EFFECT OF PRODUCT QUALITY INVESTMENT DECISIONS ON FINANCIAL PERFORMANCE OF LARGE MANUFACTURING FIRMS IN NAIROBI METROPOLITAN REGION, KENYA

Agnes W. Waweru, Dr. Peter Kariuki

Abstract


Investment decisions are among the three most essential decisions a corporation makes daily, along with financing and operational decisions. Large manufacturing enterprises in Kenya are currently experiencing challenging times, posing a significant threat to their profitability. The overall goal of this research was to see how product quality investment decisions affected the financial performance of major manufacturing enterprises in Kenya's Nairobi Metropolitan Region. This study used an explanatory research design and a descriptive survey design. The study focused on all 126 significant industrial companies in the Nairobi Metropolitan Region (Nairobi County, Kiambu County, Muranga County, Kajiado County and Machakos County). The finance manager/director in each firm formed the unit of analysis. A questionnaire was used to collect data. The mean and standard deviation were used as descriptive statistics. Simple regression analyses was utilized as inferential statistics. Tables were used to present the findings. Product quality investment decisions, had statistically significant effects on manufacturing business financial performance in Kenya, according to the study. The study indicates that investment decisions are critical in allocating funds to various investment opportunities within the organization to achieve the best potential return. As a result, this research suggests that management should conduct a market study and be clear on the company's goals. It's equally critical that management has properly studied the demand and financing methods. In the second place, the director must analyze whether the resources adapt to the optimal size desired for the company. Firm managers should give their employees ways to be more innovative and make new investments, such as investments in product quality improvement. This will help their businesses be more profitable and financially successful.

Keywords: Product Quality Investment Decisions, Financial Performance


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