to the literature review, the following
conceptual model was developed. The framework is

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made up of two constructs. Suppliers’ past
performance as the independent variable and procurement performance as the dependent
variable.
Figure 1: Conceptual Framework
Independent variable Dependent variable
Supplier’s Past Performance
A company or individual that has performed well on
previous contracts and has shown proven results in
using Supply Chain Management business practices
is likely to do the same on similar contracts in the
future. Including past performance as an evaluation
factor helps to ensure quality suppliers can be relied
upon in executing contracts that require short
deadlines. All past performance evaluations should
consider the following factors: Quality, timeliness
of performance, business relations, and cost control.
When evaluating past performance, emphasis
should be placed on similar contracts executed
previously.
Overall performance for private and public sector
customers should also be reviewed. The selection
process takes into consideration supplier reliability
and quality expectations. This can be assessed
through determining supplier’s ability to execute
contracts of similar magnitude from past records,
ability to meet short deadlines and urgent orders,
their capacity to meet the specified prescriptions
and expectations, assuring the delivery of quality
goods and services, and finally ability to meet the
departmental quantity requirements. The review of
past performance should generally be limited to
contracts completed within the last three years.
However, longer periods may be reviewed when the
purchase/SCM team deems them appropriate.
The study conceptualized that supplier's past
performance, it is important to consider both
quantitative and qualitative data. Quantitative data
may include metrics such as on-time delivery rate,
defect rate, and customer satisfaction ratings.
Qualitative data may include feedback from
customers on the supplier's responsiveness,
communication, and ability to resolve issues
(Wachiuri, 2018). By analyzing both types of data,
it is possible to develop a comprehensive
understanding of a supplier's past performance,
which can help inform decisions on whether to
continue doing business with them or to seek out
other suppliers who may be better able to meet the
needs of the organization. Additionally, this
information can be used to identify areas where the
supplier may need to improve their performance and
to establish performance benchmarks for future
performance evaluations.
Procurement Performance
The performance of a Procurement function can be
conceptualized in several ways, but some common
Quality expectation
• Meet departmental descriptions
• Delivery of specified standards
Supplier reliability
• Contracts of similar magnitude
• Meeting short deadlines
Procurement Performance
• Supplier failure
• Saving on costs

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measures include cost saving, which provides a
measure on the Procurement department's ability to
negotiate favourable prices and terms with
suppliers. It is often expressed as a percentage of the
total spend incurred by the department. The other
key consideration is supplier performance that
entails the quality and timeliness of deliveries from
suppliers. It can include metrics such as on-time
delivery, defect rates, and lead times. Another
component to determine procurement performance
is compliance that addresses the department's
adherence to internal policies and external
regulations. It can include metrics such as contract
compliance, supplier diversity, and sustainability.
For purposes of assessing procurement performance
in the departments, the key determinants include
achieving reduction in product and material costs,
reduction in supplier quality, efficiency in supply
chain management, delivery of goods and services
within a short time, reduced supplier defect rates,
reduction in supplier lead time, and less complaints
from the user department. Overall, the performance
of a Procurement function can be evaluated using a
combination of these metrics, depending on the
organization's goals and priorities. Therefore, a
high-performing Procurement department can help
an organization achieve cost savings, mitigate risks,
and drive innovation through effective supplier
relationships.
METHODOLOGY
A descriptive research design was used in this study
since it helped to demonstrate the effect that exist
between supplier selection criteria and procurement
performance in the county governments. The study
targeted a population of 168 professionals working
in the county departments and who actively
participate in the day-to-day operations. The study
adopted purposive sampling to identify 60 heads of
departments to provide expert knowledge and
experience on the required study area. The selection
of Murang’a and Kirinyaga sites was appropriate for
this study to provide a clear picture of the current of
procurement performance in Kenyan counties.
Murang’a county and Kirinyaga county
governments are also characterized by increased
economic growth through resource mobilization
and policy harmonization. Data collection was done
using self-administered questionnaires on a drop
and pick basis. Descriptive and inferential statistics
was used in analysis of the results. Regression
analysis assisted to assess the effect of supplier’s
past performance on procurement performance in
county governments. The regression analysis model
formula was as follows; 𝑌 = 𝛽0+ 𝛽1𝑋1+ 𝛽2𝑋2+
𝜀 whereby: 𝑌 = Procurement performance, 𝛽0=
Constant of the model, 𝑋1=supplier
reliability, 𝑋2=quality expectation, 𝛽1=
Coefficients for the determination and 𝜀 = Error
term.
FINDINGS AND DISCUSSIONS
Effect of Supplier’s Past Performance on
Procurement Performance
The objective of the study was to examine the effect
of supplier’s past performance on procurement
performance in the county governments. To
accomplish this, a five-point Likert scale
comprising of five items was used. The scale rating
ranged from 1 to 5 with 1 denoting strongly
disagree, 2 representing disagree, 3 representing
neutral, 4 agree and 5 strongly agree. The midpoint
of the scale was a score of 3. Table 1 shows the
frequencies and percentages obtained from the
items on supplier’s past performance. As shown, the
mean scores obtained by the respondents on the
scale measuring supplier’s past performance ranged
from 3.55 to 4.47.
The highest ranked items on the scale were
“Supplier’s ability to execute contracts of similar
magnitude (4.47)” and “Capacity to meet the
specified prescription and departmental features
(4.03)”. On the other hand, the lowest ranked items
were “Meeting the specified prescription and
departmental features (3.55)” and “Delivering
particular quality of goods and services (3.64). The
findings presented in Table 1 show that most of the

