Inventory Management and Control Policies in Nigeria Enterprise a Case Study of Selected Medium Scale Enterprise in Uyo
CHAPTER ONE
- OBJECTIVES OF THE STUDY
The objective of this study embraces the following:
- To assess the fundamental techniques of inventory management and control policies in manufacturing establishment in the state.
- To examine how effective the techniques adopted by these establishments have been in ensuring optimal inventory cost
- To ascertain the problems that confronts proper inventory management and control in medium scale enterprises in the state.
- To proffer recommendations for effective inventory management and control in medium scale enterprises.
CHAPTER TWO
REVIEW OF RELATED LITERATURE
Concept of Inventory Management
Coyle, et al (2003) define inventory as raw materials, work-in progress, finished goods and supplies required for creation of a company’s goods and services. It is also the number of units and/or value of the stock of goods a company holds. Dave (2001) on the other hand also defines inventory as “the stock of any item or resource used in an organization”. In a broader context, inventory can include inputs such as financial, energy, human, equipment, and physical items such as raw material; inputs such as parts, components, and finished goods; and interim stages of the process, such as partially finished goods or work-in-progress. Lysons and Gillingham (2003) postulate that inventory management refers to the entire activities involved in developing and managing the inventory levels of raw materials, semi-finished materials (work-in-progress) and finished good so that adequate supplies are available and the costs of over or under stocks are low. Inventory management is the process of effectively overseeing the constant flow of units into and out of an existing inventory. This process usually involves controlling the transfer of the units in order to prevent the inventory from becoming too high, or dwindling to levels that could put the operation of a business into jeopardy. Effective inventory management seeks to control the costs associated with the inventory, from the perspective of the opportunity cost of the capital tied up in the inventory, the holding cost and the ordering costs. According to Kanguru, (2016), Economic Order Quantity(EOQ), Just in Time (JIT), ABC Analysis and Rules of Thumb are major inventory management practices. Gitau, (2016) argues that Automatic Replenishment, Activity Based Costing (ABC) Inventory Model, Just-In Time(JIT) Inventory, Economic Order Quantity EOQ and Vendor Managed Inventory are inventory management practices, while Onyango, (2016) also assert that Re-Order Level, Economic Order Quantity, Just-InTime, Vendor Managed Inventory and Activity Based Costing Analysis are main inventory management. For the purpose of this study, the inventory management practices discussed are Activity Based Costing Analysis, Just-In Time (JIT) Inventory, Economic Order Quantity EOQ) and Vendor Managed Inventory which mostly applicable in small scale enterprises.
CHAPTER THREE
RESEARCH METHODOLOGY
- Research design
The researcher used descriptive research survey design in building up this project work the choice of this research design was considered appropriate because of its advantages of identifying attributes of a large population from a group of individuals. The design was suitable for the study as the study sought to inventory management and control policies in Nigeria Enterprise a case study of selected medium scale Enterprise in uyo
Sources of data collection
Data were collected from two main sources namely:
Primary source:
These are materials of statistical investigation which were collected by the research for a particular purpose. They can be obtained through a survey, observation questionnaire or as experiment; the researcher has adopted the questionnaire method for this study.
Secondary source:
These are data from textbook Journal handset etc. they arise as byproducts of the same other purposes. Example administration, various other unpublished works and write ups were also used.
Population of the study
Population of a study is a group of persons or aggregate items, things the researcher is interested in getting information inventory management and control policies in Nigeria Enterprise a case study of selected medium scale Enterprise in uyo. 200 staff of SMEs in Uyo was selected randomly by the researcher as the population of the study.
CHAPTER FOUR
PRESENTATION ANALYSIS INTERPRETATION OF DATA
Introduction
Efforts will be made at this stage to present, analyze and interpret the data collected during the field survey. This presentation will be based on the responses from the completed questionnaires. The result of this exercise will be summarized in tabular forms for easy references and analysis. It will also show answers to questions relating to the research questions for this research study. The researcher employed simple percentage in the analysis.
CHAPTER FIVE
SUMMARY, CONCLUSION AND RECOMMENDATION
Introduction
It is important to ascertain that the objective of this study was on inventory management and control policies in Nigeria Enterprise a case study of selected medium scale Enterprise in uyo. In the preceding chapter, the relevant data collected for this study were presented, critically analyzed and appropriate interpretation given. In this chapter, certain recommendations made which in the opinion of the researcher will be of benefits in addressing the challenges of inventory management and control policies in Nigeria Enterprise a case study of selected medium scale Enterprise in uyo.
Summary
This study was on inventory management and control policies in Nigeria Enterprise a case study of selected medium scale Enterprise in uyo. Fives objectives were raised which included: To assess the fundamental techniques of inventory management and control policies in manufacturing establishment in the state, to examine how effective the techniques adopted by these establishments have been in ensuring optimal inventory cost, to ascertain the problems that confronts proper inventory management and control in medium scale enterprises in the state and to proffer recommendations for effective inventory management and control in medium scale enterprises.. In line with these objectives, two research hypotheses were formulated and two null hypotheses were posited. The total population for the study is 200 staff of selected SMEs in Uyo. The researcher used questionnaires as the instrument for the data collection. Descriptive Survey research design was adopted for this study. A total of 133 respondents made up managers, secretaries, sale reps and junior staff was used for the study. The data collected were presented in tables and analyzed using simple percentages and frequencies
Conclusion
Most of the industries in Nigeria are medium scaled private industries which employed more than 100 labours both skilled and unskilled labours. This contributes to economy and manpower development of the country. Most of these industries engaged in raw materials inventory system with more than 5 suppliers of raw materials which improved the quality of their goods and services. There is high level of insecurity in Nigerian industries as regards transportation of raw material, finished goods, low capital outlay, expatriates, among others; this insecurity has affected inventory management of the industries greatly. Other social challenges including political instability should be controlled and brought to minimal for the enhancement of a sustainable inventory management of the industries in the nearest future. Practical approaches such as just-in-time inventory system or expansion of number of suppliers of basic items (raw material, manpower, etc.) will be helpful in solving many of the inventory management challenges in the nearest future. The general finding from the results indicated that the size, funding capability, and operation environment of the individual industry played a significant role on the choice of inventory system it practiced
Recommendation
That project management should be aware of the different perceptions stakeholders may have of the potential effects of the system in order to guide the behaviour of the stakeholders.
The company should try by all means to adhere to inventory polices made. A situation is a case whereby materials or items are allowed to leave the stores without proper requisition, this shows that the internal control is weak. In order to ensure that the company adheres to inventory policies, under no circumstance should items of inventory be allowed to leave stores without proper requisition.
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