The relationship of operational practices improving inventory performance and the financial performance of the firm

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Suhas Ambekar, et. al.


The study attempts to understand the relationship of inventory related operational practices and the financial performance of a firm. A sample of 179 manufacturing firms from western part of India is chosen and the data from financial reports from 2008 to 2018 was used to study the results. A regression-based model is developed and tested to establish the relationship. The study found that operational practices improving inventory management may not explain the financial performance. Improvement in inventory management has limited effect on financial performance as the measures used to evaluate financial performance are influenced by various factors other than operational practices

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