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respondents obtained mean scores above 3, meaning
majority of them were in agreement with the
statements on the scale. This clearly indicates that
supplier’s past performance is an important
consideration in procurement performance as
supported by the study by Aseka (2010) that
indicates supplier’s past performance influences
performance of manufacturing companies in NSE.
Table 1: Supplier's Past Performance
Supplier’s past performance
N
Mean
Std. D
Supplier reliability
Supplier’s ability to execute contracts of similar magnitude
58
4.47
0.995
Ability of meeting short deadlines and urgent orders
58
3.81
0.963
Capacity to meet the specified prescription and departmental features
58
4.03
0.772
Quality expectation
Delivering particular quality of goods and services
58
3.64
0.583
Meeting the specified prescription and departmental features
58
3.55
0.567
Procurement Performance
The study also sought to determine the respondents’
views on their departments’ views in their
organization and the respondents were asked to
indicate their level of agreements on a Likert scale
of 1 to 5 where 1= strongly disagree 2=Disagree
3=Neutral 4= Agree 5= strongly agree. Table 2
indicates frequencies and percentages for the
responses given. the mean scores obtained by the
respondents on the scale measuring procurement
performance ranged from 3.71 to 4.33. The highest
ranked items on the scale were “Reduced supplier
defect rates (4.33)” and “Delivery of goods and
services within a short time (4.24)”. On the other
hand, the lowest ranked items were “Reduction in
production and material costs (3.71)” and
“Reduction in supplier lead time (3.91)”. The
findings presented in Table 2 shows that most of
respondents obtained mean scores above 3, meaning
majority of them were in agreement with the
statements on the scale.
Table 2: Procurement performance
Procurement Performance
N
Mean
Std. D
Reduction in product and material costs
58
4.03
0.794
Reduction in product and material costs
58
3.71
0.899
Efficiency in supply chain management
58
3.98
0.827
Delivery of goods and services within a short time
58
4.24
0.709
Reduced supplier defect rates
58
4.33
0.711
Reduction in supplier lead time
58
3.91
1.031
Less complaints from the user department
58
4.05
0.981
Model Summary for Supplier’s Past Performance
on Procurement Performance
Table 3 indicates the results obtained through
testing the model from the coefficient of
determination. The results showed that R Square =
0.642 at 0.05 significance level. Therefore, the
coefficient of determination (R square) postulates
that 64.2% of the procurement performance in the
public sector can be attributed to the consideration
of supplier’s past performance in supplier selection.
This indicates that there exists a strong positive
effect of supplier’s past performance on
procurement performance. The findings are as
shown in the Table 3.

