Sub-Saharan Africa tomato losses caused by poor packaging averaged 35%. In 2021, Kenya lost approximately 20% of tomato produce partly because of poor packaging, which is equivalent to Ksh.4.6 billion losses to the fresh tomato agribusinesses (FTAs). The target population for the study was 297 consisting of 269 registered FTA (suppliers, wholesalers and retailers), 14 county crops officers and 14 county trade officers in KLREB. A pilot study included 17 respondents from Kisumu County. Primary data was collected using a structured questionnaire. Correlation and regression analysis were used to examine relationship between IL and performance, and moderated effect of VCM, RF and P of FTA while Sobel test was used to establish mediation. Results showed that 76.7.0% of FTAs used heaped crates and 23.3% used flat crates. Moderated mediation effect of RF and VCM reduced the effect of IL on performance of FTA by 5.7%. The current study, affirmed that appropriate and proper packaging protects horticultural materials (tomatoes) from damages resulting from impact, handling, exposure and transport vibrations. Nevertheless, the study revealed that inappropriate packaging and heaping fresh tomatoes behold the crate/box edge expose the produce to damaging that leads to subsequent food loss. This study did not only investigate the drawbacks of using inappropriate packaging but also established the benefits of using appropriate packaging. This study established that heaped crates generated between 12.1% and 14.7% damaged tomatoes while flat crates generated between 1.5% and 2.6% damaged tomatoes. Therefore, effective/appropriate packaging reduced damages that cause food loss by between 79% and 90%. This study, established that damages caused by heaping are equivalent to the difference between damages incurred from inappropriate packaging and damages incurred from appropriate packaging along the supply chain adding up to 13.2% (14.7% from heaped 50kg crates- 1.5% from 30kg flat crates). To enhance performance of FTAs in the Kenya Lake Region Economic Bloc, the study recommends that there is need for concerted efforts to involve FTA owners in formulating policies geared towards fostering collaborative partnerships to ensure adoption of appropriate packaging that optimise performance and review of the current act concerning appropriate packaging.