Impact of Inventory Control and Planning in Store Administration
OBJECTIVES OF STUDY
The primary objectives of this research work is to assess the impact of inventory control and planning in stores administration. Specifically, other objectives are:
- To highlight the immense/importance of efficient stock planning and control in stores administration.
- Finding solutions to the problems of managing and controlling stocks in the stores administration.
- Finding the likely consequences of overstocking and under stocking planning and control in stores administration and the benefits attributable to having stock at it optimal level.
- Whether there is divergence between policy and practice in the stock management of fan milk industry in Owerri.
- To ensure that the services of a qualified stores administrator is employed in the store of the organization to enhance inventory control and planning.
CHAPTER TWO
REVIEW OF LITERATURE
INTRODUCTION
Our focus in this chapter is to critically examine relevant literature that would assist in explaining the research problem and furthermore recognize the efforts of scholars who had previously contributed immensely to similar research. The chapter intends to deepen the understanding of the study and close the perceived gaps.
Precisely, the chapter will be considered in three sub-headings:
- Conceptual Review
- Theoretical Framework
- Empirical Review
CONCEPTUAL FRAMEWORK
Concept of Inventory
According to Nnubia, OmaIiko, Ogechi, & Etuka (2017), a company’s inventory is the stock of items and components it generates for sale. Hilton (1994) in Amahalu, Abiahu, Obi & Nweze (2018) defines inventory as an itemized list of goods or assets with their estimated worth, particularly the annual accounting stock gathered by a business.
Regardless of the benefits they give to the organization, there are costs associated with inventory storage. Consequently, they should be kept at optimal levels. That is, at a level where the marginal yield equals the marginal cost of money required to fund the expansion in inventory (Buxey, 2016). Consequently, an effective method for inventory management is necessary.
The success or failure of a business is reliant on the performance of its inventory management, since efficient inventory management not only helps to solve the liquidity problem but also increases the company’s profitability (Buxey, 2016).
Inventory also plays a substantial role in determining the financial health and profitability of these companies. Since inventory is one of the most essential components of the financial position list, particularly for commercial organizations since it represents the greatest value of their assets, any inaccuracy in establishing the cost of that stock or evaluating it leads in erroneous financial statement outputs (Chan, Tasmin, Aziati, Rasi, Isa, & Yaw, 2007).
Inventories are the tangible assets that a business holds with the intent of selling or transforming them into a more valuable state. For the majority of manufacturers, distributors, and retailers, inventory constitutes the largest asset investment. It is the preservation of underused resources for future use. These things are stored on-site or nearby so that a firm may achieve its mission and satisfy client demand. If the retail store does not have the item in stock when the customer arrives, he or she may look elsewhere to satisfy his or her needs. To keep the facility running, a manufacturing business must maintain an inventory of raw materials and work-in-progress. In addition, it must maintain a minimum amount of finished goods to meet demand. Inventories are the tangible assets that a business holds with the intent of selling or transforming them into a more valuable state. For the majority of manufacturers, distributors, and retailers, inventory represents the biggest asset investment (Atnafu & Balda 2018). It is the preservation of underused resources for future use.
CHAPTER THREE
RESEARCH METHODOLOGY
INTRODUCTION
In this chapter, we described the research procedure for this study. A research methodology is a research process adopted or employed to systematically and scientifically present the results of a study to the research audience viz. a vis, the study beneficiaries.
RESEARCH DESIGN
Research designs are perceived to be an overall strategy adopted by the researcher whereby different components of the study are integrated in a logical manner to effectively address a research problem. In this study, the researcher employed the survey research design. This is due to the nature of the study whereby the opinion and views of people are sampled. According to Singleton & Straits, (2009), Survey research can use quantitative research strategies (e.g., using questionnaires with numerically rated items), qualitative research strategies (e.g., using open-ended questions), or both strategies (i.e., mixed methods). As it is often used to describe and explore human behaviour, surveys are therefore frequently used in social and psychological research.
POPULATION OF THE STUDY
According to Udoyen (2019), a study population is a group of elements or individuals as the case may be, who share similar characteristics. These similar features can include location, gender, age, sex or specific interest. The emphasis on study population is that it constitute of individuals or elements that are homogeneous in description.
This study was carried out to examine the impact of inventory control and planning in stores administration. Selected staff of Fan Milk Industry in Owerri, Imo State form the population of the study.
CHAPTER FOUR
DATA PRESENTATION AND ANALYSIS
INTRODUCTION
This chapter presents the analysis of data derived through the questionnaire and key informant interview administered on the respondents in the study area. The analysis and interpretation were derived from the findings of the study. The data analysis depicts the simple frequency and percentage of the respondents as well as interpretation of the information gathered. A total of thirty-six (36) questionnaires were administered to respondents of which only thirty (30) were returned and validated. This was due to irregular, incomplete and inappropriate responses to some questionnaire. For this study a total of 30 was validated for the analysis.
CHAPTER FIVE
SUMMARY, CONCLUSIONS, AND RECOMMENDATIONS:
Introduction
This chapter summarizes the findings on the impact of inventory control and planning in store administration. The chapter consists of a summary of the study, conclusions, and recommendations.
Summary of the Study
In this study, our focus was on the impact of inventory control and planning in stores administration. The study is was specifically set to highlight the immense/importance of efficient stock planning and control in stores administration, find solutions to the problems of managing and controlling stocks in the stores administration, find the likely consequences of overstocking and under stocking planning and control in stores administration and the benefits attributable to having stock at it optimal level, find out whether there is divergence between policy and practice in the stock management of fan milk industry in Owerri and ensure that the services of a qualified stores administrator is employed in the store of the organization to enhance inventory control and planning.
The study adopted the survey research design and randomly enrolled participants in the study. A total of 30 responses were validated from the enrolled participants where all respondent are staff of Fan Milk Industry in Owerri.
Conclusions
Based on the findings of this study, the researcher concluded that;
- Store administration appreciates the importance of efficient, the impact of inventory control and planning.
- Overstock introduces unnecessary carrying cost and tying up of capital.
- The impact of inventory control and planning is of importance to stores administration.
- Under stocking results to stock out in store administration.
Recommendation
Based on the findings the researcher recommends;
- It would be salutary for stores administration to invest more in inventory control techniques to reduce the cost of procurement through unnecessary stock breakdowns and ensure suppliers get it right the first time. This should be done consistently with the training, improvement of their inventory communication channels, processes and capacity as well as enabling them financially to acquire the up to date inventory control technique equipment.
- In relation to inventory cycle counting, the organizations should form strategic alliances with their suppliers so as to have a more improved working relationship characterized by a shared mindset and good financial and funds flow. If private commercial banks embrace systems integration among its suppliers then there will be cost reduction and timing of delivery will improve.
REFERENCES
- Alrjou B, A. M. S. & Ahmad, M. A. (2017). Inventory management, cost of capital and firm performance: evidence from manufacturing firms in Jordan. Investment management and financial innovations, 14, 4-14.
- Amahalu N.N., Abiahu, Mary-F.C., Obi, J.C., & Nweze, C.L. (2018). Effect of accounting information on market share price of selected firms listed on Nigeria stock exchange. International Journal of Recent Advances in Multidisciplinary Research 05(01), 3366- 3374.
- Amahalu, N.N., & Ezechukwu, B.O. (2017). Effect of cash holding on financial performance of selected quoted insurance firms in Nigeria. Journal of Marketing Management and Consumer Behavior, 2(1) 90-112.
- Amahalu, N.N., Ezechukwu, B. O., & Obi, J.C. (2017).Corporate social responsibility and financial performance of quoted deposit money banks in Nigeria. Asian Journal of Science and Technology, 08(12), 7183-7191.
- Amahalu, N.N., Nweze, C.L., & Obi, J.C. (2017). Effect of backflush accounting on financial performance of quoted food and beverage firms in Nigeria. EPH – International Journal of Medical and Health Science, 2(3), 58-80