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Article DOI: https://doi.org/10.37284/eajbe.6.1.1287
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Table 3: Model Summary Supplier's Past Performance on Procurement Performance
Model
R
R Square
Adjusted R Square
Std. Error
1
.801a
.642
.629
.161
Predictors: (Constant), Supplier reliability, Quality expectations
Dependent variable: Procurement performance
ANOVA Supplier’s Past Performance on
Procurement Performance
The probability value of 0.000 indicates that the
regression relationship is highly significant in
predicting how supplier’s past performance affects
procurement performance in the county
governments. The F calculated at 5% level of
significance was 49.283 and since F calculated is
greater than the F critical (value = 4.01), this shows
that the overall model is significant. Findings are
shown in Table 4.
Table 4: ANOVA Supplier's Past Performance on Procurement Performance
Model
Sum of Squares
Df
Mean Square
F
Sig.
1
Regression
2.57
2
1.285
49.283
.000b
Residual
1.434
55
.026
Total
4.004
57
a. Dependent Variable: Procurement performance
b. Predictors: (Constant), Supplier reliability, Quality expectations
Table 4 indicated that the p-value were (p = 0.012
and 0.000) for supplier reliability and quality
expectations respectively. This shows that the
constant and independent variables (Supplier
reliability and quality expectations) contribute
significantly to the model. The regression model is
presented as follows; Procurement Performance =
2.435 +0.323 (Supplier reliability) +0.410 (Quality
expectations). The regression model has established
that procurement performance will equal to 2.435
when the supplier reliability and quality
expectations equal to zero. Procurement
performance is predicted to improve by 0.733 when
both supplier reliability and quality expectations
goes up by one unit.
At 5% level of significance and 95% level of
confidence, supplier reliability had p-value of 0.012
while quality expectations had a p-value of 0.000
indicating that both supplier reliability and quality
expectations are statistically significant (p< 0.05).
The Table 5 provides the information of supplier
reliability and quality expectations. This equation is
a multiple regression model that relates the
procurement performance of a company to the past
performance of its suppliers. The equation states
that the expected procurement performance (the
dependent variable) is equal to a constant term of
2.435 plus 0.323 times supplier reliability plus
0.410 times quality expectations, where supplier
reliability and quality expectations are the
independent variables.
Table 5: Coefficients
Model
Unstandardized
Coefficients
Standardized
Coefficients
t
Sig.
B
Std. Error
Beta
1
(Constant)
2.435
.165
14.722
.000
Supplier reliability
.323
.044
.561
3.511
.012
Quality expectations
.410
.065
.755
6.322
.000
The Hypothesis postulated that,

East African Journal of Business and Economics, Volume 6, Issue 1, 2023
Article DOI: https://doi.org/10.37284/eajbe.6.1.1287
172 | This work is licensed under a Creative Commons Attribution 4.0 International License.
HO1: There is no statistically significant effect of
supplier reliability on procurement performance in
the county governments. The results of multiple
regressions, revealed that supplier reliability has a p
= 0.012. Since the p- value is less than < 0.05, the
null hypothesis was rejected. It was then concluded
that there is significant effect of supplier reliability
on procurement performance in the county
governments.
HO2: There is no statistically significant effect of
quality expectation on procurement performance in
the county governments. The results of multiple
regressions, revealed that quality expectation has a
p = 0.000. Since the p- value is less than < 0.05, the
null hypothesis was rejected. It was then concluded
that there is significant effect of quality expectations
on procurement performance in the county
governments.
SUMMARY, CONCLUSION AND
RECOMMENDATIONS
Summary
The objective was to examine the effect of
supplier’s past performance on procurement
performance in Kirinyaga and Muranga County
Governments. To accomplish this, a five-point
Likert scale comprising of five items was used. The
highest ranked item on the scale was “Supplier’s
ability to execute contracts of similar magnitude
(4.47)”. The lowest ranked item was “Meeting the
specified prescription and departmental features
(3.55)”. Most of the heads of procurement were in
agreement that supplier’s past performance had a
significant influence on procurement performance
in the public sector. The results of the model
summary indicated that R-square=0.642 at 0.05
significance level, thus revealing that 64.2% of the
procurement performance in county governments
can be attributed to supplier’s past performance.
Conclusion
The study concluded that there is enough evidence
to conclude that there is an effect of supplier’s past
performance on procurement performance in the
county governments as evident from p-values of
0.012 and 0.000 for supplier reliability and quality
expectations respectively. Since p values are < 0.05,
the null hypothesis was rejected for both. Clearly
supplier’s past performance had an effect on
procurement performance by guaranteeing
execution of contracts of similar magnitude,
assessing the supplier’s ability to complete
contracts within the deadlines, meeting
departmental features, and delivering the right
quality of goods and services.
Recommendation
The study recommended that the procuring
departments need to ensure that their suppliers are
possess records that provide information on past
contracts and orders. In order to leverage maximum
benefits such as execution of complex contracts,
meeting short deadlines, quality outcomes, and
meeting departmental expectations, the study
recommended effective scrutiny on supplier’s
performance records before awarding them
contracts. This will help to sort uncertainties arising
from supplier failure or lack of capacity to execute
complex tasks that require a given level of expertise.
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