INVENTORY MANAGEMENT AND CUSTOMER SATISFACTION OF PETROLEUM MARKETING FIRMS IN RIVERS STATE: THE MODERATING ROLE OF MARKET ORIENTATION

Abstract

Inventory management is regarded as a fundamental component of the logistics system which helps to secure coherent supply of products to customers and achieve organizational objectives. In a strong competitive environment, it ensures that customers are retained and satisfied. Therefore, it is important to explore how adequate management of inventory can enhance customer satisfaction. This study investigated the relationship between inventory management and customer satisfaction of petroleum marketing firms in Rivers State and how market orientation moderated the relationship. A cross sectional survey research design was adopted. Based on a population size of (13) quoted petroleum marketing firms in Rivers State as listed on the Nigerian Stock Exchange (NSE).  To ensure proper coverage of the aforementioned firms, three (3) respondents were drawn from each of the firms for the survey. Thirty-nine (39) copies of the structured questionnaire representing the respondents were appropriately administered on a five (5) point Likert scale to our respondents comprising three categories of our unit of analysis – Dealers, Supervisors and Pump attendants. The validity of the questionnaire was confirmed through the opinion of a group of professionals; scholars and business practitioners with sufficient knowledge of the subject of the study. And the Cronbach's Coefficient Alpha reliability measure was applied to determine the internal consistency of items in the questionnaire using Statistical Package for Social Sciences (SPSS) version 22. Out of this number, thirty (30) copies of the questionnaire were retrieved and found usable. The Pearson Moment correlation coefficient was used to determine the relationship between the dimensions of inventory management (Inventory planning and optimization) and customer satisfaction. And Partial Correlation was used to determine the extent of moderation of market orientation on the relationship between inventory management and customer satisfaction.  Findings show that inventory management has a positive and significant relationship with customer satisfaction of petroleum marketing firms in Rivers State. And market orientation has a positive effect on the relationship. Therefore, the study recommends that Petroleum marketing firms Rivers State should adopt a market orientation as they plan and optimize their inventory to achieve and sustain consistent customer satisfaction.