COST BENEFIT ANALYSIS OF INVENTORY CONTROL IN NIGERIA MANUFACTURING COMPANY (A CASE STUDY OF UNILEVER BROTHER NIGERIA LIMITED, KWARA STATE)
TABLE OF CONTENT
Table of Content
1.1 Background of the Study
1.2 Statement of the Research Problem
1.3 Justification for the Study
1.4 Objectives of the Study
1.5 Scope of the Study
1.6 Limitations of the Study
1.7 Definition of Term
2.2 Inventory Defined
2.3 Inventory Management and Control
2.4 Classification of Inventory
2.5 Reason for Carrying Inventory
2.6 Inventory Models
2.7 Inventory Policies
2.8 Economic Production Quantity
2.9 Factor Affection EO AND EPQ, EDQ AND EPQ
3.1 Profile of Uni-Lever Brother
3.2 Research Design
3.3 Scope of the Data
3.4 Source of Data
3.5 Data Collection Procedure
3.6 Method of Data Analysis
DATA PRESENTATION, ANALYSIS AND INTERPRETATION
4.1 Data Presentation And Analysis
4.2 Purchasing Policies
4.3 Receiving Procedure
4.4 Stock Control Policies
4.5 Distribution Policies
4.6 Warehouse Policies
4.7 Tabulation of Data
4.8 Cost Saving Effect of EPQ Model on Finished Products
4.9 Result of Finding
SUMMARY, CONCLUSION AND RECOMMENDATIONS
5.1 Summary of Major Findings
1.1 BACKGROUND OF THE STUDY
A critical review of the financial statement of most companies would review the substantial amount normally held on inventory.
Inventory refers stock of items used within the production system or the operation of business coming among which are: raw materials, semi finished (working – in progress) and finished goods of a given company.
Inventories are stack of goods that are maintained by a business in anticipation of some future demands such demands could be for products manufactured by the company or supplies used in the transformation process.
In other words, investment are current asset and relate to a specific accounting period, their use should be as mush as possible, be regulated within the period to which they relate.
The type of inventories kept by a firm depends on the firm in question, the business operation, financial resources and other factors. Inventory control system must always maintain a sufficient amount of material and supply to meet the demand of the production unit being out of stock and item may course idle time and production re-scheduling management is the function in business of making decision and hence of what to determine and follow how resources are used and what is produced.
It is a management responsibility to define the nature of organization.
The availability and quality of those inventories, is therefore a parameter to determine their efficiency.
Their investment in inventories is usually so high that proper and continuous reliance on them. The stock in an investment which repress out some equivalent amount in cash from which profit or margin is expected. However where the stock does not attract a profit due to the stock lying follows in the stock therefore this recognition of the afore said, that the topic is chosen.
COST BENEFIT ANALYSIS AND INVENTORY CONTROL
IN NIGERIA MANUFACTURING COMPANY
Though the term inventory control may have different meaning to different meaning to different users, more often, the term is usually construed to mean materials controller stock control .
Generally, inventory control is the system that ensures the provision of the required quantity material at the required time with the minimum amount of material costs.
It is appropriate or relevant to know that high level of service and production cannot be provided unless there is an efficient inventory management and facilities, inventories must serve as butter between production, transportation and consumption.
In conclusion on inventories as cussion help to absorb planning error and unforeseen fluctuation in supply and demand and to facilitate smooth and marketing function.
1.2 STATEMENT OF THE RESEARCH PROBLEM
There are many if what is in handing of inventories some of the more significant cast are interest charge storage cost, handing cost, insurance cost, obsolescent cost and space utilization cost inventories load to loss of sales and customers good will.
Obviously, manufacturing companies as a whole, are passing through a temperature period as a result of the prevailing state of the economy the survival of any company depends on how effectiveness and efficient the company’s strategies nearly all manufacturing concerns are aiming at providing goods and services to customer at the least possible cost in order to generate maximum profit.
However, it was realized that without keeping the necessary level of inventory the manufacturing concern might spend too much in keeping excess inventory, of loss customer as a result of keeping excess low level of inventory necessaries the need to venture in to studying inventory (as an integrate arm of production) Uni-Lever Brothers Nigeria Plc produced by the company shows the strength of the organization this implies that the company must have been keeping a form it an inventory level, even when the economy was bad that is, when getting raw materials was a problem, Uni- Level Brothers has been moving on well, that makes the company a special one and studying this inventory management is a worth while experience. Since inventory cost do affect profitability companies are confronted with the problem of:
a. Audit carrying obsolete goals in stock.
b. Maintain adequate liaison between the production control purchasing and marketing department.
c. Try to maintain effective inventory control to avoid over large orders replenishment orders out or phase with production.