Description
ABSTRACT
This study examines the essence of effective inventories control and management to
manufacturing companies with particular emphasis on Ama Greenfield Breweries plc.
The aim of this study is to investigate and ascertain areas of lapses by the company and
offer effective ways and solutions in which the manufacturing company can explore the
services of inventory management to effect its objectives. In carrying out this study,
various research instruments such as questionnaires and oral interview were used to
collect data from respondents and a research design was adopted with a sample size of
52. The statistical tool used for this work is Chi-square. Based on the analysis, it was
discovered that inventory management plays a vital role in the manufacturing company.
A well functional inventory management following the recommendations can bring about
proper management thereby enhancing proper and effective production and it will equally
ensure the effective, efficient and adequate use of materials and resources in the
manufacturing company.
TABLE OF CONTENTS
Title page – –
Approval page- –
Dedication – – –
Acknowledgement –
– – – – – – -i
– – – – – – -ii
– – – – – – -iii
– – – – – – -iv
Abstract – – – – – – – – -v
Table of contents – – – – – – – -vi
CHAPTER ONE
1.0 Introduction – – – – – – – -1
1.1 Background of the study – – – – – -1
1.2 Statement of the problem – – – – -5
1.3 Objective of the study – – – – – -6
1.4 Test of hypotheses – – – – – – -6
1.5 Research questions- – – – – – -7
1.6 Significance of the study – – – – – -8
1.7 Scope of the study – – – – – – -8
1.8 Limitation of the study – – – – – – -9
1.9 Definition of terms – – – – – -9
CHAPTER TWO
Introduction 11
Concept of inventory 11
Types of inventory 13
Classification of inventories 15
Inventory policy 16
Reasons for inventory 17
Inventory control 19
Purposes of inventory control 21
Cost associated with inventory 21
Inventory model 25
Economic order quantity 26
Replenishment model 28
Inventory level 28
Inventory valuation method 30
Inventory Accounting System 33
Stock taking methods 34
References 35
CHAPTER THREE
RESEARCH METHODOLOGY
3.0 Introduction – – – – – – – -36
3.1 Research design – – – – – – – -36
3.2 Area of the study – – – – – – – -36
3.3 Population of the study- – – – – – -37
3.4 Determination of the sample size and technique- – -37
3.5 Sources of data – – – – – – – -40
3.6 Method of data analysis – – – – – – -40
3.7 Validity of the test – – – – – – -41
3.8 Reliability of the test – – – – – – -41
CHAPTER FOUR
DATA PRESENTATION AND ANALYSIS – – – –
4.0 Introduction – – – – – – – -43
4.1 Presentation of data- – – – – – -43
4.2 Analysis of data – – – – – – – -44
4.3 Test of hypothesis – – – – – – -54
CHAPTER FIVE
SUMMARY, CONCLUSION AND RECOMMENDATION
5.1 Summary of findings- – – – – – -58
5.2 Conclusion- – – – – – – – -61
5.3 Recommendation — – – – – – -62
Bibliography – – – – – – – -65
Appendix- – – – – – – – -68
CHAPTER ONE
INTRODUCTION
BACKGROUND OF THE STUDY
Inventory is one of the resources that are managed by business
organizations and it was first recorded in 1601. The need for inventory
control cannot be overemphasized as it is a means for improving the
performance of manufacturing industries. Inventory can be defined as a
record of a business current assets including property owned, merchandise
on hand and the value of work in progress and work complete but not sold
and it is classified as a current asset because it can be turned into liquid cash
within a short period of time. Inventory has created a great impact on the
profitability of the manufacturing firm which resulted to the deep research of
this topic. Effectiveness of inventory management in a manufacturing
company.
Inventory plays a major role in the operation of many businesses and
manufacturing companies. In manufacturing, inventories of raw materials
allow companies to operate independently of their sources of supplies. Day
to day operation are not dependent on deliveries from supplies since stock of
the necessary mateials are maintained and used s needed. Without inventory
control, millions of naira could be lost year because of non accountability of
stocks and inaccurate checks and balances.
The process of control and management of inventory is a very
important factor in the success or failure of any business for example, little
stock will result in stock out which will disrupt the production distribution
cycle that is crucial to the survival of all manufacturing companies while
too much stock will tie down the resources of a company. Poor or
inadequate inventory management can present a serious challenge to the
productive capacity of a manufacturing organization. In addition to raw
materials and finished goods, many companies also maintain items of assets,
property, inventories of work in progress, office supplies, business firms and
general operation supplies.