OPTIMIZING SUPPLY CHAIN COSTS THROUGH OPERATIONAL INTEGRATION: A QUANTITATIVE ANALYSIS OF INVENTORY AND WAREHOUSE STRATEGY

Abstract

Increasing operational expenses have become a KPI of concern to the manufacturing companies in Pakistan, particularly due to fragmented inventory and warehouses. This paper explores how integrated inventory management, warehouse strategy, and technology adoption affect the cost optimization process in a supply chain. The goal was to determine whether alignment of these areas of operation leads to quantifiable economic savings. Some 400 professionals in the supply chain of different manufacturing industries in Karachi were administered a structured questionnaire, and the responses were analyzed by using SPSS (version 26). Reliability analysis confirmed a good level of internal consistency (Cronbach's alpha > 0.7). In contrast, multiple regression analysis revealed cost optimization was significantly influenced by the technology integration (beta = 0.48), inventory practices (beta = 0.42) and warehouse strategies (beta = 0.31) in a positive way (p < 0. 01). The general model was significant (R 2 = 0.61), validating that the integrated methodology accounted 61 percent of the variance in cost performance. The research suggests the application of ERP systems, lean warehousing, and real-time inventorying by manufacturing companies to increase coordination and eliminate operational waste. This study contributes to the supply chain literature on cost efficiency, particularly in the context of internal integration processes, and notably in emerging economies such as Pakistan.