Top Manager Gender Differences in Inventory Management Under Business Obstacles

ABSTRACT While the effect of gender on firm performance has been widely studied, its impact on operational policies remains underexplored. We examine the association between top managers' gender and inventory policy among small and medium‐sized enterprises (SMEs), where top managers play a central role in policy formulation and execution. We find that female‐led firms hold lower levels of industry‐adjusted inventory than male‐led firms, with stronger effects in manufacturing and microsized firms. We further show that this relationship is context dependent: female‐led firms maintain leaner inventories when business obstacles heighten perceived overstocking and liquidity risk, but increase inventories when obstacles threaten operational continuity. Repeating the analysis using female ownership as the key variable yields weaker effects, supporting the role of the top manager in shaping operational policy. We also document an inverted U ‐shaped relationship between inventory and firm performance; most firms operate below the performance‐maximizing inventory level, and female‐led firms tend to remain further from this optimum, contributing to gender differences in firm performance.