Effect of Warehouse Automation on the Operational Performance of Distribution Firms in Kenya

Distribution firms in Kenya operate in an increasingly competitive environment where efficiency, accuracy, and responsiveness are essential for sustaining operational performance. As firms seek to enhance these capabilities, warehouse automation has become a vital strategic tool for improving core warehouse functions. This study assessed the effect of warehouse automation on the operational performance of distribution firms in Kenya. A cross-sectional survey design was adopted, targeting a population of 1,061 registered distribution firms (KNBS, 2022), from which 290 procurement officers were selected using the Yamane formula. Primary data were gathered through structured questionnaires, supported by secondary sources for contextual validation. Data analysis involved descriptive statistics and inferential techniques, including correlation analysis and structural equation modelling. The results showed that warehouse automation significantly enhances operational performance, with a positive correlation of r = 0.765 (p < 0.01; R² = 0.585), indicating notable improvements in processing speed, inventory accuracy, and workflow efficiency. The overall model, combining all four warehouse consolidation practices, explained 74.5% of the variance in operational performance (R² = 0.745). Moderation analysis confirmed that firm size significantly moderated the overall relationship between warehouse consolidation and performance (B = −0.060, p = .033), with larger firms experiencing slightly diminishing returns from automation investments at scale. The findings underscore automation as a key driver of superior operational outcomes in distribution settings. The study recommends increased investment in flexible automation technologies and integration of digital warehousing systems to strengthen reliability, cost efficiency, and responsiveness across Kenya's distribution sector.