The effect of strategic inventory management on organizational performance: A mediating role of inventory management knowledge

Abstract

The logistics industry in Oman plays a critical role in the nation’s Vision 2040 economic diversification agenda. However, small and medium-sized enterprises (SMEs) in this sector face persistent challenges in managing inventory effectively due to limited resources, poor adoption of technology, and inadequate inventory management knowledge. This study investigates the effect of Strategic Inventory Management (SIM) practices on Organizational Performance (OP) in the logistics sector of Oman, with a focus on the mediating role of Inventory Management Knowledge (IMK). Grounded in the Resource-Based View, data were collected from 357 logistics SMEs through a structured questionnaire and analyzed using Structural Equation Modeling (SEM). Findings show that SIM significantly enhances OP, with Vendor Managed Inventory (VMI) and Material Requirement Planning (MRP) exerting the strongest impact. IMK was found to partially mediate the SIM and OP relationship, confirming their role as vital enablers in achieving sustainable performance. This research contributes to theory by extending RBV to logistics SMEs in an emerging economy and offers practical implications for managers and policymakers to strengthen technological and knowledge infrastructures in the logistics industry.