Abstract: This study sought to establishthe role of applying strategic inventory management systems on performance of petroleum marketing firms in Nairobi. The specific objectives were: to determine the effect of applying strategic chip based fuel management system on performance of petroleum marketing firms in Nairobi, to investigate the effect of applying strategic economic order quantity (EOQ) model on performance of petroleum marketing firms and to examine the effect of applying strategic Always Better Control (ABC) analysis on performance of petroleum marketing firms. The research design was descriptive in nature and the population consisted of management and supervisory staff from different departments of the petroleum marketing firms within Nairobi County.