Effect of Operating Cost Management on Financial Performance of Sweet Potato Marketing Cooperatives in Kenya

Abstract

Sweet potato production and sale in Kenya, is a major economic activity that should be creating employment thus increasing GDP. Thus this study sought to determine how operating cost management affects the financial performance of sweet potato marketing cooperatives in Kenya. The study design was descriptive research design. The target population was four sweet potato marketing cooperatives registered as at December, 2015 by the Commissioner of cooperatives in Kenya comprising of Homabay, Bungoma, Busia and Siaya counties which also formed the study target units. Census sampling was used to select sample of the population. Secondary data over the ten year-period covering 2006-2015 was obtained. Data was collected using secondary data collection sheet and analyzed using multiple panel regression models. Limitations faced during data collection included high illiteracy levels amongst cooperative members. This was controlled by taking the officials through the facets of operating cost management to have them understand the concepts under enquiry. The study findings showed that operating cost management had significant influence on financial performance of sweet potato marketing cooperatives in western Kenya and tests for significance also showed that the influence was statistically significant. The study recommendation is to have sweet potato marketing cooperative officials and members trained on operating cost management aspects